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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2019
 
OR
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
Commission File No. 001-07511
STATE STREET CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts
 
04-2456637
(State or other jurisdiction of incorporation)
 
(I.R.S. Employer Identification No.)
One Lincoln Street
Boston, Massachusetts
 
02111
(Address of principal executive office)
 
(Zip Code)
617-786-3000
(Registrant’s telephone number, including area code)
 
 
 
 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes  x   No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  x   No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act.
    Large accelerated filer  x
 
Accelerated filer ¨
 
Non-accelerated filer  ¨
 
Smaller reporting company  ¨
    Emerging growth company ¨
 
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes  ¨  No  x
The number of shares of the registrant’s common stock outstanding as of April 29, 2019 was 373,163,922.



 


STATE STREET CORPORATION
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTERLY PERIOD ENDED
March 31, 2019

TABLE OF CONTENTS

 
 
PART I. FINANCIAL INFORMATION
 
Table of Contents for Management's Discussion and Analysis of Financial Condition and Results of Operations
3
Management's Discussion and Analysis of Financial Condition and Results of Operations
4
Quantitative and Qualitative Disclosures About Market Risk
47
Controls and Procedures
47
Consolidated Statement of Income (Unaudited) for the three months ended March 31, 2019 and 2018
48
Consolidated Statement of Comprehensive Income (Unaudited) for the three months ended March 31, 2019 and 2018
49
Consolidated Statement of Condition as of March 31, 2019 (Unaudited) and December 31, 2018
50
Consolidated Statement of Changes in Shareholders' Equity (Unaudited) for the three months ended March 31, 2019 and 2018
51
Consolidated Statement of Cash Flows (Unaudited) for the three months ended March 31, 2019 and 2018
52
Condensed Notes to Consolidated Financial Statements (Unaudited)
53
Review Report of Independent Registered Public Accounting Firm
89
PART II. OTHER INFORMATION
 
Unregistered Sales of Equity Securities and Use of Proceeds
92
Exhibits
93
Signatures
94




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TABLE OF CONTENTS














We use acronyms and other defined terms for certain business terms and abbreviations, as defined on the acronyms list and glossary following the consolidated financial statements in this Form 10-Q.

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GENERAL
State Street Corporation, referred to as the Parent Company, is a financial holding company organized in 1969 under the laws of the Commonwealth of Massachusetts. Our executive offices are located at One Lincoln Street, Boston, Massachusetts 02111 (telephone (617) 786-3000). For purposes of this Quarterly Report on Form 10-Q for the quarter ended March 31, 2019 (Form 10-Q), unless the context requires otherwise, references to "State Street," "we," "us," "our" or similar terms mean State Street Corporation and its subsidiaries on a consolidated basis. The Parent Company is a source of financial and managerial strength to our subsidiaries. Through our subsidiaries, including our principal banking subsidiary, State Street Bank and Trust Company, referred to as State Street Bank, we provide a broad range of financial products and services to institutional investors worldwide, with $32.64 trillion of AUC/A and $2.81 trillion of AUM as of March 31, 2019.
As of March 31, 2019, we had consolidated total assets of $228.33 billion, consolidated total deposits of $162.47 billion, consolidated total shareholders' equity of $25.04 billion and 39,969 employees. We operate in more than 100 geographic markets worldwide, including in the U.S., Canada, Europe, the Middle East and Asia.
Our operations are organized into two lines of business, Investment Servicing and Investment Management, which are defined based on products and services provided.
Additional information about our lines of business is provided in Line of Business Information in this Management's Discussion and Analysis and Note 18 to the consolidated financial statements in this Form 10-Q.
This Management's Discussion and Analysis is part of the Form 10-Q and updates the Management's Discussion and Analysis in our 2018 Annual Report on Form 10-K previously filed with the SEC (2018 Form 10-K). You should read the financial information contained in this Management's Discussion and Analysis and elsewhere in this Form 10-Q in conjunction with the financial and other information contained in our 2018 Form 10-K. Certain previously reported amounts presented in this Form 10-Q have been reclassified to conform to current-period presentation.
We prepare our consolidated financial statements in conformity with U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions in its application of certain accounting policies that materially affect the reported amounts of assets, liabilities, equity, revenue and expenses.
The significant accounting policies that require us to make judgments, estimates and assumptions that
 
are difficult, subjective or complex about matters that are uncertain and may change in subsequent periods include:
•
accounting for fair value measurements;
•
OTTI of investment securities;
•
impairment of goodwill and other intangible assets; and
•
contingencies.
These significant accounting policies require the most subjective or complex judgments, and underlying estimates and assumptions could be subject to revision as new information becomes available. For additional information about these significant accounting policies refer to pages 115 to 116, “Significant Accounting Estimates” included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our 2018 Form 10-K. We did not change these significant accounting policies in the first three months of 2019.
Certain financial information provided in this Form 10-Q, including in this Management's Discussion and Analysis, is prepared on both a U.S. GAAP, or reported basis, and a non-GAAP basis, including certain non-GAAP measures used in the calculation of identified regulatory ratios. We measure and compare certain financial information on a non-GAAP basis, including information (such as capital ratios calculated under regulatory standards then scheduled to be effective in the future) that management uses in evaluating our business and activities.
Non-GAAP financial information should be considered in addition to, and not as a substitute for or superior to, financial information prepared in conformity with U.S. GAAP. Any non-GAAP financial information presented in this Form 10-Q, including this Management’s Discussion and Analysis, is reconciled to its most directly comparable then currently applicable regulatory ratio or U.S. GAAP-basis measure.
We further believe that our presentation of FTE NII, a non-GAAP measure, which reports non-taxable revenue, such as interest income associated with tax-exempt investment securities, on a FTE basis, facilitates an investor's understanding and analysis of our underlying financial performance and trends.

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We provide additional disclosures required by applicable bank regulatory standards, including supplemental qualitative and quantitative information with respect to regulatory capital (including market risk associated with our trading activities) and the LCR, summary results of semi-annual State Street-run stress tests which we conduct under the Dodd-Frank Act, and resolution plan disclosures required under the Dodd-Frank Act. These additional disclosures are accessible on the “Investor Relations” section of our corporate website at www.statestreet.com.
We have included our website address in this report as an inactive textual reference only. Information on our website is not incorporated by reference into this Form 10-Q.
We use acronyms and other defined terms for certain business terms and abbreviations, as defined in the acronyms list and glossary following the consolidated financial statements in this Form 10-Q.
Forward-Looking Statements
This Form 10-Q, as well as other reports and proxy materials submitted by us under the Securities Exchange Act of 1934, registration statements filed by us under the Securities Act of 1933, our annual report to shareholders and other public statements we may make, may contain statements (including statements in our Management's Discussion and Analysis included in such reports, as applicable) that are considered “forward-looking statements” within the meaning of U.S. securities laws, including statements about our goals and expectations regarding our business, financial and capital condition, results of operations, strategies, cost savings and transformation initiatives, investment portfolio performance, dividend and stock purchase programs, outcomes of legal proceedings, market growth, acquisitions, joint ventures and divestitures, client growth and new technologies, services and opportunities, as well as industry, governmental, regulatory, economic and market trends, initiatives and developments, the business environment and other matters that do not relate strictly to historical facts.
Terminology such as “plan,” “expect,” “intend,” “objective,” “forecast,” “outlook,” “believe,” “priority,” “anticipate,” “estimate,” “seek,” “may,” “will,” “trend,” “target,” “strategy” and “goal,” or similar statements or variations of such terms, are intended to identify forward-looking statements, although not all forward-looking statements contain such terms.
Forward-looking statements are subject to various risks and uncertainties, which change over time, are based on management's expectations and assumptions at the time the statements are made, and are not guarantees of future results. Management's expectations and assumptions, and the continued validity of the forward-looking statements, are subject
 
to change due to a broad range of factors affecting the U.S. and global economies, regulatory environment and the equity, debt, currency and other financial markets, as well as factors specific to State Street and its subsidiaries, including State Street Bank. Factors that could cause changes in the expectations or assumptions on which forward-looking statements are based cannot be foreseen with certainty and include, but are not limited to:
•
the financial strength of the counterparties with which we or our clients do business and to which we have investment, credit or financial exposures or to which our clients have such exposures as a result of our acting as agent, including as an asset manager or securities lending agent;
•
increases in the volatility of, or declines in the level of, our NII; changes in the composition or valuation of the assets recorded in our consolidated statement of condition (and our ability to measure the fair value of investment securities); and changes in the manner in which we fund those assets;
•
the volatility of servicing fee, management fee, trading fee and securities finance revenues due to, among other factors, the value of equity and fixed-income markets, market interest and FX rates, the volume of client transaction activity, competitive pressures in the investment servicing and asset management industries, and the timing of revenue recognition with respect to processing fees and other revenues;
•
the liquidity of the U.S. and international securities markets, particularly the markets for fixed-income securities and inter-bank credits; the liquidity of the assets on our balance sheet and changes or volatility in the sources of such funding, particularly the deposits of our clients; and demands upon our liquidity, including the liquidity demands and requirements of our clients;
•
the level and volatility of interest rates, the valuation of the U.S. dollar relative to other currencies in which we record revenue or accrue expenses and the performance and volatility of securities, credit, currency and other markets in the U.S. and internationally; and the impact of monetary and fiscal policy in the U.S. and internationally on prevailing rates of interest and currency exchange rates in the markets in which we provide services to our clients;
•
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 OTTI of such securities and the recognition of an impairment loss in our consolidated statement of income;

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•
our ability to attract deposits and other low-cost, short-term funding; our ability to manage the level and pricing of such deposits and the relative portion of our deposits that are determined to be operational under regulatory guidelines; and our ability to deploy deposits in a profitable manner consistent with our liquidity needs, regulatory requirements and risk profile;
•
the manner and timing with which the Federal Reserve and other U.S. and non-U.S. regulators implement or reevaluate the regulatory framework applicable to our operations (as well as changes to that framework), including implementation or modification of the Dodd-Frank Act and related stress testing and resolution planning requirements and implementation of international standards applicable to financial institutions, such as those proposed by the Basel Committee and European legislation (such as Undertakings for Collective Investments in Transferable Securities (UCITS) V, the Money Market Fund Regulation and the Markets in Financial Instruments Directive (MiFID II)/Markets in Financial Instruments Regulation (MiFIR)); among other consequences, these regulatory changes impact the levels of regulatory capital, long-term debt and liquidity we must maintain, acceptable levels of credit exposure to third parties, margin requirements applicable to derivatives, restrictions on banking and financial activities and the manner in which we structure and implement our global operations and servicing relationships. In addition, our regulatory posture and related expenses have been and will continue to be affected by heightened standards and changes in regulatory expectations for global systemically important financial institutions applicable to, among other things, risk management, liquidity and capital planning, resolution planning and compliance programs, as well as changes in governmental enforcement approaches to perceived failures to comply with regulatory or legal obligations;
•
adverse changes in the regulatory ratios that we are, or will be, required to meet, whether arising under the Dodd-Frank Act or implementation of international standards applicable to financial institutions, such as those proposed by the Basel Committee, or due to changes in regulatory positions, practices or regulations in jurisdictions in which we engage in banking activities, including changes in internal or external data, formulae, models, assumptions or other advanced systems used in the calculation of our capital or liquidity ratios that cause changes in those ratios as they are measured from period to period;
 
•
requirements to obtain the prior approval or non-objection of the Federal Reserve or other U.S. and non-U.S. regulators for the use, allocation or distribution of our capital or other specific capital actions or corporate activities, including, without limitation, acquisitions, investments in subsidiaries, dividends and stock repurchases, without which our growth plans, distributions to shareholders, share repurchase programs or other capital or corporate initiatives may be restricted;
•
changes in law or regulation, or the enforcement of law or regulation, that may adversely affect our business activities or those of our clients or our counterparties, and the products or services that we sell, including, without limitation, additional or increased taxes or assessments thereon, capital adequacy requirements, margin requirements and changes that expose us to risks related to the adequacy of our controls or compliance programs;
•
economic or financial market disruptions in the U.S. or internationally, including those which may result from recessions or political instability; for example, the U.K.'s exit from the European Union or actual or potential changes in trade policy, such as tariffs or bilateral and multilateral trade agreements;
•
our ability to create cost efficiencies through changes in our operational processes and to further digitize our processes and interfaces with our clients, any failure of which, in whole or in part, may among other things, reduce our competitive position, diminish the cost-effectiveness of our systems and processes or provide an insufficient return on our associated investment;
•
our ability to promote a strong culture of risk management, operating controls, compliance oversight, ethical behavior and governance that meets our expectations and those of our clients and our regulators, and the financial, regulatory, reputational and other consequences of our failure to meet such expectations;
•
the impact on our compliance and controls enhancement programs associated with the appointment of a monitor under the deferred prosecution agreement with the DOJ and compliance consultant appointed under a settlement with the SEC, including the potential for such monitor and compliance consultant to require changes to our programs or to identify other issues that require substantial expenditures, changes in our operations, payments to clients or reporting to U.S. authorities;
•
the results of our review of our billing practices, including additional findings or amounts we may be required to reimburse clients, as well as

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potential consequences of such review, including damage to our client relationships or our reputation and adverse actions or penalties imposed by governmental authorities;
•
our ability to expand our use of technology to enhance the efficiency, accuracy and reliability of our operations and our dependencies on information technology; to replace and consolidate systems, particularly those relying upon older technology, and to adequately incorporate resiliency and business continuity into our systems management; to implement robust management processes into our technology development and maintenance programs; and to control risks related to use of technology, including cyber-crime and inadvertent data disclosures;
•
our ability to address threats to our information technology infrastructure and systems (including those of our third-party service providers); the effectiveness of our and our third party service providers' efforts to manage the resiliency of the systems on which we rely; controls regarding the access to, and integrity of, our and our clients' data; and complexities and costs of protecting the security of such systems and data;
•
the results of, and costs associated with, governmental or regulatory inquiries and investigations, litigation and similar claims, disputes, or civil or criminal proceedings;
•
changes or potential changes in the amount of compensation we receive from clients for our services, and the mix of services provided by us that clients choose;
•
the large institutional clients on which we focus are often able to exert considerable market influence and have diverse investment activities, and this, combined with strong competitive market forces, subjects us to significant pressure to reduce the fees we charge, to potentially significant changes in our AUC/A or our AUM in the event of the acquisition or loss of a client, in whole or in part, and to potentially significant changes in our revenue in the event a client re-balances or changes its investment approach, re-directs assets to lower- or higher-fee asset classes or changes the mix of products or services that it receives from us;
•
the potential for losses arising from our investments in sponsored investment funds;
 
•
the possibility that our clients will incur substantial losses in investment pools for which we act as agent; the possibility of significant reductions in the liquidity or valuation of assets underlying those pools and the potential that clients will seek to hold us liable for such losses; and the possibility that our clients or regulators will assert claims that our fees, with respect to such investment products, are not appropriate;
•
our ability to anticipate and manage the level and timing of redemptions and withdrawals from our collateral pools and other collective investment products;
•
the credit agency ratings of our debt and depositary obligations and investor and client perceptions of our financial strength;
•
adverse publicity, whether specific to us or regarding other industry participants or industry-wide factors, or other reputational harm;
•
our ability to control operational risks, data security breach risks and outsourcing risks; our ability to protect our intellectual property rights; the possibility of errors in the quantitative models we use to manage our business; and the possibility that our controls will prove insufficient, fail or be circumvented;
•
changes or potential changes to the competitive environment, due to, among other things, regulatory and technological changes, the effects of industry consolidation and perceptions of us, as a suitable service provider or counterparty;
•
our ability to complete acquisitions, joint ventures and divestitures, including, without limitation, our ability to obtain regulatory approvals, the ability to arrange financing as required and the ability to satisfy closing conditions;
•
the risks that our acquired businesses, including, without limitation, our acquisition of Charles River Systems, Inc. (CRD), and joint ventures will not achieve their anticipated financial, operational and product innovation benefits or will not be integrated successfully, or that the integration will take longer than anticipated; that expected synergies will not be achieved or unexpected negative synergies or liabilities will be experienced; that client and deposit retention goals will not be met; that other regulatory or operational challenges will be experienced; and that disruptions from the transaction will harm our relationships with our clients, our employees or regulators;

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•
our ability to integrate CRD's front office software solutions with our middle and back office capabilities to develop a front-to-middle-to-back office platform that is competitive, generates revenues in line with our expectations and meets our clients' requirements;
•
our ability to recognize evolving needs of our clients and to develop products that are responsive to such trends and profitable to us; the performance of and demand for the products and services we offer; and the potential for new products and services to impose additional costs on us and expose us to increased operational risk;
•
our ability to grow revenue, manage expenses, attract and retain highly skilled people and raise the capital necessary to achieve our business goals and comply with regulatory requirements and expectations;
•
changes in accounting standards and practices; and
•
the impact of the U.S. tax legislation enacted in 2017, and changes in tax legislation and in the interpretation of existing tax laws by U.S. and non-U.S. tax authorities that affect the amount of taxes due.
Actual outcomes and results may differ materially from what is expressed in our forward-looking statements and from our historical financial results due to the factors discussed in this section and elsewhere in this Form 10-Q or disclosed in our other SEC filings. Forward-looking statements in this Form 10-Q should not be relied on as representing our expectations or assumptions as of any time subsequent to the time this Form 10-Q is filed with the SEC. We undertake no obligation to revise our forward-looking statements after the time they are made. The factors discussed herein are not intended to be a complete statement of all risks and uncertainties that may affect our businesses. We cannot anticipate all developments that may adversely affect our business or operations or our consolidated results of operations, financial condition or cash flows.
Forward-looking statements should not be viewed as predictions, and should not be the primary basis on which investors evaluate State Street. Any investor in State Street should consider all risks and uncertainties disclosed in our SEC filings, including our filings under the Securities Exchange Act of 1934, in particular our annual reports on Form 10-K, our quarterly reports on Form 10-Q and our current reports on Form 8-K, or registration statements filed under the Securities Act of 1933, all of which are accessible on the SEC's website at www.sec.gov or on the “Investor Relations” section of our corporate website at www.statestreet.com.

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OVERVIEW OF FINANCIAL RESULTS
In the first quarter of 2019, we voluntarily changed our accounting method under Financial Accounting Standards Board (FASB) ASC 323, Investments-Equity Method and Joint Ventures, for investments in Low Income Housing Tax Credit (LIHTC) from the equity method of accounting to the proportional amortization method of accounting. The change was applied retrospectively and affects multiple financial statement line items. For additional information about changes in accounting, refer to Note 1 of our consolidated financial statements in this Form 10-Q.
TABLE 1: OVERVIEW OF FINANCIAL RESULTS
 
Three Months Ended March 31,
 
 
(Dollars in millions, except per share amounts)
2019
 
2018
 
% Change
Total fee revenue(1)(2)
$
2,260

 
$
2,415

 
(6
)%
Net interest income(1)
673

 
643

 
5

Gains (losses) related to investment securities, net
(1
)
 
(2
)
 
nm

Total revenue(2)
2,932

 
3,056

 
(4
)
Provision for loan losses
4

 
—

 
nm

Total expenses(2)
2,293

 
2,268

 
1

Income before income tax expense
635

 
788

 
(19
)
Income tax expense
127

 
129

 
(2
)
Net income
$
508

 
$
659

 
(23
)
Adjustments to net income:
 
 
 
 

Dividends on preferred stock(3)
$
(55
)
 
$
(55
)
 
—

Earnings allocated to participating securities(4)
(1
)
 
(1
)
 
—

Net income available to common shareholders
$
452

 
$
603

 
(25
)
Earnings per common share:
 
 
 
 

Basic
$
1.20

 
$
1.64

 
(27
)
Diluted
1.18

 
1.62

 
(27
)
Average common shares outstanding (in thousands):
Basic
377,915

 
367,439

 
3

Diluted
381,703

 
372,619

 
2

Cash dividends declared per common share
$
.47

 
$
.42

 
12

Return on average common equity
8.7
%
 
12.8
%
 
(410) bps
Pre-tax Margin
21.7

 
25.8

 
(410)
 
 
(1) In the first quarter of 2018, approximately $15 million of swap costs were reclassified from processing fees and other revenue within fee revenue to net interest income to conform to current presentation.
(2) CRD contributed approximately $99 million and $41 million in total revenue and total expenses, respectively, in the first quarter of 2019, including approximately $95 million in processing fees and other revenue and $4 million in brokerage and other trading services, within foreign exchange trading services, and expenses contributed approximately $31 million in compensation and employee benefits and $10 million in other expense lines. In addition, CRD-related expenses in the first quarter of 2019 include $15 million in amortization of other intangible assets.
(3) Additional information about our preferred stock dividends is provided in Note 12 to the consolidated financial statements in this Form 10-Q.
(4) Represents the portion of net income available to common equity allocated to participating securities, composed of unvested and fully vested SERP (Supplemental executive retirement plans) shares and fully vested deferred director stock awards, which are equity-based awards that contain non-forfeitable rights to dividends, and are considered to participate with the common stock in undistributed earnings.
nm Not meaningful
 
The following “Financial Results and Highlights” section provides information related to significant events, as well as highlights of our consolidated financial results in the first quarter of 2019 presented in Table 1: Overview of Financial Results. More detailed information about our consolidated financial results, including comparisons of our financial results in the first quarter of 2019 compared to the same period in 2018, is provided under “Consolidated Results of Operations”, "Line of Business Information" and "Capital" which follows these sections, as well as in our consolidated financial statements in this Form 10-Q. In this Management’s Discussion and Analysis, where we describe the effects of changes in FX rates, those effects are determined by applying applicable weighted average FX rates from the relevant 2018 period to the relevant 2019 period results.
Financial Results and Highlights
•
EPS of $1.18 in the first quarter of 2019 decreased 27% compared to $1.62 in the same period in 2018. The first quarter of 2019 includes the impact of the following notable items:
◦
Acquisition and restructuring costs of $9 million, consisting of acquisition costs related to CRD of $13 million, partially offset by a $4 million accrual release for restructuring; and
◦
Legal and related expenses of approximately $14 million.
•
We had no notable items in the first quarter of 2018.
•
In the first quarter of 2019, revenues were impacted by challenging industry conditions and lower average equity market levels, partially offset by CRD revenue and NII. In light of challenging market and industry headwinds, we are executing on our previously announced expense savings program.
•
In the first quarter of 2019, return on equity of 8.7% decreased from 12.8% in the same period in 2018. Pre-tax margin of 21.7% in the first quarter of 2019 decreased from 25.8% in the same period in 2018.
•
Operating leverage was (5.2)% in the first quarter of 2019. Operating leverage represents the difference between the percentage change in total revenue and the percentage change in total expenses, in each case relative to the prior year period.

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•
We repurchased $300 million of our common stock in the first quarter of 2019 under our previously announced common stock purchase program (the 2018 Program). We may repurchase up to $300 million of our common stock under the 2018 Program in the second quarter of 2019.
Revenue
•
Total revenue and fee revenue decreased 4% and 6%, respectively, in the first quarter of 2019 compared to the same period of 2018, primarily driven by lower servicing fees, lower management fees, and lower markets revenues, partially offset by higher processing fees and other revenues, and, in the case of total revenue, by higher NII. Processing fees and other revenues in the first quarter of 2019 include revenue from CRD, which we acquired in October 2018.
◦
Total revenues contributed by CRD in the first quarter of 2019 were approximately $99 million, including $95 million in processing fees and other revenue, of which approximately $3 million were project-related fees associated with State Street Global Advisors, and $4 million in brokerage and other trading services, within foreign exchange trading services.
•
Servicing fee revenue decreased 12% in the first quarter of 2019 compared to the same period in 2018, primarily due to challenging industry conditions including fee concessions, lower client activity and flows, weaker average equity market levels and a previously announced client transition, partially offset by new business.
•
Management fee revenue decreased 11% in the first quarter of 2019 compared to the same period in 2018, reflecting product mix and weaker average equity market levels.
•
Foreign exchange trading services decreased 8% in the first quarter of 2019 compared to the same period in 2018 due to lower client volumes and market volatility.
•
Securities finance revenue decreased 16% in the first quarter of 2019 compared to the same period in 2018, reflecting a balance sheet repositioning initiative in the second half of 2018.
•
Processing fees and other revenue increased 148% in the first quarter of 2019 compared to the same period in 2018, primarily due to $95 million in the first quarter of 2019 from CRD, which we acquired in October 2018.
 
•
NII increased 5% in the first quarter of 2019 compared to the same period in 2018, primarily due to higher U.S. interest rates and disciplined liability pricing, partially offset by lower average deposit balances.
Expenses
•
Total expenses increased 1% in the first quarter of 2019 compared to the same period in 2018, primarily driven by technology infrastructure spend and the impact of the CRD acquisition, partially offset by savings associated with our 2019 expense savings program through resource discipline, process re-engineering and automation benefits.
◦
Total expenses contributed by CRD in the first quarter of 2019 were approximately $41 million, including $31 million in compensation and employee benefits, and $10 million in other expense lines. In addition, CRD-related expenses in the first quarter of 2019 included $15 million in amortization of other intangible assets.
◦
In the first quarter of 2019, we achieved approximately $78 million of gross expense savings related to our previously announced $350 million 2019 expense savings program through expense savings of $31 million in resource discipline and $47 million in process re-engineering and automation benefits.
AUC/A and AUM
•
AUC/A decreased 2% as of March 31, 2019 compared to March 31, 2018, primarily due to the negative impact of FX translation and a previously announced client transition. In the first quarter of 2019, newly announced asset servicing mandates totaled approximately $120 billion. Servicing assets remaining to be installed in future periods totaled approximately $310 billion as of March 31, 2019.
•
AUM increased 3% as of March 31, 2019 compared to March 31, 2018, primarily driven by higher equity markets, growth from institutional and ETF inflows, partially offset by year-end cash outflows.

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Capital
•
In the first quarter of 2019, we returned a total of approximately $480 million to our shareholders in the form of common stock dividends and share purchases.
◦
We declared aggregate common stock dividends of $0.47 per share, totaling $177 million in the first quarter of 2019, compared to $0.42 per share, totaling $154 million in the first quarter of 2018, representing an increase of approximately 12% on a per share basis.
◦
In the first quarter of 2019, we acquired 4.2 million shares of common stock at an average per share cost of $70.93 and an aggregate cost of approximately $300 million under the 2018 Program.
•
Our standardized CET1 capital ratio decreased to 11.5% as of March 31, 2019 compared to 11.7% as of December 31, 2018, and Tier 1 leverage ratio increased to 7.4% as of March 31, 2019 compared to 7.2% as of December 31, 2018.


 
CONSOLIDATED RESULTS OF OPERATIONS
This section discusses our consolidated results of operations in the first quarter of 2019 compared to the same period in 2018, and should be read in conjunction with the consolidated financial statements and accompanying condensed notes to the consolidated financial statements in this Form 10-Q.
Total Revenue
TABLE 2: TOTAL REVENUE
 
Three Months Ended March 31,
 
 
(Dollars in millions)
2019
 
2018
 
% Change
Fee revenue:
 
 
 
 
 
Servicing fees
$
1,251

 
$
1,421

 
(12
)%
Management fees
420

 
472

 
(11
)
Foreign exchange trading services(1)
280

 
304

 
(8
)
Securities finance
118

 
141

 
(16
)
Processing fees and other(1)
191

 
77

 
148

Total fee revenue(1)
2,260

 
2,415

 
(6
)
Net interest income:
 
 
 
 

Interest income
1,027

 
857

 
20

Interest expense
354

 
214

 
65

Net interest income
673

 
643

 
5

Gains (losses) related to investment securities, net
(1
)
 
(2
)
 
nm

Total revenue(1)
$
2,932

 
$
3,056

 
(4
)
 
 
(1) CRD contributed approximately $99 million in total revenue for the first quarter of 2019, including approximately $95 million in processing fees and other revenue and $4 million in brokerage and other trading services within foreign exchange trading services.
nm Not meaningful
Fee Revenue
Table 2: Total Revenue, provides the breakout of fee revenue in the first quarters of 2019 and 2018. Servicing and management fees collectively made up approximately 74% of the total fee revenue in both the first quarter of 2019 and 2018.
Servicing Fee Revenue
Generally, our servicing fee revenues are affected by several factors including changes in market valuations, client activity and asset flows, net new business and the manner in which we price our services. We provide a range of services to our clients, including core custody services, accounting, reporting and administration and middle office services, and the nature and mix of services provided affects our servicing fees. The basis for fees will differ across regions and clients. On average and over time, approximately 55% of our servicing fee revenues have been variable due to changes in asset valuations including changes in daily average valuations of AUC/A; another 15% of our servicing fees are impacted by the volume of activity in the funds we serve; and the remaining 30% of our servicing fees tend not to be variable in nature nor impacted by market fluctuations or values.

State Street Corporation | 11

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Changes in Market Valuations
Our servicing fee revenue is impacted by both our levels of and the geographic and product mix of our AUC/A. Increases or decreases in market valuations have a corresponding impact on the level of our AUC/A and servicing fee revenues, though the degree of impact will vary depending on asset types and classes and geography of assets held within our clients’ portfolios.
Over the five years ended December 31, 2018, we estimate that worldwide market valuations impacted our servicing fee revenues by approximately (2%) to 5% annually. See Table 3: Daily, Month-End and Quarter-End Equity Indices for selected indices. While the specific indices presented are indicative of general market trends, the asset types and classes relevant to individual client portfolios can and do differ, and the performance of associated relevant indices and of client portfolios can therefore differ from the performance of the indices presented. In addition, our asset classifications may differ from those industry classifications presented.
 
We estimate, using relevant information as of March 31, 2019 and assuming that all other factors remain constant, that:
•
A 10% increase or decrease in worldwide equity valuations, on a weighted average basis, over the relevant periods for which our servicing fees are calculated, would result in a corresponding change in our total servicing fee revenues, on average and over time, of approximately 3%; and
•
A 10% increase or decrease in worldwide fixed income valuations, on a weighted average basis, over the relevant periods for which our servicing fees are calculated, would result in a corresponding change in our total servicing fee revenues, on average and over time, of approximately 1%.
TABLE 3: DAILY AVERAGES, MONTH-END AVERAGES AND QUARTER-END EQUITY INDICES(1)
 
Daily Averages of Indices
 
Month-End Averages of Indices
 
Quarter-End Indices
 
Three Months Ended March 31,
 
Three Months Ended March 31,
 
Three Months Ended March 31,
 
2019
 
2018
 
% Change
 
2019
 
2018
 
% Change
 
2019
 
2018
 
% Change
S&P 500®
2,721

 
2,733

 
—
 %
 
2,774

 
2,726

 
2
 %
 
2,834

 
2,641

 
7
 %
MSCI EAFE®
1,833

 
2,072

 
(12
)
 
1,860

 
2,070

 
(10
)
 
1,875

 
2,006

 
(7
)
MSCI® Emerging Markets

1,033

 
1,204

 
(14
)
 
1,053

 
1,207

 
(13
)
 
1,058

 
1,171

 
(10
)
HFRI Asset Weighted Composite®
NA

 
NA

 
NA

 
1,413

 
1,409

 
—

 
1,425

 
1,398

 
2

 
 
 
(1) The index names listed in the table are service marks of their respective owners.
NA Not applicable
Client Activity and Asset Flows
Client activity and asset flows are impacted by the number of transactions we execute on behalf of our clients, including FX settlements, equity and derivative trades, and wire transfer activity, as well as actions by our clients to change the asset class in which their assets are invested. Our servicing fee revenues are impacted by a number of factors, including transaction volumes, asset levels and asset classes in which funds are invested, as well as industry trends associated with these client-related activities.
Our clients may change the asset classes in which their assets are invested, based on their market outlook,
 
risk acceptance tolerance or other considerations. Over the five years ended December 31, 2018, we estimate that client activity and asset flows, together, impacted our servicing fee revenues by approximately (1%) to 2% annually. See Table 4: Industry Asset Flows for selected asset flow information. While the asset flows presented are indicative of general market trends, the asset types and classes relevant to individual client portfolios can and do differ, and our flows may differ from those market trends. In addition, our asset classifications may differ from those industry classifications presented.

State Street Corporation | 12

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


TABLE 4: INDUSTRY ASSET FLOWS
 
Three Months Ended March 31,
(In billions)
2019
 
2018
North America - ICI Market Data(1)(2)
 
 
Long-Term Funds(3)
$
47.3

 
$
38.0

Money Market
54.0

 
(52.2
)
Exchange-Traded Fund
43.3

 
62.8

Total ICI Flows
$
144.6

 
$
48.6

 
 
 
 
Europe - Broadridge Market Data(1)(4)(5)
 
 
Long-Term Funds(3)
$
(50.0
)
 
$
160.5

Money Market
19.8

 
(10.3
)
Total Broadridge Flows
$
(30.2
)
 
$
150.2

 
 
 
(1) Industry data is provided for illustrative purposes only and is not intended to reflect our activity or its clients' activity.
(2) Source: Investment Company Institute. Investment Company Institute (ICI) data includes funds not registered under the Investment Company Act of 1940. Mutual fund data represents estimates of net new cash flow, which is new sales minus redemptions combined with net exchanges, while ETF data represents net issuance, which is gross issuance less gross redemptions. Data for mutual funds that invest primarily in other mutual funds and ETFs that invest primarily in other ETFs were excluded from the series. ICI classifies mutual funds and ETFs based on language in the fund prospectus.
(3) The long-term fund flows reported by ICI are composed of North America Market flows mainly in Equities, Hybrids and Fixed-Income Asset Classes. The long-term fund flows reported by Broadridge are composed of the European, Middle-Eastern, and African market flows mainly in Equities, Fixed-Income and Multi Asset Classes.
(4) Source: © Copyright 2018, Broadridge Financial Solutions, Inc. Funds of funds have been excluded from Broadridge data (to avoid double counting). Therefore, a market total is the sum of all the investment categories excluding the three funds of funds categories (in-house, ex-house and hedge). ETFs are included in Broadridge’s database on mutual funds, but this excludes exchange-traded commodity products that are not mutual funds.
(5) The first quarter of 2019 data is on a rolling 3 month basis and includes December 2018, January and February 2019 for EMEA (Copyright 2018 Broadridge Financial Solutions, Inc.).
Pricing
The industry in which we operate has historically faced pricing pressure, and our servicing fee revenues are also affected by such pressures today. On average, over the five years ended December 31, 2018, we estimate that pricing pressure with respect to existing clients has impacted our servicing fees by approximately (2%) annually, with the impact ranging from (1%) to (4%) in any given year. Pricing concessions can be a part of a contract renegotiation with a client including terms that may benefit us, such as extending the terms of our relationship with the client, expanding the scope of services that we provide or reducing our dependency on manual processes through the standardization of the services we provide. The timing of the impact of additional revenue generated by such additional services, and the amount of revenue generated, may differ from the impact of pricing concessions on existing services due to the necessary time required to onboard those new services and the nature of those services. These same market pressures also impact the fees we negotiate when we win business from new clients.
Net New Business
Over the five years ended December 31, 2018, net new business, which includes business both won and lost, has affected our servicing fee revenues by approximately 2% on average with a range of 1% to 3% annually. New business can include: custody; product and participant level accounting; daily valuation and administration; record-keeping; cash management; FX, brokerage and other trading services; securities finance; and other services. Revenues associated with new servicing mandates may vary based on the breadth
 
of services provided, the time required to install the assets, and the types of assets installed.
Management Fee Revenue
Management fees generally are affected by our level of AUM, which we report based on month-end valuations. Management fees for certain components of managed assets, such as ETFs, mutual funds and UCITS, are affected by daily average valuations of AUM. Management fee revenue is more sensitive to market valuations than servicing fee revenue, as a higher proportion of the underlying services provided, and the associated management fees earned, are dependent on equity and fixed-income security valuations. Additional factors, such as the relative mix of assets managed, may have a significant effect on our management fee revenue. While certain management fees are directly determined by the values of AUM and the investment strategies employed, management fees may reflect other factors, including performance fee arrangements, as well as our relationship pricing for clients.
Asset-based management fees for actively managed products are generally charged at a higher percentage of AUM than for passive products. Actively managed products may also include performance fee arrangements which are recorded when the fee is earned, based on predetermined benchmarks associated with the applicable account's performance.

State Street Corporation | 13

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


In light of the above, we estimate, using relevant information as of March 31, 2019 and assuming that all other factors remain constant, including the impact of business won and lost and client flows, that:
•
A 10% increase or decrease in worldwide equity valuations, on a weighted average basis, over the relevant periods for which our management fees are calculated, would result in a corresponding change in our total management fee revenues, on average and over time, of approximately 5%; and
•
A 10% increase or decrease in worldwide fixed-income valuations, on a weighted average basis, over the relevant periods for which our management fees are calculated, would result in a corresponding change in our total management fee revenues, on average and over time, of approximately 4%.
Daily averages, month-end averages and quarter-end indices demonstrate worldwide changes in equity and debt markets that affect our management fee revenue. Quarter-end indices affect the values of AUM as of those dates. See Table 3: Daily Averages, Month-End Averages and Quarter-End Equity Indices for selected indices.
Additional information about fee revenue is provided under "Line of Business Information" included in this Management's Discussion and Analysis.

State Street Corporation | 14

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Net Interest Income
See Table 2: Total Revenue, for the breakout of interest income and interest expense in the first quarters of 2019 and 2018. NII was $673 million in the first quarter of 2019 compared to $643 million in the same period in 2018.
NII is defined as interest income earned on interest-earning assets less interest expense incurred on interest-bearing liabilities. Interest-earning assets, which principally consist of investment securities, interest-bearing deposits with banks, resale agreements, loans and leases and other liquid assets, are financed primarily by client deposits, short-term borrowings and long-term debt.
NIM represents the relationship between annualized FTE NII and average total interest-earning assets for the period. It is calculated by dividing FTE NII by average interest-earning assets. Revenue that is exempt from income taxes, mainly earned from certain investment securities (state and political subdivisions), is adjusted to a FTE basis using the U.S. federal and state statutory income tax rates.
See Table 5: Average Balances and Interest Rates - Fully Taxable-Equivalent Basis, for the breakout of NII on a FTE basis for the first quarters of 2019 and 2018. NII on a FTE basis increased in the first quarter of 2019 compared to the same period in 2018, primarily due to higher U.S. interest rates and disciplined liability pricing, partially offset by lower average deposit balances.
TABLE 5: AVERAGE BALANCES AND INTEREST RATES - FULLY TAXABLE-EQUIVALENT BASIS(1)
 
Three Months Ended March 31,
 
2019
 
2018
(Dollars in millions; fully taxable-equivalent basis)
Average
Balance
 
Interest
Revenue/
Expense
 
Average Rates
 
Average
Balance
 
Interest
Revenue/
Expense
 
Average Rates
Interest-bearing deposits with banks
$
48,856

 
$
119

 
0.99
%
 
$
51,492

 
$
82

 
0.64
%
Securities purchased under resale agreements(2)

2,775

 
98

 
14.33

 
2,872

 
77

 
10.89

Trading account assets
866

 
—

 
—

 
1,138

 
—

 
—

Investment securities
88,273

 
507

 
2.30

 
95,362

 
484

 
2.03

Loans and leases
23,056

 
199

 
3.49

 
23,959

 
158

 
2.68

Other interest-earning assets
15,286

 
109

 
2.89

 
17,733

 
77

 
1.78

Average total interest-earning assets
$
179,112

 
$
1,032

 
2.34

 
$
192,556

 
$
878

 
1.85

Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
 
 
U.S.
$
64,531

 
$
132

 
0.83

 
$
48,638

 
$
34

 
0.28

Non-U.S.(3)(4)
59,775

 
39

 
0.26

 
78,582

 
29

 
0.15

Total interest-bearing deposits(3)(5)
124,306

 
171

 
0.56

 
127,220

 
63

 
0.20

Securities sold under repurchase agreements
1,773

 
12

 
2.66

 
2,617

 
—

 
—

Other short-term borrowings
1,157

 
4

 
1.34

 
1,255

 
3

 
1.09

Long-term debt
10,955

 
106

 
3.89

 
11,412

 
97

 
3.37

Other interest-bearing liabilities
4,642

 
61

 
5.31

 
5,260

 
51

 
3.87

Average total interest-bearing liabilities
$
142,833

 
$
354

 
1.00

 
$
147,764

 
$
214

 
0.59

Interest rate spread
 
 
 
 
1.34

 
 
 
 
 
1.26

Net interest income-fully taxable-equivalent basis
 
 
$
678

 
 
 
 
 
$
664

 
 
Net interest margin-fully taxable-equivalent basis
 
 
 
 
1.54

 
 
 
 
 
1.40

Tax-equivalent adjustment
 
 
(5
)
 
 
 
 
 
(21
)
 
 
Net interest income-GAAP basis
 
 
$
673

 
 
 
 
 
$
643

 
 
 
 
(1) Rates earned/paid on interest-earning assets and interest-bearing liabilities include the impact of hedge activities associated with our asset and liability management activities where applicable.
(2) Reflects the impact of balance sheet netting under enforceable netting agreements of approximately $59.20 billion in the first quarter of 2019 compared to $32.18 billion in the same period in 2018. Excluding the impact of netting, the average interest rates would be approximately 0.64% in the first quarter of 2019 compared to 0.89% in the same period in 2018.
(3) Average rate includes the impact of FX swap costs of approximately $39 million in the first quarter of 2019 compared to $34 million in the same period in 2018. Average rates for total interest-bearing deposits excluding the impact of FX swap costs were 0.43% in the first quarter of 2019 compared to 0.09% in the same period in 2018.
(4) In the first quarter of 2018, approximately $15 million of swap costs were reclassified from processing fees and other revenue within fee revenue to net interest income to conform to current presentation.
(5) Total deposits averaged $155.34 billion in the first quarter of 2019 compared to $165.01 billion in the same period in 2018.

State Street Corporation | 15

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Changes in the components of interest-earning assets and interest-bearing liabilities are discussed in more detail below. Additional information about the components of interest income and interest expense is provided in Note 14 to the consolidated financial statements in this Form 10-Q.
Average total interest-earning assets were $179.11 billion in the first quarter of 2019 compared to $192.56 billion in the same period in 2018. The decrease is largely driven by lower average client deposits, which includes both interest-bearing and non-interest-bearing deposits.
Interest-bearing deposits with banks averaged $48.86 billion in the first quarter of 2019 compared to $51.49 billion in the same period in 2018. These deposits primarily reflect our maintenance of cash balances at the Federal Reserve, the European Central Bank (ECB) and other non-U.S. central banks.
Securities purchased under resale agreements averaged $2.78 billion in the first quarter of 2019 compared to $2.87 billion in the same period in 2018. While the on-balance sheet amount has remained stable, the impact of balance sheet netting has increased to $59.20 billion in the first quarter of 2019 compared to $32.18 billion in the same period in 2018. We maintain an agreement with the Fixed Income Clearing Corporation (FICC), a clearing organization that enables us to net all securities sold under repurchase agreements against those purchased under resale agreements with counterparties that are also members of the clearing organization. The increase in balance sheet netting, in the first quarter of 2019 compared to the same period in 2018, is primarily due to the expansion of our program with the FICC and new client activity.
Investment securities averaged $88.27 billion in the first quarter of 2019 compared to $95.36 billion in the same period in 2018. The decrease in average investment securities was primarily driven by our investment repositioning strategy to prioritize capital efficient client lending while managing OCI sensitivity.
Loans and leases averaged $23.06 billion in the first quarter of 2019 compared to $23.96 billion in the same period in 2018.
Average other interest-earning assets, largely associated with our enhanced custody business, decreased to $15.29 billion in the first quarter of 2019 from $17.73 billion in the same period in 2018, primarily driven by a reduction in the level of cash collateral posted. Enhanced custody is our securities financing business where we act as principal with respect to our custody clients and generate securities finance revenue. The NII earned on these transactions is generally lower than the interest earned on other alternative investments.
 
Aggregate average total interest-bearing deposits decreased to $124.31 billion in the first quarter of 2019 from $127.22 billion in the same period in 2018. Average U.S. interest-bearing deposits increased as a result of a gradual shift from non-interest bearing deposits and a reclassification from non-U.S. into U.S. interest-bearing deposits that occurred in the third quarter of 2018. The overall decrease was primarily driven by lower client deposit levels. Future deposit levels will be influenced by the underlying asset servicing business, client deposit behavior and market conditions, including the general levels of U.S. and non-U.S. interest rates.
Average other short-term borrowings, largely associated with our tax-exempt investment program, decreased to $1.16 billion in the first quarter of 2019 from $1.26 billion in the same period in 2018.
Average long-term debt was $10.96 billion in the first quarter of 2019 compared to $11.41 billion in the same period in 2018. These amounts reflect issuances and maturities of senior debt during the respective periods.
Average other interest-bearing liabilities were $4.64 billion in the first quarter of 2019 compared to $5.26 billion in the same period in 2018. Other interest-bearing liabilities primarily reflect our level of cash collateral received from clients in connection with our enhanced custody business, which is presented on a net basis where we have enforceable netting agreements.
Several factors could affect future levels of NII and NIM, including the volume and mix of client deposits and funding sources; central bank actions; balance sheet management activities; changes in the level and slope of U.S. and non-U.S. interest rates; revised or proposed regulatory capital or liquidity standards, or interpretations of those standards; the yields earned on securities purchased compared to the yields earned on securities sold or matured and changes in the type and amount of credit or other loans we extend.
Based on market conditions and other factors, including regulatory standards, we continue to reinvest the majority of the proceeds from pay-downs and maturities of investment securities in highly-rated U.S. and non-U.S. securities, such as U.S. Treasury and agency securities, sovereign debt securities and federal agency MBS. The pace at which we reinvest and the types of investment securities purchased will depend on the impact of market conditions, the implementation of regulatory standards, including interpretation of those standards and other factors over time. We expect these factors and the levels of global interest rates to impact our reinvestment program and future levels of NII and NIM.

State Street Corporation | 16

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Expenses
Table 6: Expenses, provides the breakout of expenses in the first quarters of 2019 and 2018.
TABLE 6: EXPENSES
 
 
 
Three Months Ended March 31,
 
% Change
(Dollars in millions)
2019
 
2018
 
Compensation and employee benefits(1)
$
1,229

 
$
1,249

 
(2
)%
Information systems and communications
362

 
315

 
15

Transaction processing services
242

 
254

 
(5
)
Occupancy
116

 
120

 
(3
)
Acquisition costs
13

 
—

 
nm

Restructuring charges, net
(4
)
 
—

 
nm

Amortization of other intangible assets(1)
60

 
50

 
20

Other:
 
 
 
 
 
Professional services
80

 
79

 
1

Regulatory fees and assessments
18

 
27

 
(33
)
Other
177

 
174

 
2

Total other
275

 
280


(2
)
Total expenses(1)
$
2,293

 
$
2,268


1

Number of employees at quarter-end
39,969

 
37,192

 
7

 
 
(1) CRD contributed approximately $41 million in total expenses in the first quarter of 2019, including approximately $31 million in compensation and employee benefits, and $10 million in other expense lines. In addition, CRD-related expenses in the first quarter of 2019 include $15 million in amortization of other intangible assets.
nm Not meaningful
Compensation and employee benefits expenses decreased 2% in the first quarter of 2019 compared to the same period in 2018, partially due to lower seasonal deferred incentive compensation expenses for retirement eligible employees and related payroll taxes. These seasonal expenses were $137 million in the first quarter of 2019 compared to $148 million in the same period in 2018. The decrease is also a result of lower contractor service costs in the first quarter of 2019 compared to the same period in 2018, and is partially offset by $31 million of CRD compensation and employee benefits expenses in the first quarter of 2019 and annual merit increases.
Headcount increased 7% in the first quarter of 2019 compared to the same period in 2018, primarily driven by growth in our low cost locations and the impact of CRD, partially offset by a reduction in headcount in our high cost locations. Total headcount decreased by approximately 0.5% as of March 31, 2019 compared to December 31, 2018, primarily driven by a reduction in high cost locations headcount.
Information systems and communications expenses increased 15% in the first quarter of 2019 compared to the same period in 2018. The increase was primarily related to technology infrastructure enhancements.
 
Transaction processing services expenses decreased 5% in the first quarter of 2019 compared to the same period in 2018, due to lower sub-custodian costs.
Occupancy expenses decreased 3% in the first quarter of 2019 compared to the same period in 2018, primarily driven by the advancement of our global footprint strategy.
Amortization of other intangible assets increased 20% in the first quarter of 2019 compared to the same period in 2018, primarily due to the CRD acquisition.
Other expenses decreased 2% in the first quarter of 2019 compared to the same period in 2018, primarily due to lower travel and insurance costs.
As a systemically important financial institution, we are subject to enhanced supervision and prudential standards. Our status as a G-SIB has also resulted in heightened prudential and conduct expectations of our U.S. and international regulators with respect to our capital and liquidity management and our compliance and risk oversight programs. These heightened expectations have increased our regulatory compliance costs, including personnel, technology and systems, as well as significant additional implementation and related costs to enhance our regulatory compliance programs. Regulatory compliance requirements are anticipated to remain at least at the elevated levels we have experienced over the past several years.
Acquisition Costs
We recorded approximately $13 million of acquisition costs in the first quarter of 2019 related to our acquisition of CRD. As we integrate CRD into our business, we expect to incur a total of approximately $200 million of acquisition costs, including merger and integration costs, through 2021, out of which $44 million has been incurred as of March 31, 2019.

State Street Corporation | 17

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Restructuring and Repositioning Charges
Repositioning Charges
In 2018, we initiated a new expense program to accelerate efforts to become a higher-performing organization and help navigate challenging market and industry conditions. Through our new expense savings program, we expect to realize $350 million in gross expense savings in 2019. In the first quarter of 2019, we achieved approximately $78 million of gross expense savings, including $31 million in resource discipline and $47 million in process re-engineering and automation benefits. Resource discipline benefits can include reducing senior management headcount, rigorous performance management, vendor management and optimization of real estate. Process re-engineering and automation benefits can include high-cost location workforce reductions, reducing manual/bespoke and redundant activities, streamlining operational centers and moving to common platforms/retiring legacy applications.
Beacon
In the first quarter of 2019, we released $4 million of restructuring accruals related to Beacon as the program continues to wind down. We recorded no restructuring charges in the same period in 2018.
The following table presents aggregate restructuring and repositioning activity for the periods indicated:
TABLE 7: RESTRUCTURING AND REPOSITIONING CHARGES
(In millions)
Employee
Related Costs
 
Real Estate
Actions
 
Asset and Other Write-offs
 
Total
Accrual balance at December 31, 2017
$
166

 
$
32

 
$
3

 
$
201

Accruals for Beacon
—


—


—

 
—

Payments and other adjustments
(22
)

(4
)

—

 
(26
)
Accrual balance at March 31, 2018
$
144

 
$
28

 
$
3

 
$
175

Accrual balance at December 31, 2018
$
303


$
37


$
1

 
$
341

Accruals for Beacon
(4
)

—


—

 
(4
)
Payments and other adjustments
(53
)

(25
)

—

 
(78
)
Accrual balance at March 31, 2019
$
246

 
$
12

 
$
1

 
$
259

Income Tax Expense
Income tax expense was $127 million in the first quarter of 2019 compared to $129 million in the same period in 2018. Our effective tax rate in the first quarter of 2019 was 20.1% compared to 16.4% in the same period in 2018. The effective tax rate in the first quarter of 2019 included a decrease in excess deductions related to stock based compensation. The effective tax rate in the first quarter of 2018 included one-time benefits related to audit settlements and the realization of a tax loss.
 
LINE OF BUSINESS INFORMATION
Our operations are organized into two lines of business: Investment Servicing and Investment Management, which are defined based on products and services provided. The results of operations for these lines of business are not necessarily comparable with those of other companies, including companies in the financial services industry.
Investment Servicing provides services for institutional clients, including mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, investment managers, foundations and endowments worldwide. Products include: custody; product- and participant-level accounting; daily pricing and administration; master trust and master custody; record-keeping; cash management; FX, brokerage and other trading services; securities finance; our enhanced custody product, which integrates principal securities lending and custody; deposit and short-term investment facilities; loans and lease financing; investment manager and alternative investment manager operations outsourcing; and performance, risk and compliance analytics to support institutional investors. Products and services related to CRD include: portfolio modeling and construction; trade order management; investment risk and compliance; and wealth management solutions.
Investment Management, through State Street Global Advisors, provides a broad range of investment management strategies and products for our clients. Our investment management strategies and products span the risk/reward spectrum, including core and enhanced indexing, multi-asset strategies, active quantitative and fundamental active capabilities and alternative investment strategies. Our AUM is currently primarily weighted to indexed strategies. In addition, we provide a breadth of services and solutions, including environmental, social and governance investing, defined benefit and defined contribution and Outsourced Chief Investment Officer. State Street Global Advisors is also a provider of ETFs, including the SPDR® ETF brand. While management fees are primarily determined by the values of AUM and the investment strategies employed, management fees reflect other factors as well, including the benchmarks specified in the respective management agreements related to performance fees.
For information about our two lines of business, as well as the revenues, expenses and capital allocation methodologies associated with them, refer to Note 18 to the consolidated financial statements in this Form 10-Q.

State Street Corporation | 18

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Investment Servicing
TABLE 8: INVESTMENT SERVICING LINE OF BUSINESS RESULTS
(Dollars in millions)
Three Months Ended March 31,
 
 
2019
 
2018
 
% Change
Servicing fees
$
1,251

 
$
1,421

 
(12
)%
Foreign exchange trading services
246

 
274

 
(10
)
Securities finance
117

 
141

 
(17
)
Processing fees and other(1)
180

 
77

 
134

Total fee revenue(1)
1,794

 
1,913

 
(6
)
Net interest income
679

 
648

 
5

Gains (losses) related to investment securities, net
(1
)
 
(2
)
 
nm

Total revenue(1)
2,472

 
2,559

 
(3
)
Provision for loan losses
4

 
—

 
nm

Total expenses
1,864

 
1,870

 
—

Income before income tax expense
$
604

 
$
689

 
(12
)
Pre-tax margin
24
%
 
27
%
 
 
 
 
 
(1) CRD contributed approximately $99 million and $41 million in total revenue and total expenses, respectively, in the first quarter of 2019, including approximately $95 million in processing fees and other revenue and $4 million in brokerage and other trading services within foreign exchange trading services, and expenses contributed approximately $31 million in compensation and employee benefits and $10 million in other expense lines. In addition, CRD-related expenses in the first quarter of 2019 include $15 million in amortization of other intangible assets.
nm Not meaningful
 
Servicing Fees
Servicing fees decreased 12% in the first quarter of 2019 compared to the same period in 2018, primarily due to challenging industry conditions including fee concessions, lower client activity and flows, weaker average equity market levels and a previously announced client transition, partially offset by new business. Servicing fees, excluding the impact of FX rates, decreased 10% in the first quarter of 2019 compared to the same period in 2018.
Servicing fees generated outside the U.S. were approximately 46% of total servicing fees in the first quarter of both 2019 and 2018.
TABLE 9: ASSETS UNDER CUSTODY AND/OR ADMINISTRATION BY PRODUCT
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
Collective funds
$
9,436

 
$
8,999

 
$
9,908

Mutual funds
8,586

 
7,912

 
7,503

Insurance and other products
8,108

 
8,220

 
9,071

Pension products
6,513

 
6,489

 
6,802

Total
$
32,643

 
$
31,620

 
$
33,284

TABLE 10: ASSETS UNDER CUSTODY AND/OR ADMINISTRATION BY ASSET CLASS
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
Equities
$
18,924

 
$
18,041

 
$
19,198

Fixed-income
9,831

 
9,758

 
10,186

Short-term and other investments
3,888

 
3,821

 
3,900

Total
$
32,643

 
$
31,620

 
$
33,284

TABLE 11: ASSETS UNDER CUSTODY AND/OR ADMINISTRATION BY GEOGRAPHY(1)
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
Americas
$
23,979

 
$
23,203

 
$
24,336

Europe/Middle East/Africa
6,875

 
6,699

 
7,211

Asia/Pacific
1,789

 
1,718

 
1,737

Total
$
32,643

 
$
31,620

 
$
33,284

 
 
(1) Geographic mix is generally based on the domicile of the entity servicing the funds and is not necessarily representative of the underlying asset mix.
Asset servicing mandates newly announced in the first quarter of 2019 totaled approximately $120 billion. Servicing assets remaining to be installed in future periods totaled approximately $310 billion as of March 31, 2019, which will be reflected in AUC/A in future periods after installation and will generate servicing fee revenue in subsequent periods. The full revenue impact
 
of such mandates will be realized over several quarters as the assets are installed and additional services are added over that period.
New asset servicing mandates and servicing assets remaining to be installed in future periods exclude certain new business which has been contracted, but for which the client has not yet provided

State Street Corporation | 19

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


permission to publicly disclose and the expected installation date extends beyond one quarter. These excluded assets, which from time to time may be significant, will be included in new asset servicing mandates and reflected in servicing assets remaining to be installed in the period in which the client provides its permission. Servicing mandates and servicing assets remaining to be installed in future periods are presented on a gross basis and therefore also do not include the impact of clients who have notified us during the period of their intent to terminate or reduce their relationship with us, which may from time to time be significant.
With respect to these new servicing mandates, once installed we may provide various services, including, accounting, bank loan servicing, compliance reporting and monitoring, custody, depository banking services, FX, fund administration, hedge fund servicing, middle office outsourcing, performance and analytics, private equity administration, real estate administration, securities finance, transfer agency and wealth management services. Revenues associated with new servicing mandates may vary based on the breadth of services provided and the timing of installation, and the types of assets.
For additional information about the impact of worldwide equity and fixed-income valuations on our fee revenue, as well as other key drivers of our servicing fee revenue, refer to "Fee Revenue" in "Consolidated Results of Operations" included in this Management's Discussion and Analysis.
As a result of a decision to diversify providers, one of our large clients has moved a portion of its assets, largely common trust funds, to another service provider. We remain a significant service provider to this client. The transition, which began in 2018 and is largely complete, represents approximately $1 trillion in assets with respect to which we no longer derive revenue post-transition.
Foreign Exchange Trading Services
Foreign exchange trading services revenue, as presented in Table 8: Investment Servicing Line of Business Results, decreased 10% in the first quarter of 2019 compared to the same period in 2018, primarily due to lower FX client volumes and market volatility. Foreign exchange trading services is composed of revenue generated by FX trading, as well as revenue generated by brokerage and other trading services. FX trading and brokerage and other trading services represented approximately 57% and 43%, respectively, of our total foreign exchange trading services revenue in the first quarter of 2019, compared to 60% and 40%, respectively, in the same period in 2018.
We primarily earn FX trading revenue by acting as a principal market-maker through both "direct sales and trading” and “indirect FX trading.”
 
•
Direct sales and trading: Represent FX transactions at negotiated rates with clients and investment managers that contact our trading desk directly. These principal market-making activities include transactions for funds serviced by third party custodians or prime brokers, as well as those funds under custody with us.
•
Indirect FX trading: Represent FX transactions with clients or their investment managers routed to our FX desk through our asset-servicing operation, and to all of which, we are the funds' custodian. We execute indirect FX trades as a principal at rates disclosed to our clients.
Our FX trading revenue is influenced by multiple factors, including: the volume and type of client FX transactions and related spreads; currency volatility, reflecting market conditions; and our management of exchange rate, interest rate and other market risks associated with our FX activities. The relative impact of these factors on our total FX trading revenues often differs from period to period. For example, assuming all other factors remain constant, increases or decreases in volumes or bid-offer spreads across product mix tend to result in increases or decreases, as the case may be, in client-related FX revenue.
Our clients that utilize indirect FX trading can, in addition to executing their FX transactions through dealers not affiliated with us, transition from indirect FX trading to either direct sales and trading execution, including our “Street FX” service, or to one of our electronic trading platforms. Street FX, in which we continue to act as a principal market-maker, enables our clients to define their FX execution strategy and automate the FX trade execution process, both for funds under custody with us as well as those under custody at another bank.
We also earn foreign exchange trading services revenue through "electronic FX services" and "other trading, transition management and brokerage revenue."
•
Electronic FX services: Our clients may choose to execute FX transactions through one of our electronic trading platforms. These transactions generate revenue through a “click” fee.
•
Other trading, transition management and brokerage revenue: As our clients look to us to enhance and preserve portfolio values, they may choose to utilize our Transition or Currency Management capabilities or transact with our Equity Trade execution group. These transactions generate revenue via commissions charged for trades transacted during the management of these portfolios.

State Street Corporation | 20

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Our transition management revenue has been adversely affected by compliance issues in our U.K. business during 2010 and 2011, including settlements with the U.K. Financial Conduct Authority in 2014 and the DOJ and SEC in 2017, including a deferred prosecution agreement. The reputational and regulatory impact of those compliance issues continues and may continue to adversely affect our results in future periods.
Securities Finance
Our securities finance business consists of three components:
(1) an agency lending program for State Street Global Advisors managed investment funds with a broad range of investment objectives, which we refer to as the State Street Global Advisors lending funds;
(2) an agency lending program for third-party investment managers and asset owners, which we refer to as the agency lending funds; and
(3) security lending transactions which we enter into as principal, which we refer to as our enhanced custody business.
Securities finance revenue earned from our agency lending activities, which is composed of our split of both the spreads related to cash collateral and the fees related to non-cash collateral, is principally a function of the volume of securities on loan, the interest rate spreads and fees earned on the underlying collateral and our share of the fee split.
As principal, our enhanced custody business borrows securities from the lending client or other market participants and then lends such securities to the subsequent borrower, either our client or a broker/dealer. We act as principal when the lending client is unable to, or elects not to, transact directly with the market and execute the transaction and furnish the securities. In our role as principal, we provide support to the transaction through our credit rating. While we source a significant proportion of the securities furnished by us in our role as principal from third parties, we have the ability to source securities through assets under custody from clients who have designated us as an eligible borrower.
Securities finance revenue, as presented in Table 8: Investment Servicing Line of Business Results, decreased 17% in the first quarter of 2019 compared to the same period in 2018, primarily due to balance sheet repositioning efforts in the second half of 2018 within our enhanced custody business and lower client activity.
Market influences may continue to affect client demand for securities finance, and as a result our revenue from, and the profitability of, our securities lending activities in future periods. In addition, the constantly evolving regulatory environment, including
 
revised or proposed capital and liquidity standards, interpretations of those standards, and our own balance sheet management activities, may influence modifications to the way in which we deliver our agency lending or enhanced custody businesses, the volume of our securities lending activity and related revenue and profitability in future periods.
Processing Fees and Other
Processing fees and other revenue includes diverse types of fees and revenue, including fees from software licensing and maintenance, fees from our structured products business, equity income from our joint venture investments, gains and losses on sales of other assets and amortization of our tax-advantaged investments.
Processing fees and other revenue, presented in Table 8: Investment Servicing Line of Business Results, increased 134% in the first quarter of 2019 compared to the same period in 2018, and reflects approximately $95 million from CRD in the first quarter of 2019. Revenue related to the front office solutions provided by CRD is primarily driven by the sale of term software licenses and software as a service arrangement inclusive of professional services such as consulting and implementation services, software support and maintenance.
Expenses
Total expenses for Investment Servicing were flat in the first quarter of 2019 compared to the same period in 2018, primarily due to $41 million of expenses from CRD, higher technology costs and higher investments to support new business, offset by benefits of our previously announced expense savings initiative and lower seasonal deferred incentive compensation. In addition, CRD-related expenses in the first quarter of 2019 include $15 million in amortization of other intangible assets. Seasonal deferred incentive compensation expense and payroll taxes was $116 million in the first quarter of 2019 compared to $132 million in the same period in 2018.
Additional information about expenses is provided under "Expenses" in "Consolidated Results of Operations" included in this Management's Discussion and Analysis.

State Street Corporation | 21

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Investment Management
TABLE 12: INVESTMENT MANAGEMENT LINE OF BUSINESS RESULTS
(Dollars in millions)
Three Months Ended March 31,
 
% Change
2019
 
2018
 
Management fees
$
420

 
$
472

 
(11
)%
Foreign exchange trading services(1)
34

 
30

 
13

Securities finance
1

 
—

 
nm

Processing fees and other
11

 
—

 
nm

Total fee revenue
466

 
502

 
(7
)
Net interest income
(6
)
 
(5
)
 
20

Total revenue
460

 
497

 
(7
)
Total expenses
406

 
398

 
2

Income before income tax expense
$
54

 
$
99

 
(45
)
Pre-tax margin
12
%
 
20
%
 
 
 
 
(1) Includes revenues from distributing and marketing activities for U.S. mutual funds and ETFs associated with State Street Global Advisors.
nm Not meaningful
 
Management Fees
Management fees decreased 11% in the first quarter of 2019 compared to the same period in 2018, reflecting product mix and weaker average equity market levels.
Management fees generated outside the U.S. were approximately 27% of total management fees in the first quarter of both 2019 and 2018.

TABLE 13: ASSETS UNDER MANAGEMENT BY ASSET CLASS AND INVESTMENT APPROACH
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
Equity:
  Active
$
85

 
$
80

 
$
94

  Passive
1,696

 
1,464

 
1,576

Total Equity
1,781

 
1,544

 
1,670

Fixed-Income:
  Active
88

 
81

 
79

  Passive
341

 
341

 
354

Total Fixed-Income
429

 
422

 
433

Cash(1)
314

 
287

 
336

Multi-Asset-Class Solutions:
  Active
22

 
19

 
18

  Passive
125

 
113

 
128

Total Multi-Asset-Class Solutions
147

 
132

 
146

Alternative Investments(2):
  Active
21

 
21

 
23

  Passive
113

 
105

 
121

Total Alternative Investments
134

 
126

 
144

Total
$
2,805

 
$
2,511

 
$
2,729

 
 
(1) Includes both floating- and constant-net-asset-value portfolios held in commingled structures or separate accounts.
(2) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF. We are not the investment manager for the SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF, but act as the marketing agent.
TABLE 14: EXCHANGE-TRADED FUNDS BY ASSET CLASS(1)
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
Alternative Investments(2)
$
45

 
$
43

 
$
48

Cash
8

 
9

 
3

Equity
535

 
482

 
513

Fixed-Income
73

 
66

 
65

Total Exchange-Traded Funds
$
661

 
$
600

 
$
629

 
 
(1) ETFs are a component of AUM presented in the preceding table.
(2) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF. We are not the investment manager for the SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF, but act as the marketing agent.

State Street Corporation | 22

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


TABLE 15: GEOGRAPHIC MIX OF ASSETS UNDER MANAGEMENT(1)
(In billions)
March 31, 2019
 
December 31, 2018
 
March 31, 2018
North America
$
1,899

 
$
1,731

 
$
1,885

Europe/Middle East/Africa
447

 
421

 
511

Asia/Pacific
459

 
359

 
333

Total
$
2,805

 
$
2,511

 
$
2,729

 
 
(1) Geographic mix is based on client location or fund management location.
TABLE 16: ACTIVITY IN ASSETS UNDER MANAGEMENT BY PRODUCT CATEGORY
(In billions)
Equity
 
Fixed-Income
 
Cash(1)
 
Multi-Asset-Class Solutions
 
Alternative Investments(2)
 
Total
Balance as of December 31, 2017
$
1,745

 
$
414

 
$
330

 
$
147

 
$
146

 
$
2,782

Long-term institutional flows, net(3)
(45
)

12


—


(3
)

(2
)
 
(38
)
Exchange-Traded Fund flows, net
(3
)
 
7

 
6

 
—

 
(2
)
 
8

Cash fund flows, net
—

 
—

 
(50
)
 
—

 
—

 
(50
)
Total flows, net
(48
)
 
19

 
(44
)
 
(3
)
 
(4
)
 
(80
)
Market appreciation (depreciation)
(142
)
 
(7
)
 
3

 
(10
)
 
(10
)
 
(166
)
Foreign exchange impact
(11
)
 
(4
)
 
(2
)
 
(2
)
 
(6
)
 
(25
)
Total market/foreign exchange impact
(153
)
 
(11
)
 
1

 
(12
)
 
(16
)
 
(191
)
Balance as of December 31, 2018
$
1,544

 
$
422

 
$
287

 
$
132

 
$
126

 
$
2,511

Long-term institutional flows, net(3)
53

 
(9
)
 
1

 
5

 
2

 
52

Exchange-Traded Fund flows, net
(6
)
 
4

 
(1
)
 
—

 
—

 
(3
)
Cash fund flows, net
—

 
—

 
24

 
—

 
—

 
24

Total flows, net
47

 
(5
)
 
24

 
5

 
2

 
73

Market appreciation (depreciation)
191

 
13

 
3

 
10

 
6

 
223

Foreign exchange impact
(1
)
 
(1
)
 
—

 
—

 
—

 
(2
)
Total market/foreign exchange impact
190

 
12

 
3

 
10

 
6

 
221

Balance as of March 31, 2019
$
1,781

 
$
429

 
$
314

 
$
147

 
$
134

 
$
2,805

 
 
(1) Includes both floating- and constant-net-asset-value portfolios held in commingled structures or separate accounts.
(2) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF. We are not the investment manager for the SPDR® Gold Shares ETF and SPDR® Long Dollar Gold Trust ETF, but act as the marketing agent.
(3) Amounts represent long-term portfolios, excluding ETFs.
The preceding table does not include approximately $25 billion of new asset management business which was awarded but not installed as of March 31, 2019. New business will be reflected in AUM in future periods after installation, and will generate management fee revenue in subsequent periods. Total AUM as of March 31, 2019 included managed assets lost but not liquidated. Lost business occurs from time to time and it is difficult to predict the timing of client behavior in transitioning these assets as the timing can vary significantly.

 
Expenses
Total expenses for Investment Management increased 2% in the first quarter of 2019 compared to the same period in 2018, primarily due to annual merit increases and seasonal deferred incentive compensation. Seasonal deferred incentive compensation expense and payroll taxes was $21 million in the first quarter of 2019 compared to $16 million in the same period in 2018.
Additional information about expenses is provided under "Expenses" in "Consolidated Results of Operations" included in this Management's Discussion and Analysis.

State Street Corporation | 23

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


FINANCIAL CONDITION
The structure of our consolidated statement of condition is primarily driven by the liabilities generated by our Investment Servicing and Investment Management lines of business. Our clients' needs and our operating objectives determine balance sheet volume, mix and currency denomination. As our clients execute their worldwide cash management and investment activities, they utilize deposits and short-term investments that constitute the majority of our liabilities. These liabilities are generally in the form of interest-bearing transaction account deposits, which are denominated in a variety of currencies; non-interest-bearing demand deposits; and repurchase agreements, which generally serve as short-term investment alternatives for our clients.
Deposits and other liabilities resulting from client initiated transactions are invested in assets that generally have contractual maturities significantly longer than our liabilities; however, we evaluate the operational nature of our deposits and seek to maintain appropriate short-term liquidity of those liabilities that are not operational in nature and maintain longer-termed assets for our operational deposits. Our assets consist primarily of securities held in our AFS or HTM portfolios and short-duration financial instruments, such as interest-bearing deposits with banks and securities purchased under resale agreements. The actual mix of assets is determined by the characteristics of the client liabilities and our desire to maintain a well-diversified portfolio of high-quality assets.
 
TABLE 17: AVERAGE STATEMENT OF CONDITION(1) 
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Assets:
 
 
 
Interest-bearing deposits with banks
$
48,856

 
$
51,492

Securities purchased under resale agreements
2,775

 
2,872

Trading account assets
866

 
1,138

U.S. Treasury and federal agencies:
 
 
 
Direct obligations
15,427

 
17,183

Mortgage-and asset-backed securities
39,216

 
28,307

State and political subdivisions
1,914

 
8,622

Other investments:
 
 
 
Asset-backed securities
9,078

 
19,543

Collateralized mortgage-backed securities and obligations

980

 
2,088

Other debt investments and equity securities

21,658

 
19,619

Total Investment securities
88,273

 
95,362

Loans and leases
23,056

 
23,959

Other interest-earning assets
15,286

 
17,733

Average total interest-earning assets
179,112

 
192,556

Cash and due from banks
3,078

 
3,081

Other non-interest-earning assets
37,370

 
31,233

Average total assets
$
219,560

 
$
226,870

 
 
 
 
Liabilities and shareholders’ equity:
 
 
Interest-bearing deposits:
 
 
 
U.S.
$
64,531

 
$
48,638

Non-U.S.
59,775

 
78,582

Total interest-bearing deposits(2)
124,306

 
127,220

Securities sold under repurchase agreements
1,773

 
2,617

Other short-term borrowings
1,157

 
1,255

Long-term debt
10,955

 
11,412

Other interest-bearing liabilities
4,642

 
5,260

Average total interest-bearing liabilities
142,833

 
147,764

Non-interest-bearing deposits(2)
31,037

 
37,790

Other non-interest-bearing liabilities
20,921

 
18,942

Preferred shareholders’ equity
3,690

 
3,197

Common shareholders’ equity
21,079

 
19,177

Average total liabilities and shareholders’ equity
$
219,560

 
$
226,870

 
 
(1) Additional information about our average statement of condition, primarily our interest-earning assets and interest-bearing liabilities, is provided in "Net Interest Income" included in this Management's Discussion and Analysis.
(2) Total deposits averaged $155.34 billion in the first quarter of 2019 compared to $165.01 billion in the same period in 2018.

State Street Corporation | 24

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Investment Securities
TABLE 18: CARRYING VALUES OF INVESTMENT SECURITIES
(In millions)
March 31, 2019
 
December 31, 2018
Available-for-sale:
U.S. Treasury and federal agencies:
Direct obligations
$
1,041

 
$
1,039

Mortgage-backed securities
20,043

 
15,968

Total U.S. Treasury and federal agencies
21,084

 
17,007

Asset-backed securities:
 
 
 
Student loans(1) 
481

 
541

Credit cards
586

 
583

Other
886

 
593

Total asset-backed securities
1,953

 
1,717

Non-U.S. debt securities:
 
 
 
Mortgage-backed securities
1,517

 
1,682

Asset-backed securities
1,511

 
1,574

Government securities
12,572

 
12,793

Other
6,576

 
6,602

Total non-U.S. debt securities
22,176

 
22,651

State and political subdivisions
1,940

 
1,918

Collateralized mortgage obligations
129

 
197

Other U.S. debt securities
1,720

 
1,658

Total
$
49,002

 
$
45,148

 
 
 
 
Held-to-maturity(2):
 
 
 
U.S. Treasury and federal agencies:
Direct obligations
$
13,369

 
$
14,794

Mortgage-backed securities
22,568

 
21,647

Total U.S. Treasury and federal agencies
35,937

 
36,441

Asset-backed securities:
 
 
 
Student loans(1) 
3,286

 
3,191

Credit cards
—

 
193

Other
1

 
1

Total asset-backed securities
3,287

 
3,385

Non-U.S. debt securities:
 
 
 
Mortgage-backed securities
575

 
638

Asset-backed securities
98

 
223

Government securities
399

 
358

Other
44

 
46

Total non-U.S. debt securities
1,116

 
1,265

Collateralized mortgage obligations
805

 
823

Total
$
41,145

 
$
41,914

 
 
(1) Primarily comprised of securities guaranteed by the federal government with respect to at least 97% of defaulted principal and accrued interest on the underlying loans.
(2) Includes securities at amortized cost or fair value on the date of transfer from AFS.
Additional information about our investment securities portfolio is provided in Note 3 to the consolidated financial statements in this Form 10-Q.
 
We manage our investment securities portfolio to align with the interest rate and duration characteristics of our client liabilities and in the context of the overall structure of our consolidated statement of condition, in consideration of the global interest rate environment. We consider a well-diversified, high-credit quality investment securities portfolio to be an important element in the management of our consolidated statement of condition.
Average duration of our investment securities portfolio was 2.8 years and 3.1 years as of March 31, 2019 and December 31, 2018, respectively. The decrease in securities duration reflects reinvestment into shorter duration securities and lower long-end U.S. interest rates.
Approximately 91% and 90% of the carrying value of the portfolio was rated “AAA” or “AA” as of March 31, 2019 and December 31, 2018, respectively.
TABLE 19: INVESTMENT PORTFOLIO BY EXTERNAL CREDIT RATING
 
March 31, 2019
 
December 31, 2018
AAA(1)
78
%
 
76
%
AA
13

 
14

A
5

 
5

BBB
4

 
5

Below BBB
—

 
—

 
100
%
 
100
%
 
 
(1) Includes U.S. Treasury and federal agency securities that are split-rated, “AAA” by Moody’s Investors Service and “AA+” by Standard & Poor’s and also includes Agency MBS securities which are not explicitly rated but which have an explicit or assumed guarantee from the U.S. government.
As of March 31, 2019 and December 31, 2018, the investment portfolio was diversified with respect to asset class composition. The following table presents the composition of these asset classes.
TABLE 20: INVESTMENT PORTFOLIO BY ASSET CLASS
 
March 31, 2019
 
December 31, 2018
U.S. Agency
Mortgage-backed securities
44
%
 
40
%
Foreign Sovereign
18

 
19

U.S. Treasuries
16

 
18

Asset-backed securities
10

 
11

Other Credit
12

 
12

 
100
%
 
100
%

State Street Corporation | 25

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Non-U.S. Debt Securities
Approximately 26% of the aggregate carrying value of our investment securities portfolio was non-U.S. debt securities as of March 31, 2019, compared to approximately 27% as of December 31, 2018.
TABLE 21: NON-U.S. DEBT SECURITIES
(In millions)
March 31, 2019
 
December 31, 2018
Available-for-sale:
 
 
 
Australia
$
2,533

 
$
2,847

United Kingdom
2,488

 
2,580

Canada
2,188

 
2,185

France
1,837

 
1,875

Germany
1,606

 
1,547

Spain
1,481

 
1,504

Japan
1,342

 
1,352

Austria
1,323

 
1,312

Ireland
1,285

 
1,301

European(1)
1,151

 
1,087

Netherlands
1,108

 
1,116

Italy
952

 
1,010

Belgium
944

 
952

Finland
777

 
789

Asian(1)
338

 
338

Hong Kong
309

 
458

Sweden
189

 
186

Brazil
90

 
—

Norway
50

 
94

Other(2)
185

 
118

Total
$
22,176

 
$
22,651

Held-to-maturity:
 
 
 
Singapore
$
285

 
$
242

United Kingdom
234

 
363

Australia
153

 
158

Netherlands
140

 
187

Germany
113

 
115

Spain
89

 
92

Other(3)
102

 
108

Total
$
1,116

 
$
1,265

 
 
(1) Consists entirely of supranational bonds.
(2) Included approximately $145 million and $78 million as of March 31, 2019 and December 31, 2018, respectively, related to supranational bonds.
(3) Included approximately $58 million and $61 million as of March 31, 2019 and December 31, 2018, respectively, related to Italy and Portugal, all of which were related to MBS.
Approximately 73% and 74% of the aggregate carrying value of these non-U.S. debt securities was rated “AAA” or “AA” as of March 31, 2019 and December 31, 2018, respectively. The majority of these securities comprised senior positions within the security structures; these positions have a level of protection provided through subordination and other forms of credit protection. As of March 31, 2019 and December 31, 2018, approximately 28% and 31%, respectively, of the aggregate carrying value of these non-U.S. debt securities was floating-rate.
As of March 31, 2019, our non-U.S. debt securities had an average market-to-book ratio of 100.9%, and an aggregate pre-tax net unrealized gain of $205 million, composed of gross unrealized gains of $240 million and
 
gross unrealized losses of $35 million. These unrealized amounts included:
•
a pre-tax net unrealized loss of $130 million, composed of gross unrealized gains of $157 million and gross unrealized losses of $27 million, associated with non-U.S. AFS debt securities; and
•
a pre-tax net unrealized gain of $75 million, composed of gross unrealized gains of $83 million and gross unrealized losses of $8 million, associated with non-U.S. HTM debt securities.
As of March 31, 2019, the underlying collateral for non-U.S. MBS and ABS primarily included U.K., Australian, Italian and Dutch mortgages as well as U.K., German and Spanish consumer ABS. The securities listed under “Canada” were composed of Canadian government securities and corporate debt and covered bonds. The securities listed under “France” were composed of sovereign bonds and corporate debt and covered bonds. The securities listed under “Japan” were substantially composed of Japanese government securities.
Municipal Obligations
We carried approximately $1.94 billion of municipal securities classified as state and political subdivisions in our investment securities portfolio as of March 31, 2019 as shown in Table 18: Carrying Values of Investment Securities, all of which were classified as AFS. As of March 31, 2019, we also provided approximately $9.25 billion of credit and liquidity facilities to municipal issuers.
TABLE 22: STATE AND MUNICIPAL OBLIGORS(1)
(Dollars in millions)
Total Municipal
Securities
 
Credit and
Liquidity 
Facilities(2)
 
Total
 
% of Total Municipal
Exposure
March 31, 2019
 
 
 
 
 
 
State of Issuer:
 
 
 
 
 
 
Texas
$
299

 
$
2,467

 
$
2,766

 
25
%
California
115

 
1,693

 
1,808

 
16

New York
283

 
1,518

 
1,801

 
16

Massachusetts
465

 
778

 
1,243

 
11

Tennessee
7

 
502

 
509

 
5

Total
$
1,169

 
$
6,958

 
$
8,127

 
 
 
 
 
 
 
 
 
 
December 31, 2018
 
 
 
 
 
 
State of Issuer:
 
 
 
 
 
 
Texas
$
315

 
$
2,467

 
$
2,782

 
25
%
California
108

 
1,693

 
1,801

 
16

New York
231

 
1,518

 
1,749

 
15

Massachusetts
467

 
978

 
1,445

 
13

Total
$
1,121

 
$
6,656

 
$
7,777

 
 
 
 
 
 
(1) Represented 5% or more of our aggregate municipal credit exposure of approximately $11.19 billion and $11.35 billion across our businesses as of March 31, 2019 and December 31, 2018, respectively.
(2) Includes municipal loans which are also presented within Table 23: U.S. and Non-U.S. Loans and Leases.


State Street Corporation | 26

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Our aggregate municipal securities exposure presented in Table 22: State and Municipal Obligors, was concentrated primarily with highly-rated counterparties, with approximately 81% of the obligors rated “AAA” or “AA” as of March 31, 2019. As of that date, approximately 22% and 78% of our aggregate municipal securities exposure was associated with general obligation and revenue bonds, respectively. The portfolios are also diversified geographically, with the states that represent our largest exposures widely dispersed across the U.S.
Additional information with respect to our assessment of OTTI of our municipal securities is provided in Note 3 to the consolidated financial statements in this Form 10-Q.
Impairment
Impairment exists when the fair value of an individual security is below its amortized cost basis. Impairment of a security is further assessed to determine whether such impairment is other-than-temporary. For AFS and HTM debt securities, we record impairment in our consolidated statement of income when management intends to sell (or may be required to sell) the securities before they recover in value, or when management expects the present value of cash flows expected to be collected from the securities to be less than the amortized cost of the impaired security (a credit loss).
We conduct periodic reviews of individual securities to assess whether OTTI exists. Our assessment of OTTI involves an evaluation of economic and security-specific factors. Such factors are based on estimates, derived by management, which contemplate current market conditions and security-specific performance. To the extent that market conditions are worse than management's expectations or due to idiosyncratic bond performance, OTTI could increase, in particular the credit-related component that would be recorded in our consolidated statement of income. Additional information with respect to OTTI, net impairment losses and gross unrealized losses is provided in Note 3 to the consolidated financial statements in this Form 10-Q.
Our evaluation of potential OTTI of structured credit securities with collateral in the U.K. and continental Europe takes into account the outcome from the Brexit referendum and other geopolitical events, and assumes no disruption of payments on these securities.
 
Loans and Leases
TABLE 23: U.S. AND NON- U.S. LOANS AND LEASES
(In millions)
March 31, 2019
 
December 31, 2018
Domestic:
 
 
 
Commercial and financial
$
16,451

 
$
19,479

Commercial real estate
976

 
874

Total domestic
17,427

 
20,353

Non-U.S.:
 
 
 
Commercial and financial
5,954

 
5,436

Total loans and leases
$
23,381

 
$
25,789

The decrease in loans in the domestic commercial and financial segment as of March 31, 2019 compared to December 31, 2018 was primarily driven by lower levels of client overdrafts.
As of March 31, 2019 and December 31, 2018, our investment in senior secured loans totaled approximately $4.5 billion and $4.4 billion, respectively. In addition, we had binding unfunded commitments as of March 31, 2019 and December 31, 2018 of $114 million and $238 million, respectively, to participate in such syndications. The decrease in unfunded commitments is due to lower activity in the leveraged loans market in the first quarter of 2019 compared to the fourth quarter of 2018. Unfunded commitments as of December 31, 2018 settled in the first quarter of 2019 and are now funded commitments. Additional information about these unfunded commitments is provided in Note 9 to the consolidated financial statements in this Form 10-Q.
These senior secured loans, which are primarily rated “speculative” under our internal risk-rating framework (refer to Note 4 to the consolidated financial statements in this Form 10-Q), are externally rated “BBB,” “BB” or “B,” with approximately 88% and 90% of the loans rated “BB” or “B” as of March 31, 2019 and December 31, 2018, respectively. Our investment strategy involves generally limiting our investment to larger, more liquid credits underwritten by major global financial institutions, applying our internal credit analysis process to each potential investment and diversifying our exposure by counterparty and industry segment. However, these loans have significant exposure to credit losses relative to higher-rated loans in our portfolio.
Loans to municipalities included in the commercial and financial segment were $0.97 billion and $0.90 billion as of March 31, 2019 and December 31, 2018, respectively.
Additional information about all of our loan and leases segments, as well as underlying classes, is provided in Note 4 to the consolidated financial statements in this Form 10-Q.
No loans were modified in troubled debt restructurings as of both March 31, 2019 and December 31, 2018.

State Street Corporation | 27

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


TABLE 24: ALLOWANCE FOR LOAN AND LEASE LOSSES
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Allowance for loan and lease losses:
Beginning balance
$
67

 
$
54

Provision for loan and lease losses(1)
4

 
—

Other(2)
(1
)
 
—

Ending balance
$
70


$
54

 
 
(1) The provision for loan and lease losses is primarily related to commercial and financial loans.
(2) Consists primarily of FX translation.
We recorded a provision for loan losses of $4 million in the first quarter of 2019 compared to less than $1 million provision for loan losses recorded in the same period in 2018. The increase was primarily due to a higher volume of loans to non-investment grade borrowers composed of senior secured loans that we purchased in connection with our participation in loan syndications in the non-investment grade lending market.
In the first quarter of 2019, approximately $62 million of our ALLL was related to senior secured loans included in the commercial and financial segment compared to $46 million in the same period in 2018. As this portfolio grows and matures, our ALLL related to these loans may increase through additional provisions for credit losses. The remaining $8 million in both the first quarter of 2019 and 2018 was related to other components of commercial and financial loans.
Cross-Border Outstandings
Cross-border outstandings are amounts payable to us by non-U.S. counterparties which are denominated in U.S. dollars or other non-local currency, as well as non-U.S. local currency claims not funded by local currency liabilities. Our cross-border outstandings consist primarily of deposits with banks; loans and lease financing, including short-duration advances; investment securities; amounts related to FX and interest rate contracts; and securities finance.  In addition to credit risk, cross-border outstandings have the risk that, as a result of political or economic conditions in a country, borrowers may be unable to meet their contractual repayment obligations of principal and/or interest when due because of the unavailability of, or restrictions on, FX needed by borrowers to repay their obligations.
As market and economic conditions change, the major independent credit rating agencies may downgrade U.S. and non-U.S. financial institutions and sovereign issuers which have been, and may in the future be, significant counterparties to us, or whose financial instruments serve as collateral on which we rely for credit risk mitigation purposes, and may do so again in the future. As a result, we may be exposed to
 
increased counterparty risk, leading to negative ratings volatility.
The cross-border outstandings presented in Table 25: Cross-Border Outstandings, represented approximately 28% of our consolidated total assets as of both March 31, 2019 and December 31, 2018.
TABLE 25: CROSS-BORDER OUTSTANDINGS(1)
(In millions)
Investment Securities and Other Assets 
 
Derivatives and Securities on Loan
 
Total Cross-Border Outstandings
March 31, 2019
 

 
 
 
 
Germany
$
18,962

 
$
441

 
$
19,403

Japan
12,444

 
1,384

 
13,828

United Kingdom
11,750

 
1,057

 
12,807

Australia
4,072

 
512

 
4,584

Luxembourg
2,420

 
1,299

 
3,719

Canada
2,612

 
606

 
3,218

Ireland
1,878

 
1,193

 
3,071

France
2,479

 
352

 
2,831

December 31, 2018
 
 
 
 
 

Germany
$
20,157

 
$
489

 
$
20,646

Japan
13,985

 
1,084

 
15,069

United Kingdom
12,623

 
1,176

 
13,799

Australia
4,217

 
1,349

 
5,566

Canada
3,010

 
1,507

 
4,517

Ireland
2,019

 
809

 
2,828

France
2,495

 
294

 
2,789

Luxembourg
2,033

 
710

 
2,743

 
 
(1) Cross-border outstandings included countries in which we do business, and which amounted to at least 1% of our consolidated total assets as of the dates indicated.
As of March 31, 2019, aggregate cross-border outstandings in Switzerland amounted to between 0.75% and 1% of our consolidated assets, at approximately $1.85 billion. As of December 31, 2018, there were no countries whose aggregate cross-border outstandings amounted to between 0.75% and 1% of our consolidated assets.

State Street Corporation | 28

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Risk Management
In the normal course of our global business activities, we are exposed to a variety of risks, some inherent in the financial services industry, others more specific to our business activities. Our risk management framework focuses on material risks, which include the following:
•
credit and counterparty risk;
•
liquidity risk, funding and management;
•
operational risk;
•
information technology risk;
•
market risk associated with our trading activities;
•
market risk associated with our non-trading activities, which we refer to as asset-and-liability management, and which consists primarily of interest-rate risk;
•
model risk;
•
strategic risk; and
•
reputational, fiduciary and business conduct risk.
Many of these risks, as well as certain of the factors underlying each of these risks that could affect our businesses and our consolidated financial statements, are discussed in detail on pages 17 to 46 included under Item 1A, Risk Factors, in our 2018 Form 10-K.
For additional information about our risk management, including our risk appetite framework and risk governance committee structure, refer to pages 79 to 83 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework" in our 2018 Form 10-K.
Credit Risk Management
We define credit risk as the risk of financial loss if a counterparty, borrower or obligor, collectively referred to as a counterparty, is either unable or unwilling to repay borrowings or settle a transaction in accordance with underlying contractual terms. We assume credit risk in our traditional non-trading lending activities, such as loans and contingent commitments, in our investment securities portfolio, where recourse to a counterparty exists, and in our direct and indirect trading activities, such as principal securities lending and FX and indemnified agency securities lending. We also assume credit risk in our day-to-day treasury and securities and other settlement operations, in the form of deposit placements and other cash balances, with central banks or private sector institutions.
For additional information about our credit risk management framework, including our core policies and principles, structure and organization, credit ratings, risk parameter estimates, credit risk mitigation, credit limits, reporting, monitoring, controls and reserve
 
for credit losses, refer to pages 83 to 88 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework", in our 2018 Form 10-K.
Liquidity Risk Management
Our liquidity framework contemplates areas of potential risk based on our activities, size and other appropriate risk-related factors. In managing liquidity risk we employ limits, maintain established metrics and early warning indicators and perform routine stress testing to identify potential liquidity needs. This process involves the evaluation of a combination of internal and external scenarios which assist us in measuring our liquidity position and in identifying potential increases in cash needs or decreases in available sources of cash, as well as the potential impairment of our ability to access the global capital markets.
We manage our liquidity on a global, consolidated basis. We also manage liquidity on a stand-alone basis at the Parent Company, as well as at certain branches and subsidiaries of State Street Bank. State Street Bank generally has access to markets and funding sources limited to banks, such as the federal funds market and the Federal Reserve's discount window. The Parent Company is managed to a more conservative liquidity profile, reflecting narrower market access. Additionally, the Parent Company typically holds, or has direct access to, primarily through State Street Intermediate Funding, LLC (SSIF), a direct subsidiary of the Parent Company, and the support agreement, as discussed in the "Uses of Liquidity" section of this Management's Discussion and Analysis, enough cash to meet its current debt maturities and cash needs, as well as those projected over the next one-year period. Reference our SPOE Strategy as discussed in the "Uses of Liquidity" section of this Management's Discussion and Analysis. Absent financial distress at the Parent Company, the liquid assets available at SSIF continue to be available to the Parent Company. As of March 31, 2019, the Parent Company and State Street Bank had no senior notes or subordinated debentures outstanding that will mature in the next twelve months.
As a systemically important financial institution, our liquidity risk management activities are subject to heightened and evolving regulatory requirements, including interpretations of those requirements, under specific U.S. and international regulations and also resulting from published and unpublished guidance, supervisory activities, such as stress tests, resolution planning, examinations and other regulatory interactions. Satisfaction of these requirements could, in some cases, result in changes in the composition of our investment portfolio, reduced NII or NIM, a reduction in the level of certain business activities or modifications to the way in which we deliver our products and services. If we fail to meet regulatory requirements to the

State Street Corporation | 29

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


satisfaction of our regulators, we could receive negative regulatory stress test results, incur a resolution plan deficiency or determination of a non-credible resolution plan or otherwise receive an adverse regulatory finding. Our efforts to satisfy, or our failure to satisfy, these regulatory requirements could materially adversely affect our business, financial condition or results of operations.
For additional information on our liquidity risk management, as well as liquidity risk metrics, refer to pages 88 to 92 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operation, in our 2018 Form 10-K. For additional information on our liquidity ratios, including LCR and the net stable funding ratio, refer to pages 7 to 8 included under Item 1, Business, in our 2018 Form 10-K.
Asset Liquidity
Central to the management of our liquidity is asset liquidity, which consists primarily of unencumbered highly liquid securities, cash and cash equivalents reported on our consolidated statement of condition. We restrict the eligibility of securities to be characterized as asset liquidity to U.S. Government and federal agency securities (including MBS), securities of selected non-U.S. Governments and supranational organizations as well as certain other high-quality securities which generally are more liquid than other types of assets even in times of stress. As a banking organization, we are subject to a minimum LCR under the LCR rule approved by U.S. banking regulators. The LCR is intended to promote the short-term resilience of internationally active banking organizations, like us, to improve the banking industry's ability to absorb shocks arising from market stress over a 30 calendar day period and improve the measurement and management of liquidity risk. The LCR measures an institution’s HQLA against its net cash outflows. HQLA primarily consists of unencumbered cash and certain high quality liquid securities that qualify for inclusion under the LCR rule. The LCR was fully implemented beginning on January 1, 2017. We report LCR to the Federal Reserve daily. For the quarters ended March 31, 2019 and December 31, 2018, daily average LCR for the Parent Company was 110% and 108%, respectively. The average HQLA for the Parent Company under the LCR final rule was $93.50 billion and $91.67 billion, post-prescribed haircuts, for the quarters ended March 31, 2019 and December 31, 2018, respectively.
We maintained average cash balances in excess of regulatory requirements governing deposits with the Federal Reserve of approximately $39.26 billion at the Federal Reserve, the ECB and other non-U.S. central banks for the quarter ended March 31, 2019, compared to $44.17 billion for the quarter ended December 31,
 
2018. The lower levels of average cash balances with central banks reflect levels of client deposits.
Liquid securities carried in our asset liquidity include securities pledged without corresponding advances from the Federal Reserve Bank of Boston (FRBB), the FHLB and other non-U.S. central banks. State Street Bank is a member of the FHLB. This membership allows for advances of liquidity in varying terms against high-quality collateral, which helps facilitate asset-and-liability management. As of March 31, 2019, we had no outstanding borrowings from the FHLB. As of December 31, 2018, we had approximately $2 billion of outstanding borrowings from the FHLB.
Access to primary, intra-day and contingent liquidity provided by these utilities is an important source of contingent liquidity with utilization subject to underlying conditions. As of March 31, 2019 and December 31, 2018, we had no outstanding primary credit borrowings from the FRBB discount window or any other central bank facility.
In addition to the securities included in our asset liquidity, we have significant amounts of other unencumbered investment securities. These securities are available sources of liquidity, although not as rapidly deployed as those included in our asset liquidity.
The average fair value of total unencumbered securities was $70.17 billion for the quarter ended March 31, 2019 compared to $65.94 billion for the quarter ended December 31, 2018.
Uses of Liquidity
Significant uses of our liquidity could result from the following: withdrawals of client deposits; draw-downs by our custody clients of lines of credit; advances to clients to settle securities transactions; or other permitted purposes. Such circumstances would generally arise under stress conditions including deterioration in credit ratings. A recurring significant use of our liquidity involves our deployment of HQLA from our investment portfolio to post collateral to financial institutions serving as sources of securities under our enhanced custody program.
We had unfunded commitments to extend credit with gross contractual amounts totaling $29.95 billion and $28.95 billion and standby letters of credit totaling $2.97 billion and $2.99 billion as of March 31, 2019 and December 31, 2018, respectively. These amounts do not reflect the value of any collateral. As of March 31, 2019, approximately 75% of our unfunded commitments to extend credit and 29% of our standby letters of credit expire within one year. Since many of our commitments are expected to expire or renew without being drawn upon, the gross contractual amounts do not necessarily represent our future cash requirements.

State Street Corporation | 30

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Resolution Planning
State Street, like other bank holding companies with total consolidated assets of $50 billion or more, periodically submits a plan for rapid and orderly resolution in the event of material financial distress or failure, commonly referred to as a resolution plan or a living will, to the Federal Reserve and the FDIC under Section 165(d) of the Dodd-Frank Act. Through resolution planning, we seek, in the event of our insolvency, to maintain State Street Bank’s role as a key infrastructure provider within the financial system, while minimizing risk to the financial system and maximizing value for the benefit of our stakeholders. We have and will continue to focus management attention and resources to meet regulatory expectations with respect to resolution planning.
We submitted our 2017 resolution plan describing our preferred resolution strategy to the Federal Reserve and FDIC on June 30, 2017. Subsequently, the Federal Reserve and FDIC extended the next resolution plan filing deadline for eight large domestic banks, including us, to July 1, 2019. The agencies completed their review of our 2017 165(d) resolution plan in December 2017 and found no deficiencies or shortcomings in the plan.
In the event of material financial distress or failure, our preferred resolution strategy is the SPOE Strategy. For additional information about the SPOE Strategy, refer to pages 11 and 12 included under Item 1, Business, in our 2018 Form 10-K. The SPOE Strategy provides that prior to the bankruptcy of the Parent Company and pursuant to a support agreement among the Parent Company, SSIF, our Beneficiary Entities (as defined below) and certain other of our entities, SSIF is obligated, up to its available resources, to recapitalize and/or provide liquidity to State Street Bank and our other entities benefiting from such capital and/or liquidity (collectively with State Street Bank, “Beneficiary Entities”), in amounts designed to prevent the Beneficiary Entities from themselves entering into resolution proceedings. Following the recapitalization of, or provision of liquidity to the Beneficiary Entities, the Parent Company would enter into a bankruptcy proceeding under the U.S. Bankruptcy Code. The Beneficiary Entities and our subsidiaries would be transferred to a newly organized holding company held by a reorganization trust for the benefit of the Parent Company’s claimants.
Under the support agreement, the Parent Company has pre-funded SSIF by contributing certain of its assets (primarily its liquid assets, cash deposits, debt investments, investments in marketable securities and other cash and non-cash equivalent investments) to SSIF contemporaneous with entering into the support agreement and will continue to contribute such assets, to the extent available, on an on-going basis. In consideration for these contributions, SSIF has agreed
 
in the support agreement to provide capital and liquidity support to the Parent Company and all of the Beneficiary Entities in accordance with the Parent Company’s capital and liquidity policies. Under the support agreement, the Parent Company is only permitted to retain certain amounts of cash needed to meet its upcoming obligations and to fund expenses during a potential bankruptcy proceeding. SSIF has provided the Parent Company with a committed credit line and issued (and may issue) one or more promissory notes to the Parent Company (the "Parent Company Funding Notes") that together are intended to allow us to continue to meet our obligations throughout the period prior to the occurrence of a "Recapitalization Event" (as defined below). The support agreement does not contemplate that SSIF is obligated to maintain any specific level of resources and SSIF may not have sufficient resources to implement the SPOE Strategy.
In the event a Recapitalization Event occurs, the obligations outstanding under the Parent Company Funding Notes would automatically convert into or be exchanged for capital contributed to SSIF. The obligations of the Parent Company and SSIF under the support agreement are secured through a security agreement that grants a lien on the assets that the Parent Company and SSIF would use to fulfill their obligations under the support agreement to the Beneficiary Entities. SSIF is a distinct legal entity separate from the Parent Company and the Parent Company’s other affiliates.
In accordance with its policies, we are required to monitor, on an ongoing basis, the capital and liquidity needs of State Street Bank and the other Beneficiary Entities. To support this process, we have established a trigger framework that identifies key actions that would need to be taken or decisions that would need to be made if certain events tied to our financial condition occur. In the event that we experience material financial distress, the support agreement requires us to model and calculate certain capital and liquidity triggers on a regular basis to determine whether or not the Parent Company should commence preparations for a bankruptcy filing and whether or not a Recapitalization Event has occurred.
Upon the occurrence of a Recapitalization Event: (1) SSIF would not be authorized to provide any further liquidity to the Parent Company; (2) the Parent Company would be required to contribute to SSIF any remaining assets it is required to contribute to SSIF under the support agreement; (3) SSIF would be required to provide capital and liquidity support to the Beneficiary Entities to support such entities’ continued operation; and (4) the Parent Company would be expected to commence Chapter 11 proceedings under the U.S. Bankruptcy Code. No person or entity, other than a party to the support agreement, should rely, including in evaluating any of our entities from a

State Street Corporation | 31

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


creditor's perspective or determining whether to enter into a contractual relationship with any of our entities, on any of our affiliates being or remaining a Beneficiary Entity or receiving capital or liquidity support pursuant to the support agreement.
A “Recapitalization Event” is defined under the support agreement as the earlier occurrence of one or more capital and liquidity thresholds being breached or the authorization by the Parent Company's Board of Directors for the Parent Company to commence bankruptcy proceedings. These thresholds are set at levels intended to provide for the availability of sufficient capital and liquidity to enable an orderly resolution without extraordinary government support. The SPOE Strategy and the obligations under the support agreement may result in the recapitalization of State Street Bank and the commencement of bankruptcy proceedings by the Parent Company at an earlier stage of financial stress than might otherwise occur without such mechanisms in place. An expected effect of the SPOE Strategy and applicable TLAC regulatory requirements is that losses will be imposed on the Parent Company shareholders and the holders of long-term debt and other forms of TLAC securities currently outstanding or issued in the future by the Parent Company, as well as on any other Parent Company creditors, before any of its losses are imposed on the holders of the debt securities of the Parent Company's operating subsidiaries or any of their depositors or creditors, or before U.S. taxpayers are put at risk.
There can be no assurance that credit rating agencies, in response to our 2017 resolution plan or the support agreement, will not downgrade, place on negative watch or change their outlook on our debt credit ratings, generally or on specific debt securities. Any such downgrade, placement on negative watch or change in outlook could adversely affect our cost of borrowing, limit our access to the capital markets or result in restrictive covenants in future debt agreements and could also adversely impact the trading prices, or the liquidity, of our outstanding debt securities.
State Street Bank is also required to submit annually to the FDIC a plan for resolution in the event of its failure, referred to as an Insured Depository Institution (IDI) plan. We filed our most recent IDI plan on June 28, 2018.
Funding
Deposits
We provide products and services including custody, accounting, administration, daily pricing, FX services, cash management, financial asset management, securities finance and investment advisory services. As a provider of these products and services, we generate client deposits, which have generally provided a stable, low-cost source of funds. As a global custodian, clients place deposits with our
 
entities in various currencies. As of both March 31, 2019 and December 31, 2018, approximately 60% of our average total deposit balances were denominated in U.S. dollars, approximately 20% in EUR, 10% in GBP and 10% in all other currencies.
Short-Term Funding
Our on-balance sheet liquid assets are also an integral component of our liquidity management strategy. These assets provide liquidity through maturities of the assets, but more importantly, they provide us with the ability to raise funds by pledging the securities as collateral for borrowings or through outright sales. In addition, our access to the global capital markets gives us the ability to source incremental funding from wholesale investors. As discussed earlier under “Asset Liquidity,” State Street Bank's membership in the FHLB allows for advances of liquidity with varying terms against high-quality collateral.
Short-term secured funding also comes in the form of securities lent or sold under agreements to repurchase. These transactions are short-term in nature, generally overnight and are collateralized by high-quality investment securities. These balances were $1.42 billion and $1.08 billion as of March 31, 2019 and December 31, 2018, respectively.
State Street Bank currently maintains a line of credit with a financial institution of CAD 1.40 billion, or approximately $1.05 billion, as of March 31, 2019, to support its Canadian securities processing operations. The line of credit has no stated termination date and is cancelable by either party with prior notice. As of both March 31, 2019 and December 31, 2018, there was no balance outstanding on this line of credit.
Long-Term Funding
We have the ability to issue debt and equity securities under our current universal shelf registration statement to meet current commitments and business needs, including accommodating the transaction and cash management needs of our clients. In addition, State Street Bank also has current authorization from the Board to issue up to $5 billion in unsecured senior debt and an additional $500 million of subordinated debt.

State Street Corporation | 32

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Agency Credit Ratings
Our ability to maintain consistent access to liquidity is fostered by the maintenance of high investment grade ratings as measured by the major independent credit rating agencies. Factors essential to maintaining high credit ratings include:
•
diverse and stable core earnings;
•
relative market position;
•
strong risk management;
•
strong capital ratios;
•
diverse liquidity sources, including the global capital markets and client deposits;
•
strong liquidity monitoring procedures; and
•
preparedness for current or future regulatory developments.
High ratings limit borrowing costs and enhance our liquidity by:
•
providing assurance for unsecured funding and depositors;
•
increasing the potential market for our debt and improving our ability to offer products;
•
serving markets; and
•
engaging in transactions in which clients value high credit ratings.
A downgrade or reduction of our credit ratings could have a material adverse effect on our liquidity by restricting our ability to access the capital markets, which could increase the related cost of funds. In turn, this could cause the sudden and large-scale withdrawal of unsecured deposits by our clients, which could lead to draw-downs of unfunded commitments to extend credit or trigger requirements under securities purchase commitments; or require additional collateral or force terminations of certain trading derivative contracts.
A majority of our derivative contracts have been entered into under bilateral agreements with counterparties who may require us to post collateral or terminate the transactions based on changes in our credit ratings. We assess the impact of these arrangements by determining the collateral that would be required assuming a downgrade by all rating agencies. The additional collateral or termination payments related to our net derivative liabilities under these arrangements that could have been called by counterparties in the event of a downgrade in our credit ratings below levels specified in the agreements is provided in Note 7 to the consolidated financial statements in this Form 10-Q. Other funding sources, such as secured financing transactions and other margin requirements, for which there are no explicit triggers, could also be adversely affected.

 
Operational Risk Management
Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. Operational risk encompasses fiduciary risk and legal risk. Fiduciary risk is defined as the risk that we fail to properly exercise our fiduciary duties in our provision of products or services to clients. Legal risk is the risk of loss resulting from failure to comply with laws and contractual obligations as well as prudent ethical standards in business practices in addition to exposure to litigation from all aspects of our activities.
For additional information about our operational risk framework, refer to pages 93 to 96 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework", in our 2018 Form 10-K.
Information Technology Risk Management
We define information technology risk as the risk associated with the use, ownership, operation, involvement, influence and adoption of information technology. Information technology risk includes risks potentially triggered by technology non-compliance with regulatory obligations, information security and privacy incidents, business disruption, technology internal control and process gaps, technology operational events and adoption of new business technologies.
For additional information about our information technology risk framework, refer to pages 96 to 97 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management" in our 2018 Form 10-K.
Market Risk Management
Market risk is defined by U.S. banking regulators as the risk of loss that could result from broad market movements, such as changes in the general level of interest rates, credit spreads, FX rates or commodity prices. We are exposed to market risk in both our trading and certain of our non-trading, or asset-and-liability management, activities.
Information about the market risk associated with our trading activities is provided below under “Trading Activities.” Information about the market risk associated with our non-trading activities, which consists primarily of interest-rate risk, is provided below under “Asset-and-Liability Management Activities.”
Trading Activities
In the conduct of our trading activities, we assume market risk, the level of which is a function of our overall risk appetite, business objectives and liquidity needs, our clients' requirements and market volatility, and our execution against those factors.

State Street Corporation | 33

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


For additional information about the market risk associated with our trading activities, refer to pages 97 to 98 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our 2018 Form 10-K.
As part of our trading activities, we assume positions in the FX and interest-rate markets by buying and selling cash instruments and entering into derivative instruments, including FX forward contracts, FX and interest-rate options and interest-rate swaps, interest-rate forward contracts, and interest-rate futures. As of March 31, 2019, the notional amount of these derivative contracts was $2.30 trillion, of which $2.29 trillion was composed of FX forward, swap and spot contracts. We seek to match positions closely with the objective of minimizing related currency and interest-rate risk. All FX contracts are valued daily at current market rates.
Value-at-Risk and Stressed Value-at-Risk
We use a variety of risk measurement tools and methodologies, including VaR, which is an estimate of potential loss for a given period within a stated statistical confidence interval. We use a risk measurement methodology to measure trading-related VaR daily. We have adopted standards for measuring trading related VaR, and we maintain regulatory capital for market risk associated with currently applicable bank regulatory market risk requirements. Our regulatory VaR-based measure is calculated based on historical volatilities of market risk factors during a two-year observation period calibrated to a one-tail, 99% confidence interval and a ten-business-day holding period.
We calculate a stressed VaR-based measure using the same model we use to calculate VaR, but with model inputs calibrated to historical data from a range of continuous twelve-month periods that reflect significant financial stress. The stressed VaR model identifies the second-worst outcome occurring in the worst continuous one-year rolling period since July 2007. This stressed VaR meets the regulatory requirement as the rolling ten-day period with an outcome that is worse than 99% of other outcomes during that twelve-month period of financial stress. For each portfolio, the stress period is determined algorithmically by seeking the one-year time horizon that produces the largest ten-business-day VaR from within the available historical data. This historical data set includes the financial crisis of 2008, the highly volatile period surrounding the Eurozone sovereign debt crisis and the Standard & Poor's downgrade of U.S. Treasury debt in August 2011. As the historical data set used to determine the stress period expands over time, future market stress events will be automatically incorporated.
For additional information about our VaR measurement tools and methodologies, refer to pages
 
99 to 103 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our 2018 Form 10-K.
Stress Testing
We have a corporate-wide stress testing program in place that incorporates an array of techniques to measure the potential loss we could suffer in a hypothetical scenario of adverse economic and financial conditions. We also monitor concentrations of risk such as concentration by branch, risk component, and currency pairs. We conduct stress testing on a daily basis based on selected historical stress events that are relevant to our positions in order to estimate the potential impact to our current portfolio should similar market conditions recur, and we also perform stress testing as part of the Federal Reserve's Comprehensive Capital Analysis and Review (CCAR) process. Stress testing is conducted, analyzed and reported at the corporate, trading desk, division and risk-factor level (for example, exchange risk, interest-rate risk and volatility risk).
Stress testing results and limits are actively monitored on a daily basis by Enterprise Risk Management (ERM) and reported to the Trading and Markets Risk Committee (TMRC). Limit breaches are addressed by ERM risk managers in conjunction with the business units, escalated as appropriate, and reviewed by the TMRC if material. In addition, we have established several action triggers that prompt immediate review by management and the implementation of a remediation plan.
Validation and Back-Testing
We perform frequent back-testing to assess the accuracy of our VaR-based model in estimating loss at the stated confidence level. This back-testing involves the comparison of estimated VaR model outputs to daily, actual profit-and-loss (P&L) outcomes, observed from daily market movements. We back-test our VaR model using “clean” P&L, which excludes non-trading revenue such as fees, commissions and NII, as well as estimated revenue from intra-day trading.
Our VaR definition of trading losses excludes items that are not specific to the price movement of the trading assets and liabilities themselves, such as fees, commissions, changes to reserves and gains or losses from intra-day activity.
We had no back-testing exceptions in the quarters ended March 31, 2019, December 31, 2018 and March 31, 2018.
The following tables present VaR and stressed VaR associated with our trading activities for covered positions held during the quarters ended March 31, 2019, December 31, 2018 and March 31, 2018. As of March 31, 2019, December 31, 2018 and March 31, 2018, as measured by our VaR methodology, a covered

State Street Corporation | 34

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


position is generally defined by U.S. banking regulators as an on-or off-balance sheet position associated with the organization's trading activities that is free of any restrictions on its tradability, but does not include intangible assets, certain credit derivatives recognized as guarantees and certain equity positions not publicly traded.
 
Diversification effect in the table below represents the difference between total VaR and the sum of the VaRs for each trading activity. This effect arises because the trading activities are not perfectly correlated.
TABLE 26: TEN-DAY VALUE-AT-RISK ASSOCIATED WITH TRADING ACTIVITIES FOR COVERED POSITIONS
 
 
 
Three Months Ended
 
As of March 31, 2019
 
As of December 31, 2018
 
As of March 31, 2018
 
March 31, 2019
 
December 31, 2018
 
March 31, 2018
 
 
 
(In thousands)
Avg.
 
Max.
 
Min.
 
Avg.
 
Max.
 
Min.
 
Avg.
 
Max.
 
Min.
 
VaR
 
VaR
 
VaR
Global Markets
$
10,030


$
18,397


$
4,201

 
$
10,459

 
$
19,160

 
$
3,721

 
$
6,496


$
11,390


$
2,967

 
$
16,571

 
$
10,588

 
$
4,233

Global Treasury
614


2,615


207

 
1,281

 
3,579

 
392

 
764


1,940


100

 
865

 
1,354

 
1,187

Diversification
(772
)

(2,738
)

(157
)
 
(1,100
)
 
(3,348
)
 
278

 
(640
)

(1,982
)

513

 
(939
)
 
(1,435
)
 
(1,309
)
Total VaR
$
9,872


$
18,274


$
4,251

 
$
10,640

 
$
19,391

 
$
4,391

 
$
6,620


$
11,348


$
3,580

 
$
16,497

 
$
10,507

 
$
4,111

TABLE 27: TEN-DAY STRESSED VALUE-AT-RISK ASSOCIATED WITH TRADING ACTIVITIES FOR COVERED POSITIONS
 
 
 
Three Months Ended
 
As of March 31, 2019
 
As of December 31, 2018
 
As of March 31, 2018
 
March 31, 2019
 
December 31, 2018
 
March 31, 2018
 
 
 
(In thousands)
Avg.
 
Max.
 
Min.
 
Avg.
 
Max.
 
Min.
 
Avg.
 
Max.
 
Min.
 
Stressed VaR
 
Stressed VaR
 
Stressed VaR
Global Markets
$
26,810


$
49,359


$
15,052

 
$
30,678

 
$
58,221

 
$
14,875

 
$
34,136


$
56,764


$
20,411

 
$
39,238

 
$
26,512

 
$
45,984

Global Treasury
4,999


9,530


1,953

 
4,495

 
8,896

 
1,838

 
4,118


10,177


342

 
6,761

 
7,683

 
7,024

Diversification
(5,426
)

(10,857
)

(1,710
)
 
(4,804
)
 
(8,898
)
 
(1,818
)
 
(4,194
)

(10,644
)

(275
)
 
(8,592
)
 
(7,919
)
 
(8,019
)
Total VaR
$
26,383


$
48,032


$
15,295

 
$
30,369

 
$
58,219

 
$
14,895

 
$
34,060


$
56,297


$
20,478

 
$
37,407

 
$
26,276

 
$
44,989


The three month average of our stressed VaR-based measure was approximately $26 million for the quarter ended March 31, 2019 compared to an average of approximately $30 million for the quarter ended December 31, 2018 and $34 million for the quarter ended March 31, 2018. The decrease in the stressed VaR is primarily attributed to lower interest-rate basis risk in emerging markets.
The VaR-based measures presented in the preceding tables are primarily a reflection of the overall level of market volatility and our appetite for taking market risk in our trading activities. Overall levels of volatility have been low both on an absolute basis and relative to the historical information observed at the beginning of the period used for the calculations.
 
We may in the future modify and adjust our models and methodologies used to calculate VaR and stressed VaR, subject to regulatory review and approval, and these modifications and adjustments may result in changes in our VaR-based and stressed VaR-based measures. The following tables present the VaR and stressed-VaR associated with our trading activities attributable to FX risk, interest-rate risk and volatility risk as of March 31, 2019, December 31, 2018 and March 31, 2018. Diversification effect in the table below represents the difference between total VaR and the sum of the VaRs for each risk category. This effect arises because the risk categories are not perfectly correlated.

State Street Corporation | 35

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


TABLE 28: TEN-DAY VALUE-AT-RISK ASSOCIATED WITH TRADING ACTIVITIES BY RISK FACTOR FOR COVERED POSITIONS(1)
 
As of March 31, 2019
 
As of December 31, 2018
 
As of March 31, 2018
(In thousands)
Foreign Exchange Risk
 
Interest Rate Risk
 
Volatility Risk
 
Foreign Exchange Risk
 
Interest Rate Risk
 
Volatility Risk
 
Foreign Exchange Risk
 
Interest Rate
 
Volatility Risk
By component:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Global Markets
$
3,837


$
14,401


$
327

 
$
2,679

 
$
11,850

 
$
—

 
$
2,407


$
3,806


$
243

Global Treasury
47


836


—

 
53

 
1,377

 
—

 
62


1,148


—

Diversification
(62
)

(746
)

—

 
(39
)
 
(1,436
)
 
—

 
(54
)

(1,575
)

—

Total VaR
$
3,822


$
14,491


$
327

 
$
2,693

 
$
11,791

 
$
—

 
$
2,415


$
3,379


$
243

TABLE 29: TEN-DAY STRESSED VALUE-AT-RISK ASSOCIATED WITH TRADING ACTIVITIES BY RISK FACTOR FOR COVERED POSITIONS(1)
 
As of March 31, 2019
 
As of December 31, 2018
 
As of March 31, 2018
(In thousands)
Foreign Exchange Risk
 
Interest Rate Risk
 
Volatility Risk
 
Foreign Exchange Risk
 
Interest Rate Risk
 
Volatility Risk
 
Foreign Exchange Risk
 
Interest Rate
 
Volatility Risk
By component:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Global Markets
$
12,870


$
45,137


$
421

 
$
10,465

 
$
23,324

 
$
—

 
$
10,520


$
44,416


$
273

Global Treasury
126


7,121


—

 
74

 
8,202

 
—

 
126


7,173


—

Diversification
(162
)

(10,467
)

—

 
(132
)
 
(7,835
)
 
—

 
(225
)

(8,218
)

—

Total VaR
$
12,834


$
41,791


$
421

 
$
10,407

 
$
23,691

 
$
—

 
$
10,421


$
43,371


$
273

 
 
 
(1) For purposes of risk attribution by component, FX refers only to the risk from market movements in period-end rates.  Forwards, futures, options and swaps with maturities greater than period-end have embedded interest-rate risk that is captured by the measures used for interest-rate risk.  Accordingly, the interest-rate risk embedded in these FX instruments is included in the interest-rate risk component.
Asset and Liability Management Activities
The primary objective of asset and liability management is to provide sustainable NII under varying economic conditions, while protecting the economic value of the assets and liabilities carried in our consolidated statement of condition from the adverse effects of changes in interest rates. While many market factors affect the level of NII and the economic value of our assets and liabilities, one of the most significant factors is our exposure to movements in interest rates. Most of our NII is earned from the investment of client deposits generated by our businesses. We invest these client deposits in assets that conform generally to the characteristics of our balance sheet liabilities, including the currency composition of our significant non-U.S. dollar denominated client liabilities.
We quantify NII sensitivity using an earnings simulation model that includes our expectations for new business growth, changes in balance sheet mix and investment portfolio positioning. This measure compares our baseline view of NII over a twelve-month horizon, based on our internal forecast of interest rates, to a wide range of instantaneous and gradual rate shocks. EVE sensitivity is a discounted cash flow model designed to estimate the fair value of assets and liabilities under a series of interest rate shocks over a long-term horizon. Each approach is routinely monitored as market conditions change and within internally approved risk limits and guidelines.
For additional information about our Asset-and-Liability Management Activities, refer to pages 103 to 104 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our 2018 Form 10-K.
 
In the table below, we report the expected change in NII over the next twelve months from +/-100 bps instantaneous shocks to all tenors on the yield curves. We also shock the short-end through a 100 basis point change to rates three months and less with a gradual reduction to a zero basis point shock at the five year tenor. These are referred to as "short-end shocks" in the NII sensitivity table. We separately shock the long-end 100 basis points from the five year tenor and longer, with a gradual reduction to a zero basis point shock at the three month tenor. These are referred to as "long-end shocks" in the NII sensitivity table. Each scenario assumes no management action is taken to mitigate the adverse effects of interest rate changes on our financial performance. While investment securities balances can fluctuate with the level of rates as prepayment assumptions change, our deposit balances remain consistent with the baseline.
TABLE 30: NET INTEREST INCOME SENSITIVITY
(In millions)
March 31,
2019
 
March 31,
2018
Rate change:
Benefit (Exposure)
Parallel shifts:
 
 
 
+100 bps shock
$
341


$
524

–100 bps shock
(142
)

(359
)
Steeper yield curve:





+100 bps long-end shock
109


162

-100 bps short-end shock
2


(180
)
Flatter yield curve:





+100 bps short-end shock
239


369

-100 bps long-end shock
(137
)

(177
)

State Street Corporation | 36

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


As of March 31, 2019, NII sensitivity remains positioned to benefit from rising interest-rates. Compared to March 31, 2018, our NII is less sensitive to instantaneous shifts in both higher and lower rate scenarios. For the short-end shocks, the reduction in NII sensitivity was driven by changes to the U.S. deposit composition and increasing pricing betas. For the long-end shocks, the reduction in NII sensitivity was driven by a continued shift toward more fixed-rate securities in the investment portfolio.
We also measure how much of the NII sensitivity change is a result of shifts in U.S. and non-U.S. rates, as shown in the table below.
TABLE 31: NET INTEREST INCOME SENSITIVITY BY CURRENCY

March 31, 2019
(In millions)
U.S. Dollar

All Other Currencies

Total
Rate change:
Benefit (Exposure)
Parallel shifts:





+100 bps shock
$
103


$
238


$
341

–100 bps shock
(165
)

23


(142
)







March 31, 2018
(In millions)
U.S. Dollar

All Other Currencies

Total
Rate change:
Benefit (Exposure)
Parallel shifts:





+100 bps shock
$
278


$
246


$
524

–100 bps shock
(368
)

9


(359
)
Compared to March 31, 2018, our U.S. rate sensitivity has decreased driven by changes to our deposit composition and rising pricing betas along with adding more fixed-rate securities to the investment portfolio. This has also resulted in the majority of our current U.S. rate impacts to be driven by the long-end of the curve. Non-U.S. rate sensitivities are largely unchanged versus March 31, 2018. The majority of the benefit to higher non-U.S.rates is driven by the short-end of the curve given deposit pricing expectations for currencies such as Euro and Sterling.
The following table highlights our EVE sensitivity to a +/-200 bps instantaneous rate shock, relative to spot interest rates. Management compares the change in EVE sensitivity against our aggregate tier 1 and tier 2 risk-based capital, calculated in conformity with current applicable regulatory requirements. EVE sensitivity is dependent on the timing of interest and principal cash flows. Also, the measure only evaluates the spot balance sheet and does not include the impact of new business assumptions.
 
TABLE 32: ECONOMIC VALUE OF EQUITY SENSITIVITY
(In millions)
March 31,
2019
 
March 31,
2018
Rate change:
Benefit (Exposure)
+200 bps shock
$
(1,615
)
 
$
(1,375
)
–200 bps shock
605

 
145

As of March 31, 2019, EVE sensitivity remains exposed to upward shifts in interest rates. Compared to March 31, 2018, the change in the up 200 bps instantaneous shock was driven by investment portfolio purchases in fixed-rate securities, partially offset by lower long-end U.S. rates. The change in the down 200 bps instantaneous shock was primarily due to a modeling enhancement implemented in the second quarter of 2018 for negative rate currencies. The modeling enhancement allows for interest rate shocks to go below zero for certain currencies, such as Euro, where central banks have allowed negative rates. The March 31, 2018 position in the down 200 bps shock scenario, which does not reflect the modeling enhancement, would have increased approximately $1 billion under the new modeling approach. This update aligns our modeling approaches for negative rates in both EVE and NII sensitivity simulations.
Model Risk Management
The use of models is widespread throughout the financial services industry, with large and complex organizations relying on sophisticated models to support numerous aspects of their financial decision making. The models contemporaneously represent both a significant advancement in financial management and a source of risk. In large banking organizations like us, model results influence business decisions, and model failure could have a harmful effect on our financial performance. As a result, the Model Risk Management Framework seeks to mitigate our model risk.
For additional information about our model risk management framework, including our governance and model validation, refer to pages 104 to 105 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework", in our 2018 Form 10-K.
Strategic Risk Management
We define strategic risk as the current or prospective impact on earnings or capital arising from adverse business decisions, improper implementation of strategic initiatives, or lack of responsiveness to industry-wide changes. Strategic risks are influenced by changes in the competitive environment; decline in market performance or changes in our business activities; and the potential secondary impacts of reputational risks, not already captured as market, interest rate, credit, operational, model or liquidity risks. We incorporate strategic risk into our assessment of our business plans and risk and capital management

State Street Corporation | 37

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


processes. Active management of strategic risk is an integral component of all aspects of our business.
For additional information about our strategic risk management framework, refer to page 105 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework", in our 2018 Form 10-K.
Capital
Managing our capital involves evaluating whether our actual and projected levels of capital are commensurate with our risk profile, are in compliance with all applicable regulatory requirements and are sufficient to provide us with the financial flexibility to undertake future strategic business initiatives. We assess capital adequacy based on relevant regulatory capital requirements, as well as our own internal capital goals, targets and other relevant metrics.
Governance
We have a hierarchical structure supporting appropriate committee review of relevant risk and capital information. The ongoing responsibility for capital management rests with our Treasurer. The Capital Management group within Global Treasury is responsible for the Capital Policy and guidelines, development of the Capital Plan, the oversight of global capital management and optimization.
The Management Risk and Capital Committee (MRAC) provides oversight of our capital management, our capital adequacy, our internal targets and the expectations of the major independent credit rating agencies. In addition, MRAC approves our balance sheet strategy and related activities. The Board’s Risk Committee (RC) assists the Board in fulfilling its oversight responsibilities related to the assessment and management of risk and capital. Our Capital Policy is reviewed and approved annually by the Board's RC.
For additional information about our capital, refer to pages 105 to 112 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our 2018 Form 10-K.
Global Systemically Important Bank
We are one among a group of 29 institutions worldwide that have been identified by the Financial Stability Board and the Basel Committee on Banking Supervision as G-SIBs. Our designation as a G-SIB is based on a number of factors, as evaluated by banking regulators, and requires us to maintain an additional capital surcharge above the minimum capital ratios set forth in the Basel III final rule.
In addition to the Basel III final rule, we are subject to the Federal Reserve's final rule imposing a capital surcharge on U.S. G-SIBs. The surcharge requirements within the final rule began to phase-in on January 2016 and became fully effective on January 1, 2019. The eight
 
U.S. banks deemed to be G-SIBs, including us, are required to calculate the G-SIB surcharge annually according to the following two methods, and be bound by the higher of the two:
•
Method 1: Assesses systemic importance based upon five equally-weighted components: size, interconnectedness, complexity, cross-jurisdictional activity and substitutability; or
•
Method 2: Alters the calculation from Method 1 by factoring in a wholesale funding score in place of substitutability and applying a 2x multiplier to the sum of the five components.
Method 2 currently is the binding methodology for us, and our applicable surcharge for 2019 was calculated to be 1.5%, which is based on a calculation date of December 31, 2017. Assuming a countercyclical buffer of 0%, the minimum capital ratios as of January 1, 2019, including a capital conservation buffer of 2.5% and a G-SIB surcharge of 1.5%, are 8.5% for CET1 capital, 10.0% for tier 1 risk-based capital and 12.0% for total risk-based capital, in order for us to make capital distributions and discretionary bonus payments without limitation. Based on a calculation date of December 31, 2018, our G-SIB surcharge for 2020 will be reduced to 1.0%. This reduction was driven by 2018 strategic balance sheet repositioning and risk reduction actions.
Further, like all other U.S. G-SIBs, we are also currently subject to a 2.0% leverage buffer under the Basel III final rule, subject to the Federal Reserve’s proposed changes to the SLR. If we fail to exceed the 2.0% leverage buffer, we will be subject to increased restrictions (depending upon the extent of the shortfall) regarding capital distributions and discretionary executive bonus payments. Not all of our competitors have similarly been designated as systemically important nor are all of them subject to the same degree of regulation as a bank or financial holding company, and therefore some of our competitors may not be subject to the same capital liquidity and other regulatory requirements.
Regulatory Capital
We and State Street Bank, as advanced approaches banking organizations, are subject to the U.S. Basel III framework. Provisions of the Basel III final rule became effective with full implementation on January 1, 2019. We are also subject to the final market risk capital rule issued by U.S. banking regulators effective as of January 2013.
The Basel III final rule provides for two frameworks for monitoring capital adequacy: the “standardized” approach and the “advanced” approaches, applicable to advanced approaches banking organizations, like us. The standardized approach prescribes standardized calculations for credit RWA, including specified risk

State Street Corporation | 38

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


weights for certain on- and off-balance sheet exposures.
The advanced approaches consist of the Advanced Internal Ratings-Based Approach used for the calculation of RWA related to credit risk, and the Advanced Measurement Approach used for the calculation of RWA related to operational risk.
The final market risk capital rule requires us to use internal models to calculate daily measures of VaR, that reflect general market risk for certain of our trading positions defined by the rule as “covered positions,” as well as stressed-VaR measures to supplement the VaR measures. The rule also requires a public disclosure composed of qualitative and quantitative information about the market risk associated with our trading activities and our related VaR and stressed-VaR measures. The qualitative and quantitative information required by the rule is provided under "Market Risk" included in this Management's Discussion and Analysis.
As required by the Dodd-Frank Act, we and State Street Bank, as advanced approaches banking organizations, are subject to a permanent "capital floor," also referred to as the Collins Amendment, in the assessment of our regulatory capital adequacy, including the capital conservation buffer and countercyclical capital buffer. Our risk-based capital ratios for regulatory assessment purposes are the lower of each ratio calculated under the standardized approach and the advanced approaches.
The requirement for the capital conservation buffer became effective with full implementation on January 1, 2019. Specifically, the final rule limits a banking organization’s ability to make capital distributions and discretionary bonus payments to executive officers if it fails to maintain a CET1 capital conservation buffer of more than 2.5% of total RWA and, if deployed during
 
periods of excessive credit growth, a CET1 countercyclical capital buffer of up to 2.5% of total RWA, above each of the minimum CET1, tier 1, and total risk-based capital ratios. The countercyclical capital buffer is currently set at zero by U.S. banking regulators. To maintain the status of the Parent Company as a financial holding company, we and our insured depository institution subsidiaries are required, among other requirements, to be "well capitalized" as defined by the Prompt Corrective Action Framework.
The specific calculation of our and State Street Bank's risk-based capital ratios changed as the provisions of the Basel III final rule related to the numerator (capital) and denominator (RWA) were phased in, and as our RWA calculated using the advanced approaches changed due to changes in methodology. These methodological changes result in differences in our reported capital ratios from one reporting period to the next that are independent of applicable changes to our capital base, our asset composition, our off-balance sheet exposures or our risk profile.
The following table presents the regulatory capital structure and related regulatory capital ratios for us and State Street Bank as of the dates indicated. We are subject to the more stringent of the risk-based capital ratios calculated under the standardized approach and those calculated under the advanced approaches in the assessment of our capital adequacy under applicable bank regulatory standards.
As a result of changes in the methodologies used to calculate our regulatory capital ratios from period to period, as the provisions of the Basel III final rule were phased in, the ratios presented in the table for each period are not directly comparable. Refer to the footnotes following the table.

State Street Corporation | 39

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


TABLE 33: REGULATORY CAPITAL STRUCTURE AND RELATED REGULATORY CAPITAL RATIOS
 
State Street
 
State Street Bank
(Dollars in millions)
Basel III Advanced Approaches March 31, 2019

Basel III Standardized Approach March 31, 2019

Basel III Advanced Approaches December 31, 2018(1)

Basel III Standardized Approach December 31, 2018(1)

Basel III Advanced Approaches March 31, 2019

Basel III Standardized Approach March 31, 2019

Basel III Advanced Approaches December 31, 2018(1)

Basel III Standardized Approach December 31, 2018(1)
 Common shareholders' equity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock and related surplus
$
10,586

 
$
10,586

 
$
10,565

 
$
10,565

 
$
12,894

 
$
12,894

 
$
12,894

 
$
12,894

Retained earnings
20,911

 
20,911

 
20,606

 
20,606

 
14,273

 
14,273

 
14,261

 
14,261

Accumulated other comprehensive income (loss)
(1,168
)
 
(1,168
)
 
(1,332
)
 
(1,332
)
 
(954
)
 
(954
)
 
(1,112
)
 
(1,112
)
Treasury stock, at cost
(8,969
)
 
(8,969
)
 
(8,715
)
 
(8,715
)
 
—

 
—

 
—

 
—

Total
21,360

 
21,360

 
21,124

 
21,124

 
26,213

 
26,213

 
26,043

 
26,043

Regulatory capital adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill and other intangible assets, net of associated deferred tax liabilities
(9,294
)
 
(9,294
)
 
(9,350
)
 
(9,350
)
 
(9,016
)
 
(9,016
)
 
(9,073
)
 
(9,073
)
Other adjustments(2)
(167
)
 
(167
)
 
(194
)
 
(194
)
 
(1
)
 
(1
)
 
(29
)
 
(29
)
 Common equity tier 1 capital
11,899

 
11,899

 
11,580

 
11,580

 
17,196

 
17,196

 
16,941

 
16,941

Preferred stock
3,690

 
3,690

 
3,690

 
3,690

 
—

 
—

 
—

 
—

 Tier 1 capital
15,589

 
15,589

 
15,270

 
15,270

 
17,196

 
17,196

 
16,941

 
16,941

Qualifying subordinated long-term debt
787

 
787

 
778

 
778

 
785

 
785

 
776

 
776

Allowance for loan and lease losses
10

 
84

 
14

 
83

 
6

 
83

 
11

 
83

 Total capital
$
16,386

 
$
16,460

 
$
16,062

 
$
16,131

 
$
17,987

 
$
18,064

 
$
17,728

 
$
17,800

 Risk-weighted assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit risk(3)
$
49,451

 
$
102,284

 
$
47,738

 
$
97,303

 
$
47,106

 
$
99,673

 
$
45,565

 
$
94,776

Operational risk(4)
47,213

 
NA

 
46,060

 
NA

 
44,416

 
NA

 
44,494

 
NA

Market risk
1,359

 
1,359

 
1,517

 
1,517

 
1,359

 
1,359

 
1,517

 
1,517

Total risk-weighted assets
$
98,023

 
$
103,643

 
$
95,315

 
$
98,820

 
$
92,881

 
$
101,032

 
$
91,576

 
$
96,293

Adjusted quarterly average assets
$
210,099

 
$
210,099

 
$
211,924

 
$
211,924

 
$
207,417

 
$
207,417

 
$
209,413

 
$
209,413

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capital Ratios:
2019 Minimum Requirements Including Capital Conservation Buffer and G-SIB Surcharge(5)
2018 Minimum Requirements Including Capital Conservation Buffer and G-SIB Surcharge(6)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common equity tier 1 capital
8.5
%
7.5
%
12.1
%

11.5
%
 
12.1
%
 
11.7
%
 
18.5
%
 
17.0
%
 
18.5
%
 
17.6
%
Tier 1 capital
10.0

9.0

15.9

 
15.0

 
16.0

 
15.5

 
18.5

 
17.0

 
18.5

 
17.6

Total capital
12.0

11.0

16.7

 
15.9

 
16.9

 
16.3

 
19.4

 
17.9

 
19.4

 
18.5

 
 
 
 
(1) Under the applicable bank regulatory rules, we are not required to and, accordingly, did not revise previously-filed reported capital metrics and ratios following the change in accounting for LIHTC.
(2) Other adjustments within CET1 capital primarily include the overfunded portion of our defined benefit pension plan obligation net of associated deferred tax liabilities, disallowed deferred tax assets, and other required credit risk based deductions.
(3) Includes a CVA which reflects the risk of potential fair value adjustments for credit risk reflected in our valuation of over-the-counter (OTC) derivative contracts. We used a simple CVA approach in conformity with the Basel III advanced approaches.
(4) Under the current advanced approaches rules and regulatory guidance concerning operational risk models, RWA attributable to operational risk can vary substantially from period-to-period, without direct correlation to the effects of a particular loss event on our results of operations and financial condition and impacting dates and periods that may differ from the dates and periods as of and during which the loss event is reflected in our financial statements, with the timing and categorization dependent on the processes for model updates and, if applicable, model revalidation and regulatory review and related supervisory processes. An individual loss event can have a significant effect on the output of our operational RWA under the advanced approaches depending on the severity of the loss event and its categorization among the seven Basel-defined UOMs.
(5) Minimum requirements were phased in with full implementation beginning on January 1, 2019; minimum requirements listed are as of March 31, 2019.
(6) Minimum requirements were phased in with full implementation beginning on January 1, 2019; minimum requirements listed are as of December 31, 2018.
NA Not applicable

State Street Corporation | 40

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Our CET1 capital increased $0.32 billion as of March 31, 2019 compared to December 31, 2018, primarily driven by net income of $0.51 billion and accumulated other comprehensive income of $0.16 billion in the first quarter of 2019, partially offset by common stock repurchases of $0.30 billion and capital distributions of $0.23 billion from common and preferred stock dividends.
Our tier 1 capital increased $0.32 billion as of March 31, 2019 compared to December 31, 2018 under both the advanced approaches and standardized approach due to the changes in our CET1 capital. Total capital increased under the advanced approaches and standardized approach by $0.32 billion and $0.33 billion, respectively, due to the changes in our CET1 and tier 2 capital.
The table below presents a roll-forward of CET1 capital, tier 1 capital and total capital for the first quarter of 2019 and for the year ended December 31, 2018.
TABLE 34: CAPITAL ROLL-FORWARD
(In millions)
Basel III Advanced Approaches March 31, 2019
 
Basel III Standardized Approach March 31, 2019
 
Basel III Advanced Approaches December 31, 2018(1)
 
Basel III Standardized Approach December 31, 2018(1)
Common equity tier 1 capital:
 
 
 
 
 
 
 
Common equity tier 1 capital balance, beginning of period
$
11,580

 
$
11,580

 
$
12,204

 
$
12,204

Net income
508

 
508

 
2,599

 
2,599

Changes in treasury stock, at cost
(253
)
 
(253
)
 
314

 
314

Dividends declared
(233
)
 
(233
)
 
(853
)
 
(853
)
Goodwill and other intangible assets, net of associated deferred tax liabilities
56

 
56

 
(2,473
)
 
(2,473
)
Effect of certain items in accumulated other comprehensive income (loss)
163

 
163

 
(360
)
 
(360
)
Other adjustments
78

 
78

 
149

 
149

Changes in common equity tier 1 capital
319

 
319

 
(624
)
 
(624
)
Common equity tier 1 capital balance, end of period
11,899

 
11,899

 
11,580

 
11,580

Additional tier 1 capital:
 
 
 
 
 
 
 
Tier 1 capital balance, beginning of period
15,270

 
15,270

 
15,382

 
15,382

Change in common equity tier 1 capital
319

 
319

 
(624
)
 
(624
)
Net issuance of preferred stock
—

 
—

 
494

 
494

Other adjustments
—

 
—

 
18

 
18

Changes in tier 1 capital
319

 
319

 
(112
)
 
(112
)
Tier 1 capital balance, end of period
15,589

 
15,589

 
15,270

 
15,270

Tier 2 capital:
 
 
 
 
 
 
 
Tier 2 capital balance, beginning of period
792

 
861

 
985

 
1,053

Net issuance and changes in long-term debt qualifying as tier 2
9

 
9

 
(202
)
 
(202
)
Changes in Allowance for loan and lease losses and other
(4
)
 
1

 
10

 
11

Change in other adjustments
—

 
—

 
(1
)
 
(1
)
Changes in tier 2 capital
5

 
10

 
(193
)
 
(192
)
Tier 2 capital balance, end of period
797

 
871

 
792

 
861

Total capital:
 
 
 
 
 
 
 
Total capital balance, beginning of period
16,062

 
16,131

 
16,367

 
16,435

Changes in tier 1 capital
319

 
319

 
(112
)
 
(112
)
Changes in tier 2 capital
5

 
10

 
(193
)
 
(192
)
Total capital balance, end of period
$
16,386

 
$
16,460

 
$
16,062

 
$
16,131

 
 
 
 
(1) Under the applicable bank regulatory rules, we are not required to and, accordingly, did not revise previously-filed reported capital metrics and ratios following the change in accounting for LIHTC.

State Street Corporation | 41

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


The following table presents a roll-forward of the Basel III advanced approaches RWA for the first quarter of 2019 and for the year ended December 31, 2018.
TABLE 35: ADVANCED APPROACHES RISK-WEIGHTED ASSETS ROLL-FORWARD
(In millions)
March 31, 2019
 
December 31, 2018
Total risk-weighted assets, beginning of period
$
95,315

 
$
99,156

Changes in credit risk-weighted assets:
 
 
 
Net increase (decrease) in investment securities-wholesale
1,430

 
(940
)
Net increase (decrease) in loans and leases
240

 
(12
)
Net increase (decrease) in securitization exposures
(156
)
 
(3,666
)
Net increase (decrease) in repo-style transaction exposures
118

 
(19
)
Net increase (decrease) in Over-the-counter derivatives exposures
(405
)
 
(1,170
)
Net increase (decrease) in all other(1)
486

 
1,545

Net increase (decrease) in credit risk-weighted assets
1,713

 
(4,262
)
Net increase (decrease) in market risk-weighted assets
(158
)
 
183

Net increase (decrease) in operational risk-weighted assets
1,153

 
238

Total risk-weighted assets, end of period
$
98,023

 
$
95,315




(1) Includes assets not in a definable category, cleared transactions, non-material portfolio, other wholesale, cash and due from, and interest-bearing deposits with banks, equity exposures and 6% credit risk supervisory charge.
As of March 31, 2019, total advanced approaches RWA increased $2.71 billion compared to December 31, 2018, primarily due to increases in both credit RWA of $1.71 billion and operational risk RWA of $1.15 billion. The increase in credit RWA was primarily driven by an increase in investment securities RWA of $1.36 billion primarily due to purchases of HQLA securities.
 
The following table presents a roll-forward of the Basel III standardized approach RWA for the first quarter of 2019 and for the year ended December 31, 2018.
TABLE 36: STANDARDIZED APPROACH RISK-WEIGHTED ASSETS ROLL-FORWARD
(In millions)
March 31, 2019
 
December 31, 2018
Total risk-weighted assets, beginning of period(1)
$
98,820

 
$
102,683

Changes in credit risk-weighted assets:
 
 
 
Net increase (decrease) in investment securities-wholesale
1,483

 
(2,887
)
Net increase (decrease) in loans and leases
(1,879
)
 
3,104

Net increase (decrease) in securitization exposures
(156
)
 
(3,666
)
Net increase (decrease) in repo-style transaction exposures
5,158

 
(3,156
)
Net increase (decrease) in Over-the-counter derivatives exposures
(303
)
 
(46
)
Net increase (decrease) in all other(2)
678

 
2,605

Net increase (decrease) in credit risk-weighted assets
4,981

 
(4,046
)
Net increase (decrease) in market risk-weighted assets
(158
)
 
183

Total risk-weighted assets, end of period
$
103,643

 
$
98,820

 
 
 
(1) Standardized approach RWA as of the periods noted above were calculated using our estimates, based on our then current interpretation of the Basel III final rule.
(2) Includes assets not in a definable category, cleared transactions, other wholesale, cash and due from, and interest-bearing deposits with banks and equity exposures.
As of March 31, 2019, total standardized approach RWA increased $4.82 billion compared to December 31, 2018, primarily due to higher credit RWA. The main drivers of the credit RWA change were an increase in securities finance RWA of $5.03 billion driven by new exposures and market appreciation, higher investment securities RWA of $1.43 billion from the purchase of HQLA securities, and an increase in other exposures. These increases were partially offset by a reduction in domestic overdrafts RWA of $1.86 billion in the first quarter of 2019.
The regulatory capital ratios as of March 31, 2019, presented in Table 33: Regulatory Capital Structure and Related Regulatory Capital Ratios, are calculated under the standardized approach and advanced approaches in conformity with the Basel III final rule. The advanced approaches-based ratios reflect calculations and determinations with respect to our capital and related matters as of March 31, 2019, based on our and external data, quantitative formulae, statistical models, historical correlations and assumptions, collectively referred to as “advanced systems,” in effect and used by us for those purposes as of the time we first reported such ratios in a quarterly report on Form 10-Q or an annual report on Form 10-K. Significant components of these advanced systems involve the exercise of judgment by us and our regulators, and our advanced systems may not, individually or collectively, precisely represent or

State Street Corporation | 42

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


calculate the scenarios, circumstances, outputs or other results for which they are designed or intended.
Our advanced systems are subject to update and periodic revalidation in response to changes in our business activities and our historical experiences, forces and events experienced by the market broadly or by individual financial institutions, changes in regulations and regulatory interpretations and other factors, and are also subject to continuing regulatory review and approval. For example, a significant operational loss experienced by another financial institution, even if we do not experience a related loss, could result in a material change in the output of our advanced systems and a corresponding material change in our risk exposures, our total RWA and our capital ratios compared to prior periods. An operational loss that we experience could also result in a material change in our capital requirements for operational risk under the advanced approaches, depending on the severity of the loss event, its characterization among the seven Basel-defined UOM, and the stability of the distributional approach for a particular UOM, and without direct correlation to the effects of the loss event, or the timing of such effects, on our results of operations.
Due to the influence of changes in these advanced systems, whether resulting from changes in data inputs, regulation or regulatory supervision or interpretation, specific to us or market activities or experiences or other updates or factors, we expect that our advanced systems and our capital ratios calculated in conformity with the Basel III final rule will change and may be volatile over time, and that those latter changes or volatility could be material as calculated and measured from period to period. The full effects of the Basel III final rule on us and State Street Bank are therefore subject to further evaluation and also to further regulatory guidance, action or rule-making.
Total Loss-Absorbing Capacity (TLAC)
In 2016, the Federal Reserve released its final rule on TLAC, long-term debt (LTD) and clean holding company requirements for U.S. domiciled G-SIBs, such as us, that is intended to improve the resiliency and resolvability of certain U.S. banking organizations through enhanced prudential standards. The TLAC final rule imposes: (1) external TLAC requirements (i.e., combined eligible tier 1 regulatory capital and LTD); (2) separate external LTD requirements; and (3) clean holding company requirements that impose restrictions on certain types of liabilities and limit non-TLAC related third party liabilities to 5.0% of external TLAC. Among other things, the TLAC final rule requires us to comply with minimum requirements for external TLAC and external LTD effective January 1, 2019. Specifically, we must hold (1) combined eligible tier 1 regulatory capital and LTD in the amount equal to the greater of 21.5% of total RWA (18.0% minimum plus a 2.5% capital
 
conservation buffer plus a G-SIB surcharge calculated for these purposes under Method 1 of 1.0%) and 9.5% of total leverage exposure (7.5% minimum plus the SLR buffer of 2.0%), as defined by the SLR final rule; and (2) qualifying external LTD equal to the greater of 7.5% of RWA (6.0% minimum plus a G-SIB surcharge calculated for these purposes under method 2 of 1.5%) and 4.5% of total leverage exposure, as defined by the SLR final rule.
The following table presents external LTD and external TLAC as of March 31, 2019:
TABLE 37: TOTAL LOSS-ABSORBING CAPACITY

As of March 31, 2019
(Dollars in millions)
Actual
 
Requirement(1)
Total loss-absorbing capacity (eligible Tier 1 regulatory capacity and long term debt):
 
 
 
 
 
 
 
Risk-weighted assets
$
26,610

 
25.7
%
 
$
22,283

 
21.5
%
Supplemental leverage ratio
26,610

 
11.3

 
22,419

 
9.5

Long term debt:


 


 


 


Risk-weighted assets
9,813

 
9.5

 
7,773

 
7.5

Supplemental leverage ratio
9,813

 
4.2

 
10,619

 
4.5

 
 
 
 
(1) We have received a one year extension for compliance with LTD SLR to January 1, 2020; all other requirements of the TLAC final rule are effective January 1, 2019.
We requested and received from the Federal Reserve, a one year extension from January 1, 2019 to January 1, 2020, for compliance with the LTD SLR requirements of the TLAC final rule. In granting the extension request, the Federal Reserve noted the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), under which the Federal Reserve and the other U.S. federal banking agencies must promulgate rules to exclude certain central bank placements from the calculation of SLR for custodial banks, such as us. This regulatory change is expected to reduce the LTD we are required to hold as calculated under the current requirements. The extension will allow us to determine the appropriate amount of LTD needed to comply with the LTD SLR requirements of the TLAC rule after the Federal Reserve and the other U.S. federal banking agencies have adopted this regulatory change.
Regulatory Developments
In April 2018, the Federal Reserve Board (FRB) issued a proposed rule which would replace the current 2.0% supplementary leverage ratio buffer for G-SIBs, with a buffer equal to 50% of their G-SIB surcharge. This proposal would also make conforming modifications to our TLAC and eligible LTD requirements applicable to G-SIBs.
In addition, the FRB has issued a separate proposed rule replacing the current 2.5% capital conservation buffer with a firm specific buffer (referred to as the Stress Capital Buffer (SCB), updated annually and tailored to reflect the results of the most recent Federal Reserve’s CCAR supervisory severely adverse

State Street Corporation | 43

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


scenario stress test. The proposal also introduces a Stress Leverage Buffer (SLB) applicable to the tier 1 leverage ratio. Under the proposal, both the SCB and SLB would become effective October 1, 2019. Changes to the final rules, if and when proposed, may be material and the application of the proposed rule involves estimates which cannot reasonably be made at present. Consequently, we have not estimated the impact of the proposed rule.
In April 2019, the FRB issued a proposed rule on the promulgation of regulation for section 402 of the EGRRCPA that was signed into law in May 2018. Under the legislation, specific modifications would allow certain central bank deposits to be excluded from the SLR denominator, or total leverage exposure for custody banks. In the first quarter of 2019, we estimated $46.10 billion of average balances held on deposit at central banks would be excluded from the SLR denominator under our interpretation of the proposed regulation. The EGRRCPA may also impact our TLAC and LTD requirements calibrated to SLR.
Tier 1 Capital and Supplementary Leverage Ratio
In 2014, U.S. banking regulators issued final rules implementing an SLR, for certain bank holding companies, like us, and their insured depository institution subsidiaries, like State Street Bank, which we refer to as the SLR final rule. The SLR final rule requires that, as of January 1, 2018, (i) State Street Bank maintains an SLR of at least 6.0% to be well capitalized under the U.S. banking regulators’ Prompt Corrective Action Framework and (ii) we maintain an SLR of at least 5.0% to avoid limitations on capital distributions and discretionary bonus payments. In addition to the SLR, we are subject to a well capitalized tier 1 leverage ratio requirement of 5.0%, which differs from the SLR primarily in that the denominator of the tier 1 leverage ratio is only a quarterly average of on-balance sheet assets and does not include any off-balance sheet exposures.
 
TABLE 38: TIER 1 AND SUPPLEMENTARY LEVERAGE RATIOS
(Dollars in millions)
March 31, 2019
 
December 31, 2018
State Street:
 
 
 
Tier 1 capital
$
15,589

 
$
15,270

Average assets
219,560

 
221,350

Less: adjustments for deductions from tier 1 capital
(9,461
)
 
(9,426
)
Adjusted average assets
210,099

 
211,924

Off-balance sheet exposures
25,889

 
29,279

Total assets for SLR
$
235,988

 
$
241,203

Tier 1 leverage ratio(1)
7.4
%
 
7.2
%
Supplementary leverage ratio
6.6

 
6.3

 
 
 
 
State Street Bank:
 
 
 
Tier 1 capital
$
17,196

 
$
16,941

Average assets
216,434

 
218,402

Less: adjustments for deductions from tier 1 capital
(9,017
)
 
(8,989
)
Adjusted average assets
207,417

 
209,413

Off-balance sheet exposures
26,072

 
29,368

Total assets for SLR
$
233,489

 
$
238,781

Tier 1 leverage ratio (1)
8.3
%
 
8.1
%
Supplementary leverage ratio
7.4

 
7.1

 
 
 
(1) Tier 1 leverage ratios were calculated in conformity with the Basel III final rule.

State Street Corporation | 44

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


Capital Actions
Preferred Stock
The following table summarizes selected terms of each of the series of the preferred stock issued and outstanding as of March 31, 2019:
TABLE 39: PREFERRED STOCK ISSUED AND OUTSTANDING
 
Issuance Date
 
Depositary Shares Issued
 
Ownership Interest Per Depositary Share
 
Liquidation Preference Per Share
 
Liquidation Preference Per Depositary Share
 
Net Proceeds of Offering
(In millions)
 
Redemption Date(1)
Preferred Stock(2):
 
 
 
 
 
 
 
 
 
 
 
 
Series C
August 2012
 
20,000,000


1/4,000th

$
100,000


$
25


$
488


September 15, 2017
Series D
February 2014
 
30,000,000


1/4,000th

100,000


25


742


March 15, 2024
Series E
November 2014
 
30,000,000


1/4,000th

100,000


25


728


December 15, 2019
Series F
May 2015
 
750,000


1/100th

100,000


1,000


742


September 15, 2020
Series G
April 2016
 
20,000,000


1/4,000th

100,000


25


493


March 15, 2026
Series H
September 2018
 
500,000

 
1/100th
 
100,000

 
1,000

 
494

 
December 15, 2023
 
 
 
 
(1) On the redemption date, or any dividend declaration date thereafter, the preferred stock and corresponding depositary shares may be redeemed by us, in whole or in part, at the liquidation price per share and liquidation price per depositary share plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
(2) The preferred stock and corresponding depositary shares may be redeemed at our option in whole, but not in part, prior to the redemption date upon the occurrence of a regulatory capital treatment event, as defined in the certificate of designation, at a redemption price equal to the liquidation price per share and liquidation price per depositary share plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
The following table presents the dividends declared for each of the series of preferred stock issued and outstanding for the periods indicated:
TABLE 40: PREFERRED STOCK DIVIDENDS
 
Three Months Ended March 31,
 
2019
 
2018
(Dollars in millions, except per share amounts)
Dividends Declared per Share

Dividends Declared per Depositary Share

Total

Dividends Declared per Share

Dividends Declared per Depositary Share

Total
Preferred Stock:
 
 
 
 
 
 
 
 
 
 
 
Series C
$
1,313

 
$
0.33

 
$
6

 
$
1,313

 
$
0.33

 
$
6

Series D
1,475

 
0.37

 
11

 
1,475

 
0.37

 
11

Series E
1,500

 
0.38

 
11

 
1,500

 
0.38

 
11

Series F
2,625

 
26.25

 
20

 
2,625

 
26.25

 
20

Series G
1,338

 
0.33

 
7

 
1,338

 
0.33

 
7

Series H
—

 
—

 
—

 
—

 
—

 
—

Total
 
 
 
 
$
55

 
 
 
 
 
$
55

Common Stock
In June 2018, the Federal Reserve issued a conditional non-objection to our 2018 capital plan, requiring State Street to enhance the management and analysis of counterparty exposures under stress, which was subsequently satisfied. In connection with our capital plan, we repurchased $300 million of our common stock under the 2018 Program in the first quarter of 2019 and may repurchase up to $300 million of our common stock under the 2018 Program in the second quarter of 2019.
 
The table below presents the activity under our common stock purchase program during the period indicated:
TABLE 41: SHARES REPURCHASED
 
Three Months Ended March 31, 2019
 
Shares Acquired
(In millions)
 
Average Cost per Share
 
Total Acquired
(In millions)
2018 Program
4.2


$
70.93


$
300



State Street Corporation | 45

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS


The table below presents the dividends declared on common stock for the periods indicated:
TABLE 42: COMMON STOCK DIVIDENDS
 
Three Months Ended March 31,
 
2019
 
2018
 
Dividends Declared per Share
 
Total
(In millions)
 
Dividends Declared per Share
 
Total
(In millions)
Common Stock
$
0.47

 
$
177

 
$
0.42

 
$
154

Federal and state banking regulations place certain restrictions on dividends paid by subsidiary banks to the parent holding company. In addition, banking regulators have the authority to prohibit bank holding companies from paying dividends. For information concerning limitations on dividends from our subsidiary banks, refer to pages 50 and 51 included under Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities, and to Note 15 on pages 165 to 167 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K. Our common stock and preferred stock dividends, including the declaration, timing and amount thereof, are subject to consideration and approval by the Board at the relevant times.
Stock purchases may be made using various types of mechanisms, including open market purchases, accelerated share repurchases or transactions off market and may be made under Rule 10b5-1 trading programs. The timing of stock purchases, types of transactions and number of shares purchased will depend on several factors, including, market conditions and our capital positions, financial performance and investment opportunities. The common stock purchase program does not have specific price targets and may be suspended at any time.
OFF-BALANCE SHEET ARRANGEMENTS
On behalf of clients enrolled in our securities lending program, we lend securities to banks, broker/dealers and other institutions. In most circumstances, we indemnify our clients for the fair market value of those securities against a failure of the borrower to return such securities. Though these transactions are collateralized, the substantial volume of these activities necessitates detailed credit-based underwriting and monitoring processes. The aggregate amount of indemnified securities on loan totaled $387.31 billion and $342.34 billion as of March 31, 2019 and December 31, 2018, respectively. We require the borrower to provide collateral in an amount in excess of 100% of the fair market value of the securities borrowed. We hold the collateral received in connection with these securities lending services as agent, and the collateral is not recorded in our consolidated statement of condition. We revalue the securities on loan and the collateral daily to determine if additional collateral is
 
necessary or if excess collateral is required to be returned to the borrower. We held, as agent, cash and securities totaling $405.30 billion and $357.89 billion as collateral for indemnified securities on loan as of March 31, 2019 and December 31, 2018, respectively.
The cash collateral held by us as agent is invested on behalf of our clients. In certain cases, the cash collateral is invested in third-party repurchase agreements, for which we indemnify the client against loss of the principal invested. We require the counterparty to the indemnified repurchase agreement to provide collateral in an amount in excess of 100% of the amount of the repurchase agreement. In our role as agent, the indemnified repurchase agreements and the related collateral held by us are not recorded in our consolidated statement of condition. Of the collateral of $405.30 billion and $357.89 billion, referenced above, $47.56 billion and $42.61 billion was invested in indemnified repurchase agreements as of March 31, 2019 and December 31, 2018, respectively. We or our agents held $50.35 billion and $45.06 billion as collateral for indemnified investments in repurchase agreements as of March 31, 2019 and December 31, 2018, respectively.
Additional information about our securities finance activities and other off-balance sheet arrangements is provided in Notes 7, 9 and 11 to the consolidated financial statements in this Form 10-Q.
RECENT ACCOUNTING DEVELOPMENTS
Information with respect to recent accounting developments is provided in Note 1 to the consolidated financial statements in this Form 10-Q.

State Street Corporation | 46


QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information provided under “Market Risk Management” in "Financial Condition" in our Management's Discussion and Analysis in this Form 10-Q, is incorporated by reference herein. For additional information about our market risk framework, refer to pages 97 to 104 included under Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, "Risk Management Framework" in our 2018 Form 10-K.
 
CONTROLS AND PROCEDURES
We have established and maintained disclosure controls and procedures that are designed to ensure that information related to us and our subsidiaries on a consolidated basis required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. For the quarter ended March 31, 2019, our management carried out an evaluation, with the participation of the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the evaluation of these disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2019.
We have established and maintained internal control over financial reporting as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in conformity with U.S. GAAP. In the ordinary course of business, we routinely enhance our internal controls and procedures for financial reporting by either upgrading our current systems or implementing new systems. Changes have been made and may be made to our internal controls and procedures for financial reporting as a result of these efforts. During the quarter ended March 31, 2019, no change occurred in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


State Street Corporation | 47


STATE STREET CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
 
Three Months Ended March 31,
(Dollars in millions, except per share amounts)
2019
 
2018
Fee revenue:
 
 
 
Servicing fees
$
1,251

 
$
1,421

Management fees
420

 
472

Foreign exchange trading services
280

 
304

Securities finance
118

 
141

Processing fees and other
191

 
77

Total fee revenue
2,260

 
2,415

Net interest income:
 
 
 
Interest income
1,027

 
857

Interest expense
354

 
214

Net interest income
673

 
643

Gains (losses) related to investment securities, net:
 
 
 
Gains (losses) from sales of available-for-sale securities, net
—

 
(1
)
Losses from other-than-temporary impairment
(1
)
 
(1
)
Gains (losses) related to investment securities, net
(1
)
 
(2
)
Total revenue
2,932

 
3,056

Provision for loan losses
4

 
—

Expenses:
 
 
 
Compensation and employee benefits
1,229

 
1,249

Information systems and communications
362

 
315

Transaction processing services
242

 
254

Occupancy
116

 
120

Acquisition and restructuring costs
9

 
—

Amortization of other intangible assets
60

 
50

Other
275

 
280

Total expenses
2,293

 
2,268

Income before income tax expense
635

 
788

Income tax expense
127

 
129

Net income
$
508

 
$
659

Net income available to common shareholders
$
452

 
$
603

Earnings per common share:
 
 
 
Basic
$
1.20

 
$
1.64

Diluted
1.18

 
1.62

Average common shares outstanding (in thousands):
 
 
 
Basic
377,915

 
367,439

Diluted
381,703

 
372,619

Cash dividends declared per common share
$
.47

 
$
.42











The accompanying condensed notes are an integral part of these consolidated financial statements.

State Street Corporation | 48



STATE STREET CORPORATION
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(UNAUDITED)
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Net income
$
508

 
$
659

Other comprehensive income (loss), net of related taxes:
 
 
 
Foreign currency translation, net of related taxes of ($3) and $52, respectively
(26
)
 
151

Net unrealized gains (losses) on available-for-sale securities, net of reclassification adjustment and net of related taxes of $108 and ($102), respectively
272

 
(149
)
Net unrealized gains (losses) on available-for-sale securities designated in fair value hedges, net of related taxes of ($1) and $7, respectively
(2
)
 
18

Other-than-temporary impairment on held-to-maturity securities related to factors other than credit, net of related taxes of ($1) and $2, respectively
—

 
—

Net unrealized gains (losses) on cash flow hedges, net of related taxes of $9 and ($19), respectively
24

 
(97
)
Net unrealized gains (losses) on retirement plans, net of related taxes of ($4) and $3, respectively
(8
)
 
12

Other comprehensive income (loss)
260

 
(65
)
Total comprehensive income
$
768

 
$
594

 
 
 
 

































The accompanying condensed notes are an integral part of these consolidated financial statements.

State Street Corporation | 49


STATE STREET CORPORATION
CONSOLIDATED STATEMENT OF CONDITION

 
March 31, 2019
 
December 31, 2018
(Dollars in millions, except per share amounts)
(Unaudited)
 
 
Assets:
 
 
 
Cash and due from banks
$
4,469

 
$
3,597

Interest-bearing deposits with banks
53,864

 
73,040

Securities purchased under resale agreements
1,522

 
4,679

Trading account assets
856

 
860

Investment securities available-for-sale
49,002

 
45,148

Investment securities held-to-maturity (fair value of $40,971 and $41,351)
41,145

 
41,914

Loans and leases (less allowance for losses of $70 and $67)
23,311

 
25,722

Premises and equipment (net of accumulated depreciation of $3,937 and $4,152)
2,230

 
2,214

Accrued interest and fees receivable
3,277

 
3,203

Goodwill
7,549

 
7,446

Other intangible assets
2,208

 
2,369

Other assets
38,899

 
34,404

Total assets
$
228,332

 
$
244,596

Liabilities:
 
 
 
Deposits:
 
 
 
Non-interest-bearing
$
35,295

 
$
44,804

Interest-bearing - U.S.
62,988

 
66,235

Interest-bearing - non-U.S.
64,188

 
69,321

Total deposits
162,471

 
180,360

Securities sold under repurchase agreements
1,420

 
1,082

Other short-term borrowings
947

 
3,092

Accrued expenses and other liabilities
27,274

 
24,232

Long-term debt
11,182

 
11,093

Total liabilities
203,294

 
219,859

Commitments, guarantees and contingencies (Notes 9 and 10)

 

Shareholders’ equity:
 
 
 
Preferred stock, no par, 3,500,000 shares authorized:
 
 
 
Series C, 5,000 shares issued and outstanding
491

 
491

Series D, 7,500 shares issued and outstanding
742

 
742

Series E, 7,500 shares issued and outstanding
728

 
728

Series F, 7,500 shares issued and outstanding
742

 
742

Series G, 5,000 shares issued and outstanding
493

 
493

Series H, 5,000 shares issued and outstanding
494

 
494

Common stock, $1 par, 750,000,000 shares authorized:
 
 
 
503,879,642 and 503,879,642 shares issued, and 376,720,715 and 379,946,724 shares outstanding
504

 
504

Surplus
10,082

 
10,061

Retained earnings
20,911

 
20,553

Accumulated other comprehensive income (loss)
(1,180
)
 
(1,356
)
Treasury stock, at cost (127,158,927 and 123,932,918 shares)
(8,969
)
 
(8,715
)
Total shareholders’ equity
25,038

 
24,737

Total liabilities and shareholders' equity
$
228,332

 
$
244,596




The accompanying condensed notes are an integral part of these consolidated financial statements.

State Street Corporation | 50


STATE STREET CORPORATION
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(UNAUDITED)
(Dollars in millions, except per share amounts, shares in thousands)
Preferred
Stock
 
Common Stock
 
Surplus
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Treasury Stock
 
Total
Shares
(In thousands)
 
Amount
 
Shares
(In thousands)
 
Amount
 
Balance at December 31, 2017
$
3,196

 
503,880

 
$
504

 
$
9,799

 
$
18,809

 
$
(1,009
)
 
136,230

 
$
(9,029
)
 
$
22,270

Net income

 

 

 

 
659

 

 

 

 
659

Other comprehensive income

 

 

 

 


 
(65
)
 

 

 
(65
)
Cash dividends declared:

 


 


 


 


 

 

 

 


  Common stock - $0.42 per share

 


 


 


 
(154
)
 

 


 


 
(154
)
  Preferred stock

 


 


 


 
(55
)
 

 


 


 
(55
)
Common stock acquired

 


 


 


 

 

 
3,324

 
(350
)
 
(350
)
Common stock awards exercised

 


 


 
(3
)
 

 

 
(1,075
)
 
45

 
42

Other

 

 

 


 
3

 

 
(7
)
 


 
3

Balance at March 31, 2018
$
3,196

 
$
503,880

 
$
504

 
$
9,796

 
$
19,262

 
$
(1,074
)
 
$
138,472

 
$
(9,334
)
 
$
22,350

Balance at December 31, 2018
$
3,690

—

$
503,880

—

$
504

—

$
10,061

 
$
20,553

 
$
(1,356
)
—

$
123,933

—

$
(8,715
)
 
$
24,737

Reclassification of certain tax effects(1)
 
 
 
 
 
 
 
 
84

 
(84
)
 
 
 
 
 
—

Net income
 
 
 
 
 
 
 
 
508

 
 
 
 
 
 
 
508

Other comprehensive income
 
 
 
 
 
 
 
 
 
 
260

 
 
 
 
 
260

Cash dividends declared:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Common stock - $0.47 per share
 
 
 
 
 
 
 
 
(177
)
 
 
 
 
 
 
 
(177
)
  Preferred stock
 
 
 
 
 
 
 
 
(55
)
 
 
 
 
 
 
 
(55
)
Common stock acquired
 
 
 
 
 
 
 
 
 
 
 
 
4,230

 
(300
)
 
(300
)
Common stock awards exercised
 
 
 
 
 
 
26

 
 
 
 
 
(1,002
)
 
45

 
71

Other
 
 
 
 
 
 
(5
)
 
(2
)
 
 
 
(2
)
 
1

 
(6
)
Balance at March 31, 2019
$
3,690

 
$
503,880

 
$
504

 
$
10,082

 
$
20,911

 
$
(1,180
)
 
$
127,159

 
$
(8,969
)
 
$
25,038

 
 
 
 
 
(1) Represents the reclassification from accumulated other comprehensive income into retained earnings as a result of our adoption of ASU 2018-02 - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income in the first quarter of 2019.  

 






















The accompanying condensed notes are an integral part of these consolidated financial statements.

State Street Corporation | 51


STATE STREET CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Operating Activities:
 
 
 
Net income
$
508

 
$
659

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
 
Deferred income tax (benefit)
(35
)
 
(33
)
Amortization of other intangible assets
60

 
50

Other non-cash adjustments for depreciation, amortization and accretion, net
244

 
248

(Gains) losses related to investment securities, net
1

 
2

Change in trading account assets, net
4

 
(85
)
Change in accrued interest and fees receivable, net
(74
)
 
(84
)
Change in collateral deposits, net
(1,527
)
 
6,011

Change in unrealized (gains) losses on foreign exchange derivatives, net
(63
)
 
(2,205
)
Change in other assets, net
(732
)
 
(993
)
Change in accrued expenses and other liabilities, net
976

 
1,091

Other, net
143

 
175

Net cash (used in) provided by operating activities
(495
)
 
4,836

Investing Activities:
 
 
 
Net (increase) decrease in interest-bearing deposits with banks
19,176

 
(12,191
)
Net (increase) decrease in securities purchased under resale agreements
3,157

 
(1,895
)
Proceeds from sales of available-for-sale securities
152

 
11,720

Proceeds from maturities of available-for-sale securities
3,959

 
4,438

Purchases of available-for-sale securities
(7,408
)
 
(3,922
)
Proceeds from maturities of held-to-maturity securities
2,606

 
1,155

Purchases of held-to-maturity securities
(2,348
)
 
(1,860
)
Net decrease (increase) in loans and leases
2,409

 
(6,280
)
Business acquisitions, net of cash acquired
(54
)
 
—

Purchases of equity investments and other long-term assets
(71
)
 
(8
)
Purchases of premises and equipment, net
(171
)
 
(147
)
Other, net
264

 
17

Net cash provided by (used in) investing activities
21,671

 
(8,973
)
Financing Activities:
 
 
 
Net (decrease) in time deposits
(5,876
)
 
(1,789
)
Net (decrease) increase in all other deposits
(12,013
)
 
8,410

Net increase (decrease) in other short-term borrowings
(1,807
)
 
(900
)
Payments for long-term debt and obligations under capital leases
(31
)
 
(515
)
Repurchases of common stock
(300
)
 
(350
)
Repurchases of common stock for employee tax withholding
(43
)
 
(70
)
Payments for cash dividends
(234
)
 
(210
)
Net cash (used in) provided by financing activities
(20,304
)
 
4,576

Net increase
872

 
439

Cash and due from banks at beginning of period
3,597

 
2,107

Cash and due from banks at end of period
$
4,469

 
$
2,546

         









The accompanying condensed notes are an integral part of these consolidated financial statements.

State Street Corporation | 52

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

TABLE OF CONTENTS

54
 
 
57
 
 
63
 
 
67
 
 
69
 
 
70
 
 
Note 7. Derivative Financial Instruments
70
 
 
Note 8. Offsetting Arrangements
74
 
 
Note 9. Commitments and Guarantees
76
 
 
Note 10. Contingencies
77
 
 
Note 11. Variable Interest Entities
79
 
 
Note 12. Shareholders' Equity
80
 
 
Note 13. Regulatory Capital
82
 
 
Note 14. Net Interest Income
84
 
 
Note 15. Expenses
84
 
 
Note 16. Occupancy Expense and Information Systems and Communications Expense
84
 
 
Note 17. Earnings Per Common Share
86
 
 
Note 18. Line of Business Information
86
 
 
Note 19. Revenue From Contracts with Customers
87
 
 
Note 20. Non-U.S. Activities
88
 
 
 
 



























We use acronyms and other defined terms for certain business terms and abbreviations, as defined in the acronyms list and glossary accompanying these consolidated financial statements.

State Street Corporation | 53

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 1.    Summary of Significant Accounting Policies
Basis of Presentation
The accounting and financial reporting policies of State Street Corporation conform to U.S. GAAP. State Street Corporation, the Parent Company, is a financial holding company headquartered in Boston, Massachusetts. Unless otherwise indicated or unless the context requires otherwise, all references in these notes to consolidated financial statements to “State Street,” “we,” “us,” “our” or similar references mean State Street Corporation and its subsidiaries on a consolidated basis, including our principal banking subsidiary, State Street Bank.
The accompanying consolidated financial statements should be read in conjunction with the financial and risk factor information included in our 2018 Form 10-K, which we previously filed with the SEC.
The consolidated financial statements accompanying these condensed notes are unaudited. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the consolidated results of operations in these financial statements, have been made. Certain previously reported amounts presented in this Form 10-Q have been reclassified to conform to current-period presentation. Events occurring subsequent to the date of our consolidated statement of condition were evaluated for potential recognition or disclosure in our consolidated financial statements through the date we filed this Form 10-Q with the SEC.




















 
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions in the application of certain of our significant accounting policies that may materially affect the reported amounts of assets, liabilities, equity, revenue and expenses. As a result of unanticipated events or circumstances, actual results could differ from those estimates. These accounting estimates reflect the best judgment of management, but actual results could differ.
Our consolidated statement of condition as of December 31, 2018 included in the accompanying consolidated financial statements was derived from the audited financial statements as of that date, but does not include all notes required by U.S. GAAP for a complete set of consolidated financial statements.




State Street Corporation | 54

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Recent Accounting Developments
Relevant standards that were recently issued but not yet adopted as of March 31, 2019:
Standard
Description
Date of Adoption
Effects on the financial statements or other significant matters
ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments
The standard replaces the existing incurred loss impairment guidance and requires immediate recognition of expected credit losses for financial assets carried at amortized cost, including trade and other receivables, loans and commitments, held-to-maturity debt securities and other financial assets, held at the reporting date to be measured based on historical experience, current conditions and reasonable supportable forecasts. The standard also amends existing impairment guidance for available-for-sale securities, and credit losses will be recorded as an allowance versus a write-down of the amortized cost basis of the security and will allow for a reversal of impairment loss when the credit of the issuer improves. The guidance requires a cumulative effect of initial application to be recognized in retained earnings at the date of initial application.
January 1, 2020, early adoption permitted
We are continuing to assess the impact of the standard on our consolidated financial statements. We have established a steering committee to provide cross-functional governance over the project plan and key decisions, and continue to develop key accounting policies, assess new and existing credit loss models and processes and address data requirements and sources to ensure that the expected credit losses are calculated in accordance with the standard. We have developed credit loss models that are currently under review by our Model Validation Group. Based on our analysis to date, we expect the recognition of credit losses to accelerate under the new standard. We are continuing to assess the extent of the impact on the allowance for credit losses which will be impacted by our portfolio and the macroeconomic factors on the date of adoption. We plan to adopt the new guidance on January 1, 2020.
ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment
The standard simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The ASU requires an entity to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying value exceeds the fair value of the reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss.
January 1, 2020, early adoption permitted
We are evaluating the impacts of early adoption, and will apply this standard prospectively upon adoption.
ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement
The standard eliminates, amends and adds disclosure requirements for fair value measurements.
January 1, 2020, early adoption permitted, including partial early adoption. Provisions that eliminate or amend disclosures can be early adopted without early adopting the new disclosure requirements.
We have elected to early adopt the provisions of the new standard that eliminate or amend disclosures as of December 31, 2018 and our disclosures were modified accordingly. The provisions of the new standard that add disclosures will be adopted upon the effective date of the standard.

ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement. That Is a Service Contract (a consensus of the Financial Accounting Standards Board Emerging Issues Task Force)
This standard addresses accounting for fees paid by a customer for implementation, set-up and other upfront costs incurred in a cloud computing arrangement that is hosted by the vendor, i.e., a service contract. The new guidance aligns treatment for capitalization of implementation costs with guidance on internal-use software.
January 1, 2020, early adoption permitted
We are currently evaluating the impact of the new standard and the early adoption provisions.

State Street Corporation | 55

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Relevant standards that were adopted in the first quarter of 2019:
We adopted ASU 2016-02, Leases (Topic 842) and relevant amendments, effective January 1, 2019. The standard represents a change to lease accounting and requires all leases, other than short-term leases, to be reported on the balance sheet through recognition of a right-of-use asset and a corresponding liability for future lease obligations. The standard also requires incremental disclosures for assets, expenses, and cash flows associated with leases, as well as a maturity analysis of lease liabilities. We adopted Topic 842 by applying the transition method whereby comparative periods have not been restated, and no adjustment to retained earnings was required. Upon adoption of the standard, we recognized right-of-use assets of approximately $0.9 billion and lease liabilities of approximately $1.1 billion. This increase largely relates to the present value of future minimum lease payments due under existing operating leases of office space. No material changes are expected to the recognition of lease expenses in the Consolidated Statement of Income as a result of the adoption of Topic 842. For adoption, we elected Topic 842’s package of three practical expedients, and (1) did not reassess whether any expired or existing contracts are or contain leases, (2) did not reassess the lease classification for any expired or existing leases, and (3) did not reassess initial direct costs for any existing leases. In addition, we made an accounting policy election not to apply the recognition requirements to short-term leases, and elected the practical expedient to not separate lease and nonlease components of leases.
We adopted ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium amortization on Purchased Callable Debt Securities, effective January 1, 2019. The standard shortens the amortization period for certain purchased callable debt securities to the earliest call date. The standard does not impact debt securities which are held at a discount. The guidance requires a cumulative effect of initial application to be recognized in retained earnings at the beginning of the period of adoption. The impact to beginning retained earnings was not material.
We adopted ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, effective January 1, 2019. This standard provides an election to reclassify the stranded tax effects resulting from the enactment of the Tax Cuts and Jobs Act of 2017, from accumulated other comprehensive income to retained earnings. Upon adoption of the standard we reclassified approximately $84 million of stranded tax effects.

 
Change in Accounting Policy
In the first quarter of 2019, we voluntarily changed our accounting method under FASB ASC 323, Investments-Equity Method and Joint Ventures, for investments in LIHTC from the equity method of accounting to the proportional amortization method of accounting. While both methods of accounting are acceptable under U.S. GAAP, we believe the proportional method is preferable because it more fairly represents the economics of investments in LIHTC, which are made primarily for the purpose of receiving tax credits and other tax benefits. In addition, this method aligns to the method typically used by the companies within our industry which have similar investments. In addition to the change in the timing of the recognition of income on investments in LIHTC, amortization of the investments in LIHTC is now recorded fully within the income tax expense line instead of the processing fees and other line on the consolidated statements of operations.

State Street Corporation | 56

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)


This change in accounting method has been applied retrospectively to all prior periods presented herein being revised, resulting in a reduction in the opening balance of retained earnings as of January 1, 2018 of $47 million. In addition, the following table presents the effect of the changes on financial statement line items for prior periods presented:
 
Consolidated Statement of Condition Impact
 
December 31, 2018
(In millions)
As Originally Reported(1)
 
Effect of Change
 
As Adjusted
Assets:
 
 
 
 
 
Other assets
$
34,434

 
$
(30
)
 
$
34,404

Total assets
$
244,626

 
$
(30
)
 
$
244,596

Liabilities and stockholders' equity:
 
 
 
 
 
Accrued expenses and other liabilities
$
24,209

 
$
23

 
$
24,232

Retained earnings
20,606

 
(53
)
 
20,553

Total liabilities and stockholders' equity
$
244,626

 
$
(30
)
 
$
244,596

 
Consolidated Statement of Income Impact
 
Three Months Ended March 31, 2018
(Dollars in millions, except per share amounts)
As Originally Reported(1)
 
Effect of Change
 
As Adjusted
Processing fees and other
$
52

 
$
25

 
$
77

Total fee revenue
2,390

 
25

 
2,415

Income tax expense
102

 
27

 
129

Net income
$
661

 
$
(2
)
 
$
659

Earnings per common share:
Basic
$
1.65

 
$
(.01
)
 
$
1.64

Diluted
1.62

 
—

 
1.62

 
 
 
 
(1) In the first quarter of 2019, we reclassified certain immaterial revenues and expenses related to an affiliated entity from a net presentation to a gross presentation. Previously reported amounts for quarterly periods in 2018 have been reclassified to conform to the 2019 presentation. The impact of change to the statement of cash flows is immaterial.
The following table presents what our results would have been had we continued to utilize the equity method to record investments in LIHTC in the first quarter of 2019:
 
Consolidated Statement of Income Impact
 
Three Months Ended March 31, 2019
(Dollars in millions, except per share amounts)
As Computed under Equity Method
 
Effect of Change
 
As Reported under the Proportional Amortization Method
Processing fees and other
$
169

 
$
22

 
$
191

Total fee revenue
2,238

 
22

22

2,260

Income tax expense
105

 
22

22

127

Net income
$
508

 
$
—

 
$
508

Earnings per common share:
Basic
$
1.20

 
$
—

 
$
1.20

Diluted
1.18

 
—

 
1.18


Note 2.    Fair Value
Fair Value Measurements
We carry trading account assets and liabilities, AFS debt securities, certain equity securities and various types of derivative financial instruments, at fair value in our consolidated statement of condition on a recurring basis. Changes in the fair values of these financial assets and liabilities are recorded either as components of our consolidated statement of income or as components of AOCI within shareholders' equity in our consolidated statement of condition.
We measure fair value for the above-described financial assets and liabilities in conformity with U.S. GAAP that governs the measurement of the fair value of financial instruments. Management believes that its valuation techniques and underlying assumptions used to measure fair value conform to the provisions of U.S. GAAP. We categorize the financial assets and liabilities that we carry at fair value based on a prescribed three-level valuation hierarchy. For information about our valuation techniques for financial assets and financial liabilities measured at fair value and the

State Street Corporation | 57

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

fair value hierarchy, refer to pages 129 to 136 in Note 2 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
The following tables present information with respect to our financial assets and liabilities carried at fair value in our consolidated statement of condition on a recurring basis as of the dates indicated:
 
Fair Value Measurements on a Recurring Basis
 
As of March 31, 2019
(In millions)
Quoted Market
Prices in Active
Markets
(Level 1)
 
Pricing Methods
with Significant
Observable
Market Inputs
(Level 2)
 
Pricing Methods
with Significant
Unobservable
Market Inputs
(Level 3)
 
Impact of Netting(1)
 
Total Net
Carrying Value
in Consolidated
Statement of
Condition
Assets:
 
 
 
 
 
 
 
 
 
Trading account assets:
 
 
 
 
 
 
 
 
 
U.S. government securities
$
34

 
$
—

 
$
—

 
 
 
$
34

Non-U.S. government securities
148

 
176

 
—

 
 
 
324

Other
—

 
498

 
—

 
 
 
498

Total trading account assets
182

 
674

 
—

 
 
 
856

Available-for-sale investment securities:
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
Direct obligations
1,041

 
—

 
—

 
 
 
1,041

Mortgage-backed securities
—

 
20,043

 
—

 
 
 
20,043

Total U.S. Treasury and federal agencies
1,041

 
20,043

 
—

 
 
 
21,084

Asset-backed securities:
 
 
 
 
 
 
 
 
 
Student loans
—

 
481

 
—

 
 
 
481

Credit cards
—

 
586

 
—

 
 
 
586

Collateralized loan obligations
—

 
218

 
668

 
 
 
886

Total asset-backed securities
—

 
1,285

 
668

 

 
1,953

Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
—

 
1,517

 
—

 
 
 
1,517

Asset-backed securities
—

 
884

 
627

 
 
 
1,511

Government securities
—

 
12,572

 
—

 
 
 
12,572

Other(2)
—

 
6,531

 
45

 
 
 
6,576

Total non-U.S. debt securities
—

 
21,504

 
672

 
 
 
22,176

State and political subdivisions
—

 
1,940

 
—

 
 
 
1,940

Collateralized mortgage obligations
—

 
129

 
—

 
 
 
129

Other U.S. debt securities
—

 
1,720

 
—

 
 
 
1,720

Total available-for-sale investment securities
1,041

 
46,621

 
1,340

 

 
49,002

Other assets:
 
 
 
 
 
 
 
 
 
Derivative instruments:
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
—

 
11,140

 
4

 
$
(6,966
)
 
4,178

Total derivative instruments
—

 
11,140

 
4

 
(6,966
)
 
4,178

Other
—

 
442

 
—

 
—

 
442

Total assets carried at fair value
$
1,223

 
$
58,877

 
$
1,344

 
$
(6,966
)
 
$
54,478

Liabilities:
 
 
 
 
 
 
 
 
 
Accrued expenses and other liabilities:
 
 
 
 
 
 
 
 
 
Derivative instruments:
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
$
—

 
$
11,297

 
$
3

 
$
(7,519
)
 
$
3,781

Interest rate contracts
17

 
52

 
—

 
—

 
69

Other derivative contracts
—

 
228

 
—

 
—

 
228

Total derivative instruments
17

 
11,577

 
3

 
(7,519
)
 
4,078

Total liabilities carried at fair value
$
17

 
$
11,577

 
$
3

 
$
(7,519
)
 
$
4,078

 
 
 
 
(1) Represents counterparty netting against level 2 financial assets and liabilities where a legally enforceable master netting agreement exists between us and the counterparty. Netting also reflects asset and liability reductions of $0.64 billion and $1.19 billion, respectively, for cash collateral received from and provided to derivative counterparties.
(2) As of March 31, 2019, the fair value of other non-U.S. debt securities included $1.05 billion of covered bonds and $1.33 billion of corporate bonds.

State Street Corporation | 58

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

 
Fair Value Measurements on a Recurring Basis
 
As of December 31, 2018
(In millions)
Quoted Market
Prices in Active
Markets
(Level 1)
 
Pricing Methods
with Significant
Observable
Market Inputs
(Level 2)
 
Pricing Methods
with Significant
Unobservable
Market Inputs
(Level 3)
 
Impact of Netting(1)
 
Total Net
Carrying Value
in Consolidated
Statement of
Condition
Assets:
 
 
 
 
 
 
 
 
 
Trading account assets:
 
 
 
 
 
 
 
 
 
U.S. government securities
$
34

 
$
—

 
$
—

 
 
 
$
34

Non-U.S. government securities
146

 
179

 
—

 
 
 
325

Other
—

 
501

 
—

 
 
 
501

Total trading account assets
180

 
680

 
—

 
 
 
860

Available-for-sale investment securities:




 
 
 


U.S. Treasury and federal agencies:




 
 
 


Direct obligations
1,039


—


—

 
 

1,039

Mortgage-backed securities
—


15,968


—

 
 

15,968

Total U.S. Treasury and federal agencies
1,039


15,968


—

 
 

17,007

Asset-backed securities:




 
 
 


Student loans
—


541


—

 
 

541

Credit cards
—


583


—

 
 

583

Collateralized loan obligations
—


—


593

 
 

593

Total asset-backed securities
—


1,124


593

 
 

1,717

Non-U.S. debt securities:






 
 
 



Mortgage-backed securities
—


1,682


—

 
 

1,682

Asset-backed securities
—


943


631

 
 

1,574

Government securities
—


12,793


—

 
 

12,793

Other(2)
—


6,544


58

 
 

6,602

Total non-U.S. debt securities
—


21,962


689

 
 

22,651

State and political subdivisions
—


1,918


—

 
 

1,918

Collateralized mortgage obligations
—


195


2

 
 

197

Other U.S. debt securities
—


1,658


—

 
 

1,658

Total available-for-sale investment securities
1,039


42,825


1,284

 
 

45,148

Other assets:




 
 
 
 
 
Derivative instruments:




 
 
 
 
 
Foreign exchange contracts
—


16,382


4

 
$
(11,210
)
 
5,176

Interest rate contracts
13


—


—

 
—

 
13

Total derivative instruments
13


16,382


4

 
(11,210
)
 
5,189

Other
—


395


—

 
—

 
395

Total assets carried at fair value
$
1,232


$
60,282


$
1,288

 
$
(11,210
)
 
$
51,592

Liabilities:





 
 
 
 
Accrued expenses and other liabilities:





 
 
 
 
Derivative instruments:





 
 
 
 
Foreign exchange contracts
$
—


$
16,518


$
4

 
$
(11,564
)
 
$
4,958

Interest rate contracts
—


71


—

 
—

 
71

Other derivative contracts
—


214


—

 
—

 
214

Total derivative instruments
—


16,803


4

 
(11,564
)
 
5,243

Total liabilities carried at fair value
$
—


$
16,803


$
4

 
$
(11,564
)
 
$
5,243

 
 
 
 
 
(1) Represents counterparty netting against level 2 financial assets and liabilities where a legally enforceable master netting agreement exists between us and the counterparty. Netting also reflects asset and liability reductions of $0.99 billion and $1.34 billion, respectively, for cash collateral received from and provided to derivative counterparties.
(2) As of December 31, 2018, the fair value of other non-U.S. debt securities included $1.30 billion of covered bonds and $1.33 billion of corporate bonds.


State Street Corporation | 59

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following tables present activity related to our level 3 financial assets during the first quarters of 2019 and 2018, respectively. Transfers into and out of level 3 are reported as of the beginning of the period presented. During the first quarter of 2018, transfers into level 3 were primarily related to certain ABS, including non-US debt securities. During the first quarter of 2019 , there were no transfers into level 3. During the first quarters of 2019 and 2018, transfers out of level 3 were mainly related to certain ABS, municipal bonds and non-U.S. MBS, for which fair value was measured using prices for which observable market information became available.
 
Fair Value Measurements Using Significant Unobservable Inputs
 
Three Months Ended March 31, 2019
 
Fair Value as of
December 31,
2018
 
Total Realized and
Unrealized Gains (Losses)
 
Purchases
 
Sales
 
Settlements
 
Transfers into
Level 3
 
Transfers
out of Level 3
 
Fair Value 
as of March 31,
2019(1)
 
Change in Unrealized Gains (Losses) Related to Financial Instruments
Held as of
March 31, 2019
(In millions)
 
Recorded in Revenue(1)
 
Recorded in Other Comprehensive Income(1)
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale Investment securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset-backed securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collateralized loan obligations
$
593

 
$
1

 
$
(2
)
 
$
132

 
$
—

 
$
(56
)
 
$
—

 
$
—

 
$
668

 
 
Total asset-backed securities
593

 
1

 
(2
)
 
132

 
—

 
(56
)
 
—

 
—

 
668

 
 
Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset-backed securities
631

 
—

 
(2
)
 
9

 
—

 
(11
)
 
—

 
—

 
627

 
 
Other
58

 
—

 
—

 
—

 
—

 
(1
)
 
—

 
(12
)
 
45

 
 
Total non-U.S. debt securities
689

 
—

 
(2
)
 
9

 
—

 
(12
)
 
—

 
(12
)
 
672

 
 
Collateralized mortgage obligations
2

 
—

 
—

 
—

 
—

 
(2
)
 
—

 
—

 
—

 
 
Total Available-for-sale investment securities
1,284

 
1

 
(4
)
 
141

 
—

 
(70
)
 
—

 
(12
)
 
1,340

 
 
Derivative instruments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
4

 
(3
)
 
—

 
3

 
—

 
—

 
—

 
—

 
4

 
$
(1
)
Total derivative instruments
4

 
(3
)
 
—

 
3

 
—

 
—

 
—

 
—

 
4

 
(1
)
Total assets carried at fair value
$
1,288

 
$
(2
)
 
$
(4
)
 
$
144

 
$
—

 
$
(70
)
 
$
—

 
$
(12
)
 
$
1,344

 
$
(1
)
 
 
 
 
(1) Total realized and unrealized gains (losses) on AFS investment securities are included within gains (losses) related to investment securities, net. Total realized and unrealized gains (losses) on derivative instruments are included within foreign exchange trading services.

State Street Corporation | 60

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

 
Fair Value Measurements Using Significant Unobservable Inputs
 
Three Months Ended March 31, 2018
 
Fair Value
as of
December 31,
2017
 
Total Realized and
Unrealized Gains (Losses)
 
Purchases
 
Sales
 
Settlements
 
Transfers
into
Level 3
 
Transfers
out of
Level 3
 
Fair Value 
as of March 31, 2018(1)
 
Change in Unrealized Gains (Losses) Related to Financial Instruments
Held as of
March 31, 2018
(In millions)
 
Recorded
in
Revenue(1)
 
Recorded
in Other
Comprehensive
Income(1)
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale Investment securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset-backed securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collateralized loan obligations
$
1,358

 
$
1

 
$
(1
)
 
$
318

 
$
(636
)
 
$
(5
)
 
$
—

 
$
(209
)
 
$
826

 
 
Total asset-backed securities
1,358

 
1

 
(1
)
 
318

 
(636
)
 
(5
)
 
—

 
(209
)
 
826

 
 
Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
119

 
—

 
—

 
—

 
—

 
—

 
—

 
(119
)
 
—

 
 
Asset-backed securities
402

 
—

 
—

 
110

 
(310
)
 
2

 
68

 
—

 
272

 
 
Other
204

 
—

 
—

 
—

 
—

 
(26
)
 
—

 
—

 
178

 
 
Total non-U.S. debt securities
725

 
—

 
—

 
110

 
(310
)
 
(24
)
 
68

 
(119
)
 
450

 
 
State and political subdivisions
43

 
—

 
—

 
—

 
—

 
(1
)
 
—

 
(5
)
 
37

 
 
Total Available-for-sale investment securities
2,126


1


(1
)

428


(946
)

(30
)

68


(333
)

1,313

 
 
Other assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative instruments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
1

 
(2
)
 
—

 
4

 
—

 
—

 
—

 
—

 
3

 
$
(2
)
Total derivative instruments
1

 
(2
)
 
—

 
4

 
—

 
—

 
—

 
—

 
3

 
(2
)
Total assets carried at fair value
$
2,127

 
$
(1
)
 
$
(1
)
 
$
432

 
$
(946
)
 
$
(30
)
 
$
68

 
$
(333
)
 
$
1,316

 
$
(2
)
 
 
 
 
 
(1) Total realized and unrealized gains (losses) on AFS investment securities are included within gains (losses) related to investment securities, net. Total realized and unrealized gains (losses) on derivative instruments are included within foreign exchange trading services.
The following table presents quantitative information, as of the dates indicated, about the valuation techniques and significant unobservable inputs used in the valuation of our level 3 financial assets and liabilities measured at fair value on a recurring basis for which we use internally-developed pricing models. The significant unobservable inputs for our level 3 financial assets and liabilities whose fair value is measured using pricing information from non-binding broker/dealer quotes are not included in the table, as the specific inputs applied are not provided by the broker/dealer.
 
Quantitative Information about Level 3 Fair Value Measurements
 
Fair Value
 
 
 
 
 
Weighted-Average
(Dollars in millions)
As of March 31, 2019
 
As of December 31, 2018
 
Valuation Technique
 
Significant Unobservable Input(1)
 
As of March 31, 2019
 
As of December 31, 2018
Significant unobservable inputs readily available to State Street:
Assets:
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments, foreign exchange contracts
$
4

 
$
4

 
Option model
 
Volatility
 
7.8
%
 
11.4
%
Total
$
4

 
$
4

 
 
 
 
 
 
 
 
Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Derivative instruments, foreign exchange contracts
$
3

 
$
4

 
Option model
 
Volatility
 
7.3
%
 
11.4
%
Total
$
3

 
$
4

 
 
 
 
 
 
 
 
 
 
 
 
(1) Significant changes in these unobservable inputs may result in significant changes in fair value measurement of the derivative instrument.

State Street Corporation | 61

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Fair Value Estimates
Estimates of fair value for financial instruments not carried at fair value on a recurring basis in our consolidated statement of condition are generally subjective in nature, and are determined as of a specific point in time based on the characteristics of the financial instruments and relevant market information.
The following tables present the reported amounts and estimated fair values of the financial assets and liabilities not carried at fair value on a recurring basis, as they would be categorized within the fair value hierarchy, as of the dates indicated:
 
 
 
 
 
Fair Value Hierarchy
(In millions)
Reported Amount 
 
Estimated Fair Value
 
Quoted Market Prices in Active Markets (Level 1)
 
Pricing Methods with Significant Observable Market Inputs (Level 2) 
 
Pricing Methods with Significant Unobservable Market Inputs (Level 3)
March 31, 2019
 
 
 
 
 
 
 
 
 
Financial Assets:
 

 
 
 
 
 
 
 
 
Cash and due from banks
$
4,469

 
$
4,469

 
$
4,469

 
$
—

 
$
—

Interest-bearing deposits with banks
53,864

 
53,864

 
—

 
53,864

 
—

Securities purchased under resale agreements
1,522

 
1,522

 
—

 
1,522

 
—

Investment securities held-to-maturity
41,145

 
40,971

 
13,198

 
27,652

 
121

Net loans
23,311

 
23,288

 
—

 
22,245

 
1,043

Other(1)
8,500

 
8,500

 
—

 
8,500

 
—

Financial Liabilities:
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
   Non-interest-bearing
$
35,295

 
$
35,295

 
$
—

 
$
35,295

 
$
—

   Interest-bearing - U.S.
62,988

 
62,988

 
—

 
62,988

 
—

   Interest-bearing - non-U.S.
64,188

 
64,188

 
—

 
64,188

 
—

Securities sold under repurchase agreements
1,420

 
1,420

 
—

 
1,420

 
—

Other short-term borrowings
947

 
947

 
—

 
947

 
—

Long-term debt
11,182

 
11,319

 
—

 
11,142

 
177

Other(1)
8,500

 
8,500

 
—

 
8,500

 
—

 
 
 
 
(1) Represents a portion of underlying client assets related to our enhanced custody business, which clients have allowed us to transfer and re-pledge.
 
 
 
 
 
Fair Value Hierarchy
(In millions)
Reported Amount 
 
Estimated Fair Value
 
Quoted Market Prices in Active Markets (Level 1)
 
Pricing Methods with Significant Observable Market Inputs (Level 2) 
 
Pricing Methods with Significant Unobservable Market Inputs (Level 3)
December 31, 2018
 
 
 
 
 
 
 
 
 
Financial Assets:
 
 
 
 
 
 
 
 
 
Cash and due from banks
$
3,597

 
$
3,597

 
$
3,597

 
$
—

 
$
—

Interest-bearing deposits with banks
73,040

 
73,040

 
—

 
73,040

 
—

Securities purchased under resale agreements
4,679

 
4,679

 
—

 
4,679

 
—

Investment securities held-to-maturity
41,914

 
41,351

 
14,541

 
26,688

 
122

Net loans (excluding leases)(1)
25,722

 
25,561

 
—

 
24,648

 
913

Other(2)
8,500

 
8,500

 
—

 
8,500

 
—

Financial Liabilities:
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
   Non-interest-bearing
$
44,804

 
$
44,804

 
$
—

 
$
44,804

 
$
—

   Interest-bearing - U.S.
66,235

 
66,235

 
—

 
66,235

 
—

   Interest-bearing - non-U.S.
69,321

 
69,321

 
—

 
69,321

 
—

Securities sold under repurchase agreements
1,082

 
1,082

 
—

 
1,082

 
—

Other short-term borrowings
3,092

 
3,092

 
—

 
3,092

 
—

Long-term debt
11,093

 
11,048

 
—

 
10,865

 
183

Other(2)
8,500

 
8,500

 
—

 
8,500

 
—

 
 
 
 
(1) Includes $10 million of loans classified as held-for-sale that were measured at fair value on a non-recurring basis as of December 31, 2018.
(2) Represents a portion of underlying client assets related to our enhanced custody business, which clients have allowed us to transfer and re-pledge.

State Street Corporation | 62

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 3.    Investment Securities
Investment securities held by us are classified as either trading account assets, AFS, HTM or equity securities held at fair value at the time of purchase and reassessed periodically, based on management’s intent. For additional information on our accounting for investment securities, refer to page 137 in Note 3 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
The following table presents the amortized cost, fair value and associated unrealized gains and losses of AFS and HTM investment securities as of the dates indicated:
 
March 31, 2019
 
December 31, 2018
 
Amortized
Cost
 
Gross
Unrealized
 
Fair
Value
 
Amortized
Cost
 
Gross
Unrealized
 
Fair
Value
(In millions)
Gains
 
Losses
 
Gains
 
Losses
 
Available-for-sale:







 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:






 
 
 
 
 
 
 
 
 
Direct obligations
$
1,035


$
6


$
—


$
1,041

 
$
1,035

 
$
4

 
$
—

 
$
1,039

Mortgage-backed securities
20,020


132


109


20,043

 
16,112

 
37

 
181

 
15,968

Total U.S. Treasury and federal agencies
21,055


138


109


21,084

 
17,147

 
41

 
181

 
17,007

Asset-backed securities:







 
 
 
 
 
 
 
 
Student loans(1)
477


4


—


481

 
538

 
4

 
1

 
541

Credit cards
612


—


26


586

 
609

 
—

 
26

 
583

Collateralized loan obligations
889


—


3


886

 
594

 
1

 
2

 
593

Total asset-backed securities
1,978


4


29


1,953

 
1,741

 
5

 
29

 
1,717

Non-U.S. debt securities:







 
 
 
 
 
 
 
 
Mortgage-backed securities
1,520


1


4


1,517

 
1,687

 
—

 
5

 
1,682

Asset-backed securities
1,517


—


6


1,511

 
1,580

 
—

 
6

 
1,574

Government securities
12,489


97


14


12,572

 
12,816

 
22

 
45

 
12,793

Other(2)
6,520


59


3


6,576

 
6,600

 
18

 
16

 
6,602

Total non-U.S. debt securities
22,046


157


27


22,176

 
22,683

 
40

 
72

 
22,651

State and political subdivisions(3)
1,903


39


2


1,940

 
1,905

 
20

 
7

 
1,918

Collateralized mortgage obligations
130


—


1


129

 
200

 
—

 
3

 
197

Other U.S. debt securities
1,715


12


7


1,720

 
1,683

 
1

 
26

 
1,658

Total
$
48,827


$
350


$
175


$
49,002

 
$
45,359

 
$
107

 
$
318

 
$
45,148

Held-to-maturity:







 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:







 
 
 
 
 
 
 
 
Direct obligations
$
13,369


$
—


$
123


$
13,246

 
$
14,794

 
$
—

 
$
199

 
$
14,595

Mortgage-backed securities
22,568


76


250


22,394

 
21,647

 
24

 
518

 
21,153

Total U.S. Treasury and federal agencies
35,937


76


373


35,640

 
36,441

 
24

 
717

 
35,748

Asset-backed securities:











 
 
 
 
 
 
 
 
Student loans(1)
3,286


26


16


3,296

 
3,191

 
35

 
10

 
3,216

Credit cards
—


—


—


—

 
193

 
—

 
—

 
193

Other
1


—


—


1

 
1

 
—

 
—

 
1

Total asset-backed securities
3,287


26


16


3,297

 
3,385

 
35

 
10

 
3,410

Non-U.S. debt securities:







 
 
 
 
 
 
 
 
Mortgage-backed securities
575


82


8


649

 
638

 
77

 
9

 
706

Asset-backed securities
98


—


—


98

 
223

 
—

 
—

 
223

Government securities
399


1


—


400

 
358

 
1

 
—

 
359

Other
44


—


—


44

 
46

 
—

 
—

 
46

Total non-U.S. debt securities
1,116


83


8


1,191

 
1,265

 
78

 
9

 
1,334

Collateralized mortgage obligations
805


40


2


843

 
823

 
38

 
2

 
859

Total
$
41,145


$
225


$
399


$
40,971

 
$
41,914

 
$
175

 
$
738

 
$
41,351

 
 
 
 
(1) Primarily comprised of securities guaranteed by the federal government with respect to at least 97% of defaulted principal and accrued interest on the underlying loans.
(2) As of March 31, 2019 and December 31, 2018, the fair value of other non-U.S. debt securities included $1.05 billion and $1.30 billion, respectively, of covered bonds and $1.33 billion of corporate bonds for both periods.
(3) As of March 31, 2019 and December 31, 2018, the fair value of state and political subdivisions includes securities in trusts of $1.06 billion and $1.05 billion, respectively. Additional information about these trusts is provided in Note 11.



State Street Corporation | 63

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Aggregate investment securities with carrying values of approximately $40.06 billion and $38.87 billion as of March 31, 2019 and December 31, 2018, respectively, were designated as pledged for public and trust deposits, short-term borrowings and for other purposes as provided by law.
The following tables present the aggregate fair values of AFS and HTM investment securities that have been in a continuous unrealized loss position for less than 12 months, and those that have been in a continuous unrealized loss position for 12 months or longer, as of the dates indicated:
 
As of March 31, 2019
 
Less than 12 months
 
12 months or longer
 
Total
(In millions)
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
Available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
$
2,565

 
$
4

 
$
5,147

 
$
105

 
$
7,712

 
$
109

Total U.S. Treasury and federal agencies
2,565

 
4

 
5,147

 
105

 
7,712

 
109

Asset-backed securities:
 
 
 
 
 
 
 
 
 
 
 
Student loans
10

 
—

 
212

 
—

 
222

 
—

Credit cards
89

 
1

 
497

 
25

 
586

 
26

Collateralized loan obligations
586

 
3

 
—

 
—

 
586

 
3

Total asset-backed securities
685


4


709


25


1,394


29

Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
890

 
3

 
111

 
1

 
1,001

 
4

Asset-backed securities
992

 
6

 
—

 
—

 
992

 
6

Government securities
3,345

 
14

 
—

 
—

 
3,345

 
14

Other
721

 
2

 
189

 
1

 
910

 
3

Total non-U.S. debt securities
5,948


25


300


2


6,248


27

State and political subdivisions
—

 
—

 
254

 
2

 
254

 
2

Collateralized mortgage obligations
—

 
—

 
129

 
1

 
129

 
1

Other U.S. debt securities
116

 
2

 
500

 
5

 
616

 
7

Total
$
9,314

 
$
35

 
$
7,039

 
$
140

 
$
16,353

 
$
175

Held-to-maturity:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Direct obligations
$
2,210

 
$
25

 
$
11,036

 
$
98

 
$
13,246

 
$
123

Mortgage-backed securities
357

 
1

 
14,205

 
249

 
14,562

 
250

Total U.S. Treasury and federal agencies
2,567

 
26

 
25,241

 
347

 
27,808

 
373

Asset-backed securities:
 
 
 
 
 
 
 
 


 


Student loans
1,155

 
7

 
507

 
9

 
1,662

 
16

Total asset-backed securities
1,155

 
7

 
507

 
9


1,662


16

Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
99

 
2

 
116

 
6

 
215

 
8

Total non-U.S. debt securities
99


2


116


6


215


8

Collateralized mortgage obligations
101

 
—

 
48

 
2

 
149

 
2

Total
$
3,922


$
35


$
25,912


$
364


$
29,834


$
399


State Street Corporation | 64

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

 
As of December 31, 2018
 
Less than 12 months
 
12 months or longer
 
Total
(In millions)
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
Available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
$
5,058

 
$
21

 
$
5,089

 
$
160

 
$
10,147

 
$
181

Total U.S. Treasury and federal agencies
5,058

 
21

 
5,089

 
160

 
10,147

 
181

Asset-backed securities:
 
 
 
 
 
 
 
 
 
 
 
Student loans
106

 
—

 
218

 
1

 
324

 
1

Credit cards
90

 
—

 
493

 
26

 
583

 
26

   Collateralized loan obligations
548

 
2

 
—

 
—

 
548

 
2

Total asset-backed securities
744

 
2

 
711

 
27

 
1,455

 
29

Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
1,407

 
4

 
118

 
1

 
1,525

 
5

Asset-backed securities
1,479

 
6

 
—

 
—

 
1,479

 
6

Government securities
5,478

 
45

 
—

 
—

 
5,478

 
45

Other
2,167

 
12

 
226

 
4

 
2,393

 
16

Total non-U.S. debt securities
10,531

 
67

 
344

 
5

 
10,875

 
72

State and political subdivisions
365

 
3

 
244

 
4

 
609

 
7

Collateralized mortgage obligations
181

 
3

 
14

 
—

 
195

 
3

Other U.S. debt securities
861

 
14

 
484

 
12

 
1,345

 
26

Total
$
17,740

 
$
110

 
$
6,886

 
$
208

 
$
24,626

 
$
318

Held-to-maturity:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Direct obligations
$
2,192

 
$
45

 
$
12,403

 
$
154

 
$
14,595

 
$
199

   Mortgage-backed securities
6,502

 
103

 
10,648

 
415

 
17,150

 
518

Total U.S. Treasury and federal agencies
8,694

 
148

 
23,051

 
569

 
31,745

 
717

Asset-backed securities:
 
 
 
 
 
 
 
 
 
 
 
Student loans
481

 
4

 
536

 
6

 
1,017

 
10

Total asset-backed securities
481

 
4

 
536

 
6

 
1,017

 
10

Non-U.S. debt securities:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
184

 
2

 
119

 
7

 
303

 
9

Total non-U.S. debt securities
184

 
2

 
119

 
7

 
303

 
9

Collateralized mortgage obligations
102

 
1

 
51

 
1

 
153

 
2

Total
$
9,461

 
$
155

 
$
23,757

 
$
583

 
$
33,218

 
$
738



State Street Corporation | 65

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following table presents contractual maturities of debt investment securities by carrying amount as of March 31, 2019. The maturities of certain ABS, MBS, and CMOs are based on expected principal payments. Actual maturities may differ from these expected maturities since certain borrowers have the right to prepay obligations with or without prepayment penalties.
 
As of March 31, 2019
(In millions)
Under 1 Year
 
1 to 5 Years
 
6 to 10 Years
 
Over 10 Years
 
Total
Available-for-sale:
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
Direct obligations
$
235

 
$
806

 
$
—

 
$
—

 
$
1,041

Mortgage-backed securities
44

 
991

 
2,490

 
16,518

 
20,043

Total U.S. Treasury and federal agencies
279

 
1,797

 
2,490

 
16,518

 
21,084

Asset-backed securities:
 
 
 
 
 
 
 
 

Student loans
94

 
160

 
161

 
66

 
481

Credit cards
200

 
297

 
89

 
—

 
586

Collateralized loan obligations
—

 
418

 
423

 
45

 
886

Total asset-backed securities
294

 
875

 
673

 
111

 
1,953

Non-U.S. debt securities:
 
 
 
 
 
 
 
 

Mortgage-backed securities
266


552


171


528

 
1,517

Asset-backed securities
368


561


446


136

 
1,511

Government securities
3,178


6,802


2,592


—

 
12,572

Other
1,141


4,860


554


21

 
6,576

Total non-U.S. debt securities
4,953

 
12,775

 
3,763

 
685

 
22,176

State and political subdivisions
180


791


525


444

 
1,940

Collateralized mortgage obligations
—


—


—


129

 
129

Other U.S. debt securities
152


1,292


276


—

 
1,720

Total
$
5,858

 
$
17,530

 
$
7,727

 
$
17,887

 
$
49,002

Held-to-maturity:
 
 
 
 
 
 
 
 
 
U.S. Treasury and federal agencies:
 
 
 
 
 
 
 
 
 
Direct obligations
$
3,225


$
10,096


$
11


$
37

 
$
13,369

Mortgage-backed securities
31


236


1,538


20,763

 
22,568

Total U.S. Treasury and federal agencies
3,256

 
10,332

 
1,549

 
20,800

 
35,937

Asset-backed securities:










 


Student loans
7


255


383


2,641

 
3,286

Credit cards
—


—


—


—

 
—

Other
—


—


—


1

 
1

Total asset-backed securities
7

 
255

 
383

 
2,642

 
3,287

Non-U.S. debt securities:
 
 
 
 
 
 
 
 

Mortgage-backed securities
134


40


7


394

 
575

Asset-backed securities
98


—


—


—

 
98

Government securities
286


113


—


—

 
399

Other
44


—


—


—

 
44

Total non-U.S. debt securities
562

 
153

 
7

 
394

 
1,116

Collateralized mortgage obligations
1


313


14


477

 
805

Total
$
3,826

 
$
11,053

 
$
1,953

 
$
24,313

 
$
41,145


Interest income related to debt securities is recognized in our consolidated statement of income using the effective interest method, or on a basis approximating a level rate of return over the contractual or estimated life of the security. The level rate of return considers any non-refundable fees or costs, as well as purchase premiums or discounts, resulting in amortization or accretion, accordingly.
For certain debt securities acquired which are considered to be beneficial interests in securitized financial assets, the excess of our estimate of undiscounted future cash flows from these securities over their initial recorded investment is accreted into interest income on a level-yield basis over the securities’ estimated remaining terms. Subsequent decreases in these securities’ expected future cash flows are either recognized prospectively through an adjustment of the yields on the securities over their remaining terms, or are evaluated for OTTI. Increases in expected future cash flows are recognized prospectively over the securities’ estimated remaining terms through the recalculation of their yields.

State Street Corporation | 66

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Impairment
The following table presents a roll-forward with respect to net impairment losses that have been recognized in income for the periods indicated:
 
 
Three Months Ended March 31,
(In millions)
 
2019
 
2018
Balance, beginning of period
 
$
78

 
$
77

Additions(1):
 
 
 
 
Other-than-temporary-impairment recognized
 
1

 
1

Balance, end of period
 
$
79

 
$
78

 
 
(1) Additions represent securities with a first time credit impairment realized or when a subsequent credit impairment has occurred.
We conduct periodic reviews of individual securities to assess whether OTTI exists. For additional information about the review of securities for impairment, refer to pages 142 to 144 in Note 3 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
We recorded approximately $1 million of OTTI in both the first quarter of 2019 and 2018, on non-U.S. residential MBS, which resulted from adverse changes in the timing of expected future cash flows from the securities.
After a review of the investment portfolio, taking into consideration current economic conditions, adverse situations that might affect our ability to fully collect principal and interest, the timing of future payments, the credit quality and performance of the collateral underlying MBS and ABS and other relevant factors, management considers the aggregate decline in fair value of the investment securities portfolio and the resulting gross pre-tax unrealized losses of $574 million related to 832 securities as of March 31, 2019 to be temporary, and not the result of any material changes in the credit characteristics of the securities.
Note 4.    Loans and Leases
We segregate our loans into two segments: commercial and financial loans and commercial real estate loans. We further classify commercial and financial loans as loans to investment funds, senior secured bank loans, loans to municipalities and other. These classifications reflect their risk characteristics, their initial measurement attributes and the methods we use to monitor and assess credit risk. For additional information on our loans and leases, including our internal risk-rating system used to assess our risk of credit loss for each loan or lease, refer to pages 145 to 147 in Note 4 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
 
The following table presents our recorded investment in loans and leases, by segment, as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Domestic:
 
 
 
Commercial and financial:
 
 
 
Loans to investment funds
$
11,935

 
$
15,050

Senior secured bank loans
3,516

 
3,490

Loans to municipalities
966

 
902

Other
34

 
37

Commercial real estate
976

 
874

Total domestic
17,427

 
20,353

Non-U.S.:
 
 
 
Commercial and financial:
 
 
 
Loans to investment funds
4,989

 
4,505

Senior secured bank loans
965

 
931

Total non-U.S.
5,954

 
5,436

Total loans and leases
23,381

 
25,789

Allowance for loan and lease losses
(70
)
 
(67
)
Loans and leases, net of allowance
$
23,311

 
$
25,722


The commercial and financial segment is composed primarily of floating-rate loans to mutual fund clients, purchased senior secured bank loans and loans to municipalities. Investment fund lending is composed of short-duration revolving credit lines providing liquidity to fund clients in support of their transaction flows associated with securities' settlement activities.
Certain loans are pledged as collateral for access to the Federal Reserve's discount window. As of March 31, 2019 and December 31, 2018, the loans pledged as collateral totaled $7.2 billion and $6.5 billion, respectively.
The following tables present our recorded investment in each class of loans and leases by credit quality indicator as of the dates indicated:
March 31, 2019
Commercial and Financial
 
Commercial Real Estate
 
Total Loans and Leases
(In millions)
Investment grade(1)
$
17,128

 
$
976

 
$
18,104

Speculative(2)
5,277

 
—

 
5,277

Total
$
22,405

 
$
976

 
$
23,381

December 31, 2018
Commercial and Financial
 
Commercial Real Estate
 
Total Loans and Leases
(In millions)
Investment grade(1)
$
19,599

 
$
874

 
$
20,473

Speculative(2)
5,308

 
—

 
5,308

Substandard(3)
8

 
—

 
8

Total
$
24,915

 
$
874

 
$
25,789

 
 
 
 
(1) Investment-grade loans and leases consist of counterparties with strong credit quality and low expected credit risk and probability of default. Ratings apply to counterparties with a strong capacity to support the timely repayment of any financial commitment.
(2) Speculative loans and leases consist of counterparties that face ongoing uncertainties or exposure to business, financial, or economic downturns. However, these counterparties may have financial flexibility or access to financial alternatives, which allow for financial commitments to be met.
(3) Substandard loans and leases consist of counterparties with well-defined weaknesses that jeopardize repayment with the possibility we will sustain some loss.

State Street Corporation | 67

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

As of March 31, 2019 and December 31, 2018, we had no loans or leases on non-accrual status and no loans or leases contractually past due.
In certain circumstances, we restructure troubled loans by granting concessions to borrowers experiencing financial difficulty. Once restructured, the loans are generally considered impaired until their maturity, regardless of whether the borrowers perform under the modified terms of the loans. There were no loans modified in troubled debt restructurings as of both March 31, 2019 and December 31, 2018.
We review all loans individually for indicators of impairment. Loans where indicators exist are evaluated individually for impairment at least quarterly. For those loans where no such indicators are identified, the loans are collectively evaluated for impairment. As of March 31, 2019, there were no indicators of impairment and no impaired loans. As of December 31, 2018, we had one impaired loan for $8 million in the commercial and financial segment that was individually evaluated for impairment and deemed to be impaired. This loan was subsequently paid in full in January 2019.
Allowance for Loan and Lease Losses
The following table presents activity in the ALLL for the periods indicated:
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Allowance for loan and lease losses:
 
 
Beginning balance
$
67

 
$
54

Provision for loan and lease losses(1)
4


—

Other(2)
(1
)

—

Ending balance
$
70

 
$
54

 
 
 
 
(1) The provisions and charge-offs for loans and leases were primarily attributable to exposure to purchased senior secured loans to non-investment grade loans.
(2) Consists primarily of FX translation.
Loans and leases are reviewed on a regular basis, and any provisions for loan and lease losses that are recorded reflect management's estimate of the amount necessary to maintain the ALLL losses at a level considered appropriate to absorb estimated incurred losses in the loan and lease portfolio.

State Street Corporation | 68

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 5.    Goodwill and Other Intangible Assets
The following table presents changes in the carrying amount of goodwill during the periods indicated:
(In millions)
Investment
Servicing(1)
 
Investment
Management
 
Total
Goodwill:
 
 
 
 
 
Ending balance December 31, 2017
$
5,752

 
$
270

 
$
6,022

Acquisitions(1)
1,512

 
—

 
1,512

Foreign currency translation
(84
)
 
(4
)
 
(88
)
Ending balance December 31, 2018
7,180

 
266

 
7,446

Acquisitions(2)
121

 
—

 
121

Foreign currency translation
(18
)
 
—

 
(18
)
Ending balance March 31, 2019
$
7,283

 
$
266

 
$
7,549

 
 
 
 
(1) Investment Servicing includes our acquisition of CRD.
(2) We have completed the purchase price accounting for the CRD acquisition as of March 31, 2019. Upon completion of valuation procedures related to the acquired assets and assumed liabilities, primarily the identifiable intangible assets, we recorded measurement period adjustments in the first quarter of 2019, resulting in an increase in the goodwill of $112 million.
The following table presents changes in the net carrying amount of other intangible assets during the periods indicated:
(In millions)
Investment
Servicing(1)
 
Investment
Management
 
Total
Other intangible assets:
 
 
 
 
 
Ending balance December 31, 2017
$
1,432

 
$
181

 
$
1,613

Acquisitions(1)
1,007

 
—

 
1,007

Amortization
(196
)
 
(30
)
 
(226
)
Foreign currency translation
(25
)
 
—

 
(25
)
Ending balance December 31, 2018
2,218

 
151

 
2,369

Acquisitions(2)
(93
)
 
—

 
(93
)
Amortization
(53
)
 
(7
)
 
(60
)
Foreign currency translation
(8
)
 
—

 
(8
)
Ending balance March 31, 2019
$
2,064

 
$
144

 
$
2,208

 
 
 
 
(1) Investment Servicing includes our acquisition of CRD.
(2) We have completed the purchase price accounting for the CRD acquisition as of March 31, 2019. Upon completion of valuation procedures related to the acquired assets and assumed liabilities, primarily the identifiable intangible assets, we recorded measurement period adjustments in the first quarter of 2019, resulting in a decrease in the fair value of intangible assets of $93 million, with a corresponding increase to goodwill.
The following table presents the gross carrying amount, accumulated amortization and net carrying amount of other intangible assets by type as of the dates indicated:
 
March 31, 2019
 
December 31, 2018
(In millions)
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
Other intangible assets:
 
 
 
 
 
 
 
 
 
 
 
Client relationships
$
3,144

 
$
(1,639
)
 
$
1,505

 
$
3,262

 
$
(1,605
)
 
$
1,657

Technology
403

 
(60
)
 
343

 
389

 
(49
)
 
340

Core deposits
673

 
(356
)
 
317

 
676

 
(350
)
 
326

Other
100

 
(57
)
 
43

 
103

 
(57
)
 
46

Total
$
4,320

 
$
(2,112
)
 
$
2,208

 
$
4,430

 
$
(2,061
)

$
2,369



State Street Corporation | 69

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 6.    Other Assets
The following table presents the components of other assets as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Securities borrowed(1)
$
23,929

 
$
19,575

Derivative instruments, net
4,178

 
5,189

Bank-owned life insurance
3,345

 
3,323

Investments in joint ventures and other unconsolidated entities(2)
2,668

 
2,882

Receivable for securities settlement
969

 
531

Collateral, net
903

 
1,354

Right-of-use assets(3)
899

 
—

Accounts receivable
760

 
343

Prepaid expenses
520

 
493

Income taxes receivable
100

 
129

Deferred tax assets, net of valuation allowance(4)
100

 
113

Deposits with clearing organizations
58

 
58

Other
470

 
414

Total
$
38,899

 
$
34,404

 
 
(1) Refer to Note 8, for further information on the impact of collateral on our financial statement presentation of securities borrowing and securities lending transactions.
(2) Includes certain equity securities held at fair value through profit and loss that were transferred from AFS as part of our adoption of ASU 2016-01.
(3) We adopted ASU 2016-02, Leases (Topic 842) and relevant amendments, effective January 1, 2019. Refer to Note 1 for further information on this new accounting standard.
(4) Deferred tax assets and liabilities recorded in our consolidated statement of condition are netted within the same tax jurisdiction.
Note 7. Derivative Financial Instruments
We use derivative financial instruments to support our clients' needs and to manage our interest rate and currency risks. These financial instruments consist of FX contracts such as forwards, futures and options contracts; interest rate contracts such as interest rate swaps (cross currency and single currency) and futures; and other derivative contracts. Derivative instruments used for risk management purposes that are highly effective in offsetting the risk being hedged are generally designated as hedging instruments in hedge accounting relationships while others are economic hedges and not designated in hedge accounting relationships. For additional information on our derivative financial instruments, including derivatives not designated as hedging instruments, refer to page 152 in Note 10 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
Derivatives Designated as Hedging Instruments
For additional information on our derivatives designated as hedging instruments, including our risk management objectives and hedging documentation
 
methodologies, refer to pages 152 to 153 in Note 10 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
Fair Value Hedges
Derivatives designated as fair value hedges are utilized to mitigate the risk of changes in the fair values of recognized assets and liabilities, including long-term debt, AFS securities, and foreign currency investment securities. We use interest rate or FX contracts in this manner to manage our exposure to changes in the fair value of hedged items caused by changes in interest rates or FX rates.
Changes in the fair value of the derivative and changes in fair value of the hedged item due to changes in the hedged risk are recognized in earnings in the same line item. If a hedge is terminated, all remaining adjustments to the carrying amount of the hedged item shall be amortized over a period that is consistent with the amortization of other discounts or premiums associated with the hedged item.
Cash Flow Hedges
Derivatives designated as cash flow hedges are utilized to offset the variability of cash flows of recognized assets or liabilities or forecasted transactions. We have entered into FX contracts to hedge the change in cash flows attributable to FX movements in foreign currency denominated investment securities. Additionally, we have entered into interest rate swap agreements to hedge the forecasted cash flows associated with London Interbank Offered Rate (LIBOR) indexed floating-rate loans. The interest rate swaps synthetically convert the loan interest receipts from a variable-rate to a fixed-rate, thereby mitigating the risk attributable to changes in the LIBOR benchmark rate.
Changes in fair value of the derivatives designated as cash flow hedges are initially recorded in AOCI and then reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings and are presented in the same income statement line item as the earnings effect of the hedged item. If the hedge relationship is terminated, the change in fair value on the derivative recorded in AOCI is reclassified into earnings consistent with the timing of the hedged item. For hedge relationships that are discontinued because a forecasted transaction is not expected to occur according to the original hedge terms, any related derivative values recorded in AOCI are immediately recognized in earnings. As of March 31, 2019, the maximum maturity date of the underlying loans is approximately 3 years.

State Street Corporation | 70

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Net Investment Hedges
Derivatives categorized as net investment hedges are entered into to protect the net investment in our foreign operations against adverse changes in exchange rates. We use FX forward contracts to convert the foreign currency risk to U.S. dollars to mitigate our exposure to fluctuations in FX rates. The changes in fair value of the FX forward contracts are recorded, net of taxes, in the foreign currency translation component of OCI.
The following table presents the aggregate contractual, or notional, amounts of derivative financial instruments including those entered into for trading and asset-and-liability management activities as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Derivatives not designated as hedging instruments:
 
 
 
Interest rate contracts:
 
 
 
Futures
$
4,387

 
$
2,348

Foreign exchange contracts:
 
 
 
Forward, swap and spot
2,284,676

 
2,238,819

Options purchased
797

 
578

Options written
505

 
576

Futures
414

 
49

Other:
 
 
 
Stable value contracts(1)
26,991

 
26,634

Deferred value awards(2)
559

 
434

Derivatives designated as hedging instruments:
 
 
 
Interest rate contracts:
 
 
 
Swap agreements
10,596

 
10,596

Foreign exchange contracts:
 
 
 
Forward and swap
3,050

 
3,412

 
 
 
(1) The notional value of the stable value contracts generally represents our maximum exposure. However, exposure to various stable value contracts is contractually limited to substantially lower amounts than the notional values, which represent the total assets of the stable value funds.
(2) For additional information on our derivatives not designated as hedging instruments, including deferred value awards, refer to page 152 in Note 10 to the consolidated financial statements under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
Notional amounts are provided here as an indication of the volume of our derivative activity and serve as a reference to calculate the fair values of the derivative.
The following tables present the fair value of derivative financial instruments, excluding the impact of master netting agreements, recorded in our consolidated statement of condition as of the dates indicated. The impact of master netting agreements is provided in Note 8.
 
March 31, 2019
 
December 31, 2018
 
March 31, 2019
 
December 31, 2018
(In millions)
Derivative Assets(1)
 
Derivative Liabilities(2)
Derivatives not designated as hedging instruments:
 
 
 
 
Foreign exchange contracts
$
11,123

 
$
16,369

 
$
11,240

 
$
16,434

Other derivative contracts
—

 
—

 
228

 
214

Total
$
11,123

 
$
16,369

 
$
11,468

 
$
16,648

 
 
 
 
 
 
 
 
Derivatives designated as hedging instruments:
 
 
 
 
Foreign exchange contracts
$
21

 
$
17

 
$
60

 
$
88

Interest rate contracts
—

 
13

 
69

 
71

Total
$
21

 
$
30

 
$
129

 
$
159

 
 
 
(1) Derivative assets are included within other assets in our consolidated statement of condition.
(2) Derivative liabilities are included within other liabilities in our consolidated statement of condition.

    


State Street Corporation | 71

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following tables present the impact of our use of derivative financial instruments on our consolidated statement of income for the periods indicated:
 
 
 
Three Months Ended March 31,
 
 
 
2019

2018
(In millions)
Location of Gain (Loss) on
Derivative in Consolidated
Statement of Income
 
Amount of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income
Derivatives not designated as hedging instruments:
 
 
 
 
Foreign exchange contracts
Foreign exchange trading services revenue
 
$
160

 
$
184

Foreign exchange contracts
Interest expense(1)
 
(39
)
 
(15
)
Interest rate contracts
Foreign exchange trading services revenue
 
(1
)
 
(2
)
Other derivative contracts
Foreign exchange trading services revenue
 
—

 
1

Other derivative contracts
Compensation and employee benefits
 
(74
)
 
(65
)
Total
 
 
$
46

 
$
103

 
 
 
 
 
(1) In the first quarter of 2018, approximately $15 million of swap costs were reclassified from processing fees and other revenue within fee revenue to net interest income to conform to current presentation.
The following table shows the carrying amount and associated cumulative basis adjustments related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships:
 
March 31, 2019
 
Hedged Items Currently Designated
 
Hedged Items No Longer Designated(1)
(In millions)
Carrying Amount of Assets and Liabilities(2)
 
Cumulative Hedge Accounting Basis Adjustments
 
Carrying Amount of Assets and Liabilities
 
Cumulative Hedge Accounting Basis Adjustments
Long-term debt
$
8,271

 
$
(23
)
 
$
1,198

 
$
(17
)
Available-for-sale securities
1,553

 
76

 
50

 
1

Total
$
9,824

 
$
53

 
$
1,248

 
$
(16
)
 
 
 
 
 
 
 
 
 
December 31, 2018
 
Hedged Items Currently Designated
 
Hedged Items No Longer Designated(1)
(In millions)
Carrying Amount of Assets and Liabilities(2)
 
Cumulative Hedge Accounting Basis Adjustments
 
Carrying Amount of Assets and Liabilities
 
Cumulative Hedge Accounting Basis Adjustments
Long-term debt
$
8,270

 
$
(137
)
 
$
1,197

 
$
(20
)
Available-for-sale securities
1,496

 
72

 
50

 
1

Total
$
9,766

 
$
(65
)
 
$
1,247

 
$
(19
)
 
 
 
 
 
(1) Represents hedged items no longer designated in qualifying fair value hedging relationships for which an associated basis adjustment exists at the balance sheet date.
(2) Does not include the carrying amount of hedged items when only foreign currency risk is the designated hedged risk. The carrying amount excluded for investment securities was zero and $458 million for March 31, 2019 and December 31, 2018, respectively.

As of both March 31, 2019 and December 31, 2018, the total notional amount of the interest rate swaps of fair value hedges was $9.30 billion.

State Street Corporation | 72

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following tables present the impact of our use of derivative financial instruments on our consolidated statement of income for the periods indicated:
 
 
 
Three Months Ended March 31,
 
 
 
 
 
Three Months Ended March 31,
 
 
 
2019
 
2018
 
 
 
 
 
2019
 
2018
(In millions)
Location of Gain (Loss) on Derivative in Consolidated Statement of Income
 
Amount of Gain
(Loss) on Derivative
Recognized in
Consolidated
Statement of Income
 
Hedged Item in Fair Value Hedging Relationship
 
Location of Gain (Loss) on Hedged Item in Consolidated Statement of Income
 
Amount of Gain
(Loss) on Hedged
Item Recognized in
Consolidated
Statement of Income
Derivatives designated as fair value hedges:
Foreign exchange contracts
Processing fees and other revenue
 
$
—

 
$
(13
)
 
Investment securities
 
Processing fees and other revenue


 
$
—

 
$
13

Foreign exchange contracts
Processing fees and other revenue

 
—

 
248

 
Foreign exchange deposit
 
Processing fees and other revenue


 
—

—

(248
)
Interest rate contracts
Net interest income
 
106

 
21

 
Available-for-sale securities(1)
 
Net interest income
 
(102
)
—

(21
)
Interest rate contracts
Net interest income
 
(3
)
 
(167
)
 
Long-term debt
 
Net interest income
 
4

—

156

Total
 
 
$
103


$
89

 
 
 
 
 
$
(98
)


$
(100
)
 
 
 
 
 
(1) In the first quarter of 2019, $2 million of net unrealized losses on AFS investment securities designated in fair value hedges was recognized in OCI compared to $18 million of net unrealized gains in the same period in 2018.
 
Three Months Ended March 31,
 
 
 
Three Months Ended March 31,
 
2019
 
2018
 
 
 
2019
 
2018
(In millions)
Amount of Gain or (Loss) Recognized in Other Comprehensive Income on Derivative
 
Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
 
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
Derivatives designated as cash flow hedges:
 
 
 
 
 
 
 
 
 
Interest rate contracts
$
10

 
$
(20
)
 
Net interest income
 
$
(2
)
 
$
1

Foreign exchange contracts
27

 
(88
)
 
Net interest income
 
7

 
7

Total derivatives designated as cash flow hedges
$
37

 
$
(108
)
 
 
 
$
5

 
$
8

 
 
 
 
 
 
 
 
 
 
Derivatives designated as net investment hedges:
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
$
20

 
$
(36
)
 
Gains (losses) related to investment securities, net
 
$
—

 
$
—

Total derivatives designated as net investment hedges
$
20

 
$
(36
)
 
 
 
$
—

 
$
—

 
 
 
 
 
 
 
 
 
 
Total
$
57

 
$
(144
)
 
 
 
$
5

 
$
8


Derivatives Netting and Credit Contingencies
Netting
Derivatives receivable and payable as well as cash collateral from the same counterparty are netted in the consolidated statement of condition for those counterparties with whom we have legally binding master netting agreements in place. In addition to cash collateral received and transferred presented on a net basis, we also receive and transfer collateral in the form of securities, which mitigate credit risk but are not eligible for netting. Additional information on netting is provided in Note 8.
Credit Contingencies
Certain of our derivatives are subject to master netting agreements with our derivative counterparties containing credit risk-related contingent features, which
 
requires us to maintain an investment grade credit rating with the various credit rating agencies. If our rating falls below investment grade, we would be in violation of the provisions, and counterparties to the derivatives could request immediate payment or demand full overnight collateralization on derivatives instruments in net liability positions. The aggregate fair value of all derivatives with credit contingent features and in a liability position as of March 31, 2019 totaled approximately $1.7 billion, against which we provided $1.0 billion of collateral in the normal course of business. If our credit related contingent features underlying these agreements were triggered as of March 31, 2019, the maximum additional collateral we would be required to post to our counterparties is approximately $0.7 billion.


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Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 8. Offsetting Arrangements
For additional information on our offsetting arrangements, refer to page 157 in Note 11 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
As of March 31, 2019 and December 31, 2018, the value of securities received as collateral from third parties where we are permitted to transfer or re-pledge
 
the securities totaled $11.74 billion and $11.69 billion, respectively, and the fair value of the portion that had been transferred or re-pledged as of the same dates was $7.99 billion and $5.31 million, respectively.
The following tables present information about the offsetting of assets related to derivative contracts and secured financing transactions, as of the dates indicated:
Assets:
 
March 31, 2019
 
 
Gross Amounts of Recognized
Assets(1)(2)
 
Gross Amounts Offset in Statement of Condition(3)
 
Net Amounts of Assets Presented in Statement of Condition
 
Gross Amounts Not Offset in Statement of Condition
(In millions)
 
 
 
 
Cash and Securities Received(4)
 
Net Amount(5)
Derivatives:
 
 
 
 
 
 
Foreign exchange contracts
 
$
11,144

 
$
(6,327
)
 
$
4,817

 
$
—

 
$
4,817

Cash collateral and securities netting
 
NA

 
(639
)
 
(639
)
 
(468
)
 
(1,107
)
Total derivatives
 
11,144

 
(6,966
)
 
4,178

 
(468
)
 
3,710

Other financial instruments:
 
 
 
 
 
 
Resale agreements and securities borrowing(6)
 
103,293

 
(77,842
)
 
25,451

 
(24,487
)
 
964

Total derivatives and other financial instruments
 
$
114,437

 
$
(84,808
)
 
$
29,629

 
$
(24,955
)
 
$
4,674



Assets:
 
December 31, 2018
 
 
Gross Amounts of Recognized
Assets(1)(2)
 
Gross Amounts Offset in Statement of Condition(3)
 
Net Amounts of Assets Presented in Statement of Condition
 
Gross Amounts Not Offset in Statement of Condition
(In millions)
 
 
 
 
Cash and Securities Received(4)
 
Net Amount(5)
Derivatives:
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
16,386

 
$
(10,223
)
 
$
6,163

 
$
—

 
$
6,163

Interest rate contracts(7)
 
13

 
—

 
13

 
—

 
13

Cash collateral and securities netting
 
NA

 
(987
)
 
(987
)
 
(220
)
 
(1,207
)
Total derivatives
 
16,399

 
(11,210
)
 
5,189

 
(220
)
 
4,969

Other financial instruments:
 
 
 
 
 
 
 
 
 
 
Resale agreements and securities borrowing(6)
 
116,143

 
(91,889
)
 
24,254

 
(22,872
)
 
1,382

Total derivatives and other financial instruments
 
$
132,542

 
$
(103,099
)
 
$
29,443

 
$
(23,092
)
 
$
6,351

 
 
 
 
 
(1) Amounts include all transactions regardless of whether or not they are subject to an enforceable netting arrangement.
(2) Refer to Note 1 and Note 2 for additional information about the measurement basis of derivative instruments.
(3) Amounts subject to netting arrangements which have been determined to be legally enforceable and eligible for netting in the consolidated statement of condition.
(4) Includes securities in connection with our securities borrowing transactions.
(5) Includes amounts secured by collateral not determined to be subject to enforceable netting arrangements.
(6) Included in the $25.45 billion as of March 31, 2019 were $1.52 billion of resale agreements and $23.93 billion of collateral provided related to securities borrowing. Included in the $24.25 billion as of December 31, 2018 were $4.68 billion of resale agreements and $19.58 billion of collateral provided related to securities borrowing. Resale agreements and collateral provided related to securities borrowing were recorded in securities purchased under resale agreements and other assets, respectively, in our consolidated statement of condition. Refer to Note 9 for additional information with respect to principal securities finance transactions.
(7) Variation margin payments presented as settlements rather than collateral.
NA Not applicable

State Street Corporation | 74

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following tables present information about the offsetting of liabilities related to derivative contracts and secured financing transactions, as of the dates indicated:
Liabilities:
 
March 31, 2019
 
 
Gross Amounts of Recognized Liabilities(1)(2)
 
Gross Amounts Offset in Statement of Condition(3)
 
Net Amounts of Liabilities Presented in Statement of Condition
 
Gross Amounts Not Offset in Statement of Condition
(In millions)
 
 
 
 
Cash and Securities Received(4)
 
Net Amount(5)
Derivatives:
 
 
 
 
 
 
Foreign exchange contracts
 
$
11,300

 
$
(6,327
)
 
$
4,973

 
$
—

 
$
4,973

Interest rate contracts(6)
 
69

 
—

 
69

 
—

 
69

Other derivative contracts
 
228

 
—

 
228

 
—

 
228

Cash collateral and securities netting
 
NA

 
(1,192
)
 
(1,192
)
 
(633
)
 
(1,825
)
Total derivatives
 
11,597

 
(7,519
)
 
4,078

 
(633
)
 
3,445

Other financial instruments:
 
 
 
 
 
 
Repurchase agreements and securities lending(7)
 
93,272

 
(77,842
)
 
15,430

 
(14,103
)
 
1,327

Total derivatives and other financial instruments
 
$
104,869

 
$
(85,361
)
 
$
19,508

 
$
(14,736
)
 
$
4,772


Liabilities:
 
December 31, 2018
 
 
Gross Amounts of Recognized Liabilities(1)(2)
 
Gross Amounts Offset in Statement of Condition(3)
 
Net Amounts of Liabilities Presented in Statement of Condition
 
Gross Amounts Not Offset in Statement of Condition
(In millions)
 
 
 
 
Cash and Securities Received(4)
 
Net Amount(5)
Derivatives:
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
16,522

 
$
(10,223
)
 
$
6,299

 
$
—

 
$
6,299

Interest rate contracts(6)
 
71

 
—

 
71

 
—

 
71

Other derivative contracts
 
214

 
—

 
214

 
—

 
214

Cash collateral and securities netting
 
NA

 
(1,341
)
 
(1,341
)
 
(215
)
 
(1,556
)
Total derivatives
 
16,807

 
(11,564
)
 
5,243

 
(215
)
 
5,028

Other financial instruments:
 
 
 
 
 
 
 
 
 
 
Repurchase agreements and securities lending(7)
 
104,494

 
(91,889
)
 
12,605

 
(11,543
)
 
1,062

Total derivatives and other financial instruments
 
$
121,301

 
$
(103,453
)
 
$
17,848

 
$
(11,758
)
 
$
6,090

 
 
 
 
 
(1) Amounts include all transactions regardless of whether or not they are subject to an enforceable netting arrangement.
(2) Refer to Note 1 and Note 2 for additional information about the measurement basis of derivative instruments.
(3) Amounts subject to netting arrangements which have been determined to be legally enforceable and eligible for netting in the consolidated statement of condition.
(4) Includes securities provided in connection with our securities lending transactions.
(5) Includes amounts secured by collateral not determined to be subject to enforceable netting arrangements.
(6) Variation margin payments presented as settlements rather than collateral.
(7) Included in the $15.43 billion as of March 31, 2019 were $1.42 billion of repurchase agreements and $14.01 billion of collateral received related to securities lending transactions. Included in the $12.60 billion as of December 31, 2018 were $1.08 billion of repurchase agreements and $11.52 billion of collateral received related to securities lending transactions. Repurchase agreements and collateral received related to securities lending were recorded in securities sold under repurchase agreements and accrued expenses and other liabilities, respectively, in our consolidated statement of condition. Refer to Note 9 for additional information with respect to principal securities finance transactions.
NA Not applicable
The securities transferred under resale and repurchase agreements typically are U.S. Treasury, agency and agency MBS. In our principal securities borrowing and lending arrangements, the securities transferred are predominantly equity securities and some corporate debt securities. The fair value of the securities transferred may increase in value to an amount greater than the amount received under our
 
repurchase and securities lending arrangements, which exposes us to counterparty risk. We require the review of the price of the underlying securities in relation to the carrying value of the repurchase agreements and securities lending arrangements on a daily basis and when appropriate, adjust the cash or security to be obtained or returned to counterparties that is reflective of the required collateral levels.

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Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following table summarizes our repurchase agreements and securities lending transactions by category of collateral pledged and remaining maturity of these agreements as of the periods indicated:
 
 
As of March 31, 2019
 
As of December 31, 2018
(In millions)
 
Overnight and Continuous
 
Up to 30 Days
 
Total
 
Overnight and Continuous
 
Up to 30 Days
 
Total
Repurchase agreements:
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency securities
 
$
74,346

 
$
—

 
$
74,346

 
$
88,904

 
$
—

 
$
88,904

Total
 
74,346

 
—

 
74,346

 
88,904

 
—

 
88,904

Securities lending transactions:
 
 
 
 
 
 
 
 
 
 
 
 
US Treasury and agency securities
 
136

 
—

 
136

 
249

 
—

 
249

Corporate debt securities
 
433

 
—

 
433

 
278

 
—

 
278

Equity securities
 
9,733

 
124

 
9,857

 
6,426

 
137

 
6,563

Other(1)
 
8,500

 
—

 
8,500

 
8,500

 
—

 
8,500

Total
 
18,802

 
124

 
18,926

 
15,453

 
137

 
15,590

Gross amount of recognized liabilities for repurchase agreements and securities lending
 
$
93,148

 
$
124

 
$
93,272

 
$
104,357

 
$
137

 
$
104,494

 
 
 
 
 
(1) Represents a security interest in underlying client assets related to our enhanced custody business, which assets clients have allowed us to transfer and re-pledge.
Note 9.    Commitments and Guarantees
For additional information on our commitments and guarantees, refer to page 160 in Note 12 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
The following table presents the aggregate gross contractual amounts of our off-balance sheet commitments and off-balance sheet guarantees as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Commitments:
 
 
 
Unfunded credit facilities(1)
$
29,951

 
$
28,951

Guarantees(2):
 
 
 
Indemnified securities financing
$
387,314

 
$
342,337

Standby letters of credit
2,973

 
2,985

 
 
(1) As of March 31, 2019, approximately 75% of our unfunded commitments to extend credit expire within one year.
(2)The potential losses associated with these guarantees equal the gross contractual amounts and do not consider the value of any collateral or reflect any participations to independent third parties.
Indemnified Securities Financing
For additional information on our Indemnified Securities Financing, refer to page 160 in Note 12 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
 
The following table summarizes the aggregate fair values of indemnified securities financing and related collateral, as well as collateral invested in indemnified repurchase agreements, as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Fair value of indemnified securities financing
$
387,314

 
$
342,337

Fair value of cash and securities held by us, as agent, as collateral for indemnified securities financing
405,299

 
357,893

Fair value of collateral for indemnified securities financing invested in indemnified repurchase agreements
47,560

 
42,610

Fair value of cash and securities held by us or our agents as collateral for investments in indemnified repurchase agreements
50,351

 
45,064


In certain cases, we participate in securities finance transactions as a principal. As a principal, we borrow securities from the lending client and then lend such securities to the subsequent borrower, either our client or a broker/dealer. Our right to receive and obligation to return collateral in connection with our securities lending transactions are recorded in other assets and other liabilities, respectively, in our consolidated statement of condition. As of March 31, 2019 and December 31, 2018, we had approximately $23.93 billion and $19.58 billion, respectively, of collateral provided and approximately $14.01 billion and $11.52 billion, respectively, of collateral received from clients in connection with our participation in principal securities finance transactions.

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Note 10.    Contingencies
Legal and Regulatory Matters
In the ordinary course of business, we and our subsidiaries are involved in disputes, litigation, and governmental or regulatory inquiries and investigations, both pending and threatened. These matters, if resolved adversely against us or settled, may result in monetary awards or payments, fines and penalties or require changes in our business practices. The resolution or settlement of these matters is inherently difficult to predict. Based on our assessment of these pending matters, we do not believe that the amount of any judgment, settlement or other action arising from any pending matter is likely to have a material adverse effect on our consolidated financial condition. However, an adverse outcome or development in certain of the matters described below could have a material adverse effect on our consolidated results of operations for the period in which such matter is resolved, or an accrual is determined to be required, on our consolidated financial condition, or on our reputation.
We evaluate our needs for accruals of loss contingencies related to legal and regulatory proceedings on a case-by-case basis. When we have a liability that we deem probable, and we deem the amount of such liability can be reasonably estimated as of the date of our consolidated financial statements, we accrue our estimate of the amount of loss. We also consider a loss probable and establish an accrual when we make, or intend to make, an offer of settlement. Once established, an accrual is subject to subsequent adjustment as a result of additional information. The resolution of legal and regulatory proceedings and the amount of reasonably estimable loss (or range thereof) are inherently difficult to predict, especially in the early stages of proceedings. Even if a loss is probable, an amount (or range) of loss might not be reasonably estimated until the later stages of the proceeding due to many factors such as the presence of complex or novel legal theories, the discretion of governmental authorities in seeking sanctions or negotiating resolutions in civil and criminal matters, the pace and timing of discovery and other assessments of facts and the procedural posture of the matter (collectively, "factors influencing reasonable estimates").
As of March 31, 2019, our aggregate accruals for loss contingencies for legal and regulatory matters totaled approximately $53 million. To the extent that we have established accruals in our consolidated statement of condition for probable loss contingencies, such accruals may not be sufficient to cover our ultimate financial exposure associated with any settlements or judgments. Any such ultimate financial exposure, or proceedings to which we may become subject in the future, could have a material adverse effect on our
 
businesses, on our future consolidated financial statements or on our reputation.
As of March 31, 2019, for those matters for which we have accrued probable loss contingencies (including the Invoicing Matter described below) and for other matters for which loss is reasonably possible (but not probable) in future periods, and for which we are able to estimate a range of reasonably possible loss, our estimate of the aggregate reasonably possible loss (in excess of any accrued amounts) ranges up to approximately $300 million. Our estimate with respect to the aggregate reasonably possible loss is based upon currently available information and is subject to significant judgment and a variety of assumptions and known and unknown uncertainties, which may change quickly and significantly from time to time, particularly if and as we engage with applicable governmental agencies or plaintiffs in connection with a proceeding. Also, the matters underlying the reasonably possible loss will change from time to time. As a result, actual results may vary significantly from the current estimate.
In certain pending matters, it is not currently feasible to reasonably estimate the amount or a range of reasonably possible loss, and such losses, which may be significant, are not included in the estimate of reasonably possible loss discussed above. This is due to, among other factors, the factors influencing reasonable estimates described above. An adverse outcome in one or more of the matters for which we have not estimated the amount or a range of reasonably possible loss, individually or in the aggregate, could have a material adverse effect on our businesses, on our future consolidated financial statements or on our reputation. Given that our actual losses from any legal or regulatory proceeding for which we have provided an estimate of the reasonably possible loss could significantly exceed such estimate, and given that we cannot estimate reasonably possible loss for all legal and regulatory proceedings as to which we may be subject now or in the future, no conclusion as to our ultimate exposure from current pending or potential legal or regulatory proceedings should be drawn from the current estimate of reasonably possible loss.
The following discussion provides information with respect to significant legal, governmental and regulatory matters.
Invoicing Matter
In 2015, we determined that we had incorrectly invoiced clients for certain expenses. We have reimbursed most of our affected customers for those expenses, and we have implemented enhancements to our billing processes. In connection with our enhancements to our billing processes, we continue to review historical billing practices and may from time to time identify additional remediation. In 2017, we identified an additional area of incorrect expense billing

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associated with mailing services in our retirement services business. The accrual for loss contingencies as of March 31, 2019 included an estimate of the amount we anticipate reimbursing clients due to that error. We currently expect the cumulative total of our payments to customers for these invoicing errors, including the error in the retirement services business, to be at least $380 million, all of which has been paid or is accrued. However, we may identify additional remediation costs.
In March 2017, a purported class action was commenced against us alleging that our invoicing practices violated duties owed to retirement plan customers under the Employee Retirement Income Security Act. In addition, we have received a purported class action demand letter alleging that our invoicing practices were unfair and deceptive under Massachusetts law. A class of customers, or particular customers, may assert that we have not paid to them all amounts incorrectly invoiced, and may seek double or treble damages under Massachusetts law.
We are also cooperating with investigations by governmental and regulatory authorities on these matters, including the civil and criminal divisions of the DOJ, the SEC, the Department of Labor and the Massachusetts Attorney General, which could result in significant fines or other sanctions, civil and criminal, against us. If these governmental or regulatory authorities were to conclude that all or a portion of the billing errors merited civil or criminal sanctions, any fine or other penalty could be a significant percentage, or a multiple of, the portion of the overcharging serving as the basis of such a claim or of the full amount overcharged. The governmental and regulatory authorities have significant discretion in civil and criminal matters as to the fines and other penalties they may seek to impose. The severity of such fines or other penalties could take into account factors such as the amount and duration of our incorrect invoicing, the government’s or regulator's assessment of the conduct of our employees, as well as prior conduct such as that which resulted in our January 2017 deferred prosecution agreement in connection with transition management services and our settlement of civil claims regarding our indirect FX business. The staff of the SEC has informed us that it intends to ask the SEC for permission to bring an action against us asserting that we overcharged clients that are registered investment companies for custody expenses in violation of §§ 31(a), 34(b) and 37 of the Investment Company Act of 1940, and Rules 31a-1(a) and 31a-1(b) thereunder. The Massachusetts Attorney General's office has also asserted a claim under state law. We have reached an agreement in principle with respect to the approximate financial terms of a settlement with each of the SEC and the Massachusetts Attorney General to resolve such claims and, at March 31, 2019, our aggregate accruals for loss contingencies for legal matters include the
 
amount of penalties reflected in such proposed settlements. There can be no assurance that any settlement, whether with the SEC or other governmental authorities, will be reached or, if so, the amount of the settlement or its impact on other claims relating to these matters. It is likely that discussions will commence in 2019 with the DOJ regarding a potential resolution of their investigation regarding this matter, which will then enable us to better assess the potential penalties and/or other sanctions they will be seeking. The aggregate amount of penalties that may potentially be imposed upon us in connection with the resolution of all outstanding investigations into our historical billing practices could be significant multiples of the potential penalties as to which we have reached an agreement in principle with the staff of the SEC.
The outcome of any of these proceedings and, in particular, any criminal sanction could materially adversely affect our results of operations and could have significant collateral consequences for our business and reputation.
Federal Reserve/Massachusetts Division of Banks Written Agreement
On June 1, 2015, we entered into a written agreement with the Federal Reserve and the Massachusetts Division of Banks relating to deficiencies identified in our compliance programs with the requirements of the Bank Secrecy Act, Anti-Money Laundering regulations and U.S. economic sanctions regulations promulgated by the Office of Foreign Assets Control. As part of this enforcement action, we have been required to, among other things, implement improvements to our compliance programs. If we fail to comply with the terms of the written agreement, we may become subject to fines and other regulatory sanctions, which may have a material adverse effect on us.
Shareholder Litigation
A shareholder of ours has filed a purported class action complaint against us alleging that our financial statements in our annual reports for the 2011-2014 period were misleading due to the inclusion of revenues associated with the invoicing matter referenced above and the facts surrounding our 2017 settlements with the U.S. government relating to our transition management business. The Court approved a class settlement in this matter for $4.9 million in April 2019.
Income Taxes
In determining our provision for income taxes, we make certain judgments and interpretations with respect to tax laws in jurisdictions in which we have business operations. Because of the complex nature of these laws, in the normal course of our business, we are subject to challenges from U.S. and non-U.S. income tax authorities regarding the amount of income taxes due. These challenges may result in adjustments to the timing or amount of taxable income or deductions

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or the allocation of taxable income among tax jurisdictions. We recognize a tax benefit when it is more likely than not that our position will result in a tax deduction or credit. Unrecognized tax benefits of approximately $103 million as of March 31, 2019 decreased from $108 million as of December 31, 2018.
We are presently under audit by a number of tax authorities, and the Internal Revenue Service is currently reviewing our U.S. income tax returns for the tax years 2014 and 2015. The earliest tax year open to examination in jurisdictions where we have material operations is 2012. Management believes that we have sufficiently accrued liabilities as of March 31, 2019 for potential tax exposures.
Note 11.    Variable Interest Entities
For additional information on our VIEs, refer to pages 163 to 164 in Note 14 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, "Variable Interest Entities", in our 2018 Form 10-K.
Tax Exempt Investment Program
In the normal course of our business, we structure and sell certificated interests in pools of tax exempt investment grade assets, principally to our mutual fund clients. We structure these pools as partnership trusts, and the assets and liabilities of the trusts are recorded in our consolidated statement of condition as AFS investment securities and other short term borrowings. As of March 31, 2019 and December 31, 2018, we carried AFS investment securities, composed of securities related to state and political subdivisions, with a fair value of $1.06 billion and $1.05 billion, respectively, and other short term borrowings of $0.93 billion in both periods, in our consolidated statement of condition in connection with these trusts. The interest income and interest expense generated by the investments and certificated interests, respectively, are recorded as components of NII when earned or incurred.
The trusts had a weighted average life of approximately 3.4 years and 3.6 years as of March 31, 2019 and December 31, 2018, respectively.
 
Interests in Investment Funds
As of March 31, 2019 and December 31, 2018, we did not have any consolidated investment funds. We managed certain funds, considered VIEs, in which we held a variable interest but for which we were not deemed to be the primary beneficiary. Our potential maximum loss exposure related to these unconsolidated funds totaled $37 million as of March 31, 2019 and $70 million as of December 31, 2018, and represented the carrying value of our investments, which are recorded in either AFS investment securities or other assets in our consolidated statement of condition. The amount of loss we may recognize during any period is limited to the carrying amount of our investments in the unconsolidated funds.

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Note 12.    Shareholders' Equity
Preferred Stock
The following table summarizes selected terms of each of the series of the preferred stock issued and outstanding as of March 31, 2019:
 
Issuance Date
 
Depositary Shares Issued
 
Ownership Interest Per Depositary Share
 
Liquidation Preference Per Share
 
Liquidation Preference Per Depositary Share
 
Net Proceeds of Offering
(In millions)
 
Redemption Date(1)
Preferred Stock(2):
 
 
 
 
 
 
 
 
 
 
 
 
Series C
August 2012
 
20,000,000

 
1/4,000th
 
$
100,000

 
$
25

 
$
488

 
September 15, 2017
Series D
February 2014
 
30,000,000

 
1/4,000th
 
100,000

 
25

 
742

 
March 15, 2024
Series E
November 2014
 
30,000,000

 
1/4,000th
 
100,000

 
25

 
728

 
December 15, 2019
Series F
May 2015
 
750,000

 
1/100th
 
100,000

 
1,000

 
742

 
September 15, 2020
Series G
April 2016
 
20,000,000

 
1/4,000th
 
100,000

 
25

 
493

 
March 15, 2026
Series H
September 2018
 
500,000

 
1/100th
 
100,000

 
1,000

 
494

 
December 15, 2023
 
 
 
 
(1) On the redemption date, or any dividend declaration date thereafter, the preferred stock and corresponding depositary shares may be redeemed by us, in whole or in part, at the liquidation price per share and liquidation price per depositary share plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
(2) The preferred stock and corresponding depositary shares may be redeemed at our option in whole, but not in part, prior to the redemption date upon the occurrence of a regulatory capital treatment event, as defined in the certificate of designation, at a redemption price equal to the liquidation price per share and liquidation price per depositary share plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
The following table presents the dividends declared for each of the series of preferred stock issued and outstanding for the periods indicated:
 
Three Months Ended March 31,
 
2019
 
2018
(Dollars in millions, except per share amounts)
Dividends Declared per Share
 
Dividends Declared per Depositary Share
 
Total(1)
 
Dividends Declared per Share
 
Dividends Declared per Depositary Share
 
Total
Preferred Stock:
 
 
 
 
 
 
 
 
 
 
 
Series C
$
1,313

 
$
0.33

 
$
6

 
$
1,313

 
$
0.33

 
$
6

Series D
1,475

 
0.37

 
11

 
1,475

 
0.37

 
11

Series E
1,500

 
0.38

 
11

 
1,500

 
0.38

 
11

Series F
2,625

 
26.25

 
20

 
2,625

 
26.25

 
20

Series G
1,338

 
0.33

 
7

 
1,338

 
0.33

 
7

Series H
—

 
—

 
—

 
—

 
—

 
—

Total
 
 
 
 
$
55

 
 
 
 
 
$
55

 
 
 
 
 
(1) Dividends were paid in March 2019
Common Stock
We repurchased $300 million of our common stock in the first quarter of 2019 and may repurchase up to $300 million of our common stock in the second quarter of 2019 under the 2018 Program.
The table below presents the activity under our common stock purchase program during the period indicated:
 
Three Months Ended March 31, 2019
 
Shares Acquired
(In millions)
 
Average Cost per Share
 
Total Acquired
(In millions)
2018 Program
4.2

 
$
70.93

 
$
300




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The table below presents the dividends declared on common stock for the periods indicated:
 
Three Months Ended March 31,
 
2019
 
2018
 
Dividends Declared per Share
 
Total
(In millions)
 
Dividends Declared per Share
 
Total
(In millions)
Common Stock
$
0.47

 
$
177

 
$
0.42

 
$
154


Accumulated Other Comprehensive Income (Loss)
The following table presents the after-tax components of AOCI as of the dates indicated:
(In millions)
March 31, 2019
 
December 31, 2018
Net unrealized (losses) on cash flow hedges
$
(71
)
 
$
(89
)
Net unrealized gains (losses) on available-for-sale securities portfolio
114

 
(193
)
Net unrealized gains related to reclassified available-for-sale securities
58

 
58

Net unrealized gains (losses) on available-for-sale securities
172

 
(135
)
Net unrealized (losses) on available-for-sale securities designated in fair value hedges
(56
)
 
(40
)
Net unrealized gains on hedges of net investments in non-U.S. subsidiaries
36

 
16

Other-than-temporary impairment on held-to-maturity securities related to factors other than credit
(3
)
 
(2
)
Net unrealized (losses) on retirement plans
(179
)
 
(143
)
Foreign currency translation
(1,079
)
 
(963
)
Total
$
(1,180
)
 
$
(1,356
)

The following table presents changes in AOCI by component, net of related taxes, for the periods indicated:
 
Three Months Ended March 31, 2019
(In millions)
Net Unrealized Gains (Losses) on Cash Flow Hedges
 
Net Unrealized Gains (Losses) on Available-for-Sale Securities
 
Net Unrealized Gains (Losses) on Hedges of Net Investments in Non-U.S. Subsidiaries
 
Other-Than-Temporary Impairment on Held-to-Maturity Securities
 
Net Unrealized Losses on Retirement Plans
 
Foreign Currency Translation
 
Total
Balance as of December 31, 2018
$
(89
)
 
$
(175
)
 
$
16

 
$
(2
)
 
$
(143
)
 
$
(963
)
 
$
(1,356
)
Other comprehensive income (loss) before reclassifications
24

 
270

 
23

 
1

 
—

 
(49
)
 
269

Reclassification of certain tax effects(1)
(6
)

21


(3
)

(1
)

(28
)

(67
)

(84
)
Amounts reclassified into (out of) earnings
—

 
—

 
—

 
(1
)
 
(8
)
 
—

 
(9
)
Other comprehensive income (loss)
18

 
291

 
20

 
(1
)
 
(36
)
 
(116
)
 
176

Balance as of March 31, 2019
$
(71
)
 
$
116

 
$
36

 
$
(3
)
 
$
(179
)
 
$
(1,079
)
 
$
(1,180
)

 
Three Months Ended March 31, 2018
(In millions)
Net Unrealized Gains (Losses) on Cash Flow Hedges
 
Net Unrealized Gains (Losses) on Available-for-Sale Securities
 
Net Unrealized Gains (Losses) on Hedges of Net Investments in Non-U.S. Subsidiaries
 
Other-Than-Temporary Impairment on Held-to-Maturity Securities
 
Net Unrealized Losses on Retirement Plans
 
Foreign Currency Translation
 
Total
Balance as of December 31, 2017
$
(56
)
 
$
103

 
$
(65
)
 
$
(6
)
 
$
(170
)
 
$
(815
)
 
$
(1,009
)
Other comprehensive income (loss) before reclassifications
(97
)
 
(130
)
 
(36
)
 
1

 
—

 
187

 
(75
)
Amounts reclassified into (out of) earnings
—

 
(1
)
 
—

 
(1
)
 
12

 
—

 
10

Other comprehensive income (loss)
(97
)
 
(131
)
 
(36
)
 
—

 
12

 
187

 
(65
)
Balance as of March 31, 2018
$
(153
)
 
$
(28
)
 
$
(101
)
 
$
(6
)
 
$
(158
)
 
$
(628
)
 
$
(1,074
)
 
 
 
 
 

(1) Represents the reclassification from accumulated other comprehensive income into retained earnings as a result of our adoption of ASU 2018-02 - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income in the first quarter of 2019.

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The following table presents after-tax reclassifications into earnings for the periods indicated:
 
Three Months Ended March 31,
 
 
 
2019
 
2018
 
 
(In millions)
Amounts Reclassified into
(out of) Earnings
 
Affected Line Item in Consolidated Statement of Income
Available-for-sale securities:
 
 
 
 
 
Net realized gains (losses) from sales of available-for-sale securities, net of related taxes of zero and ($1), respectively
$
—

 
$
(1
)
 
Net gains (losses) from sales of available-for-sale securities
Held-to-maturity securities:
 
 
 
 
 
Other-than-temporary impairment on held-to-maturity securities related to factors other than credit, net of related taxes of zero and zero, respectively
(1
)
 
(1
)
 
Losses reclassified (from) to other comprehensive income
Retirement plans:
 
 
 
 
 
Amortization of actuarial losses, net of related taxes of ($4) and $3, respectively
(8
)
 
12

 
Compensation and employee benefits expenses
Total reclassifications out of Accumulated other comprehensive loss
$
(9
)
 
$
10

 
 

Note 13.    Regulatory Capital
For additional information on our regulatory capital, including the regulatory capital requirements administered by federal banking agencies, and to which we are subject, refer to page 167 in Note 16 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
As of March 31, 2019, we and State Street Bank exceeded all regulatory capital adequacy requirements to which we were subject. As of March 31, 2019, State Street Bank was categorized as “well capitalized” under the applicable regulatory capital adequacy framework, and exceeded all “well capitalized” ratio guidelines to
 
which it was subject. Management believes that no conditions or events have occurred since March 31, 2019 that have changed the capital categorization of State Street Bank.
The following table presents the regulatory capital structure, total RWA, related regulatory capital ratios and the minimum required regulatory capital ratios for us and State Street Bank as of the dates indicated. As a result of changes in the methodologies used to calculate our regulatory capital ratios from period to period as the provisions of the Basel III final rule were phased in, the ratios presented in the table for each period-end are not directly comparable. Refer to the footnotes following the table.

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(UNAUDITED)

 
State Street
 
State Street Bank
(Dollars in millions)
Basel III Advanced Approaches March 31, 2019
 
Basel III Standardized Approach March 31, 2019
 
Basel III Advanced Approaches December 31, 2018(1)
 
Basel III Standardized Approach December 31, 2018(1)
 
Basel III Advanced Approaches March 31, 2019
 
Basel III Standardized Approach March 31, 2019
 
Basel III Advanced Approaches December 31, 2018(1)
 
Basel III Standardized Approach December 31, 2018(1)
 Common shareholders' equity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock and related surplus
$
10,586

 
$
10,586

 
$
10,565

 
$
10,565

 
$
12,894

 
$
12,894

 
$
12,894

 
$
12,894

Retained earnings
20,911

 
20,911

 
20,606

 
20,606

 
14,273

 
14,273

 
14,261

 
14,261

Accumulated other comprehensive income (loss)
(1,168
)
 
(1,168
)
 
(1,332
)
 
(1,332
)
 
(954
)
 
(954
)
 
(1,112
)
 
(1,112
)
Treasury stock, at cost
(8,969
)
 
(8,969
)
 
(8,715
)
 
(8,715
)
 
—

 
—

 
—

 
—

Total
21,360


21,360

 
21,124

 
21,124

 
26,213

 
26,213

 
26,043

 
26,043

Regulatory capital adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill and other intangible assets, net of associated deferred tax liabilities
(9,294
)
 
(9,294
)
 
(9,350
)
 
(9,350
)
 
(9,016
)
 
(9,016
)
 
(9,073
)
 
(9,073
)
Other adjustments(2)
(167
)
 
(167
)
 
(194
)
 
(194
)
 
(1
)
 
(1
)
 
(29
)
 
(29
)
 Common equity tier 1 capital
11,899


11,899

 
11,580

 
11,580

 
17,196

 
17,196

 
16,941

 
16,941

Preferred stock
3,690

 
3,690

 
3,690

 
3,690

 
—

 
—

 
—

 
—

 Tier 1 capital
15,589


15,589

 
15,270

 
15,270

 
17,196

 
17,196

 
16,941

 
16,941

Qualifying subordinated long-term debt
787

 
787

 
778

 
778

 
785

 
785

 
776

 
776

Allowance for loan and lease losses and other
10

 
84

 
14

 
83

 
6

 
83

 
11

 
83

 Total capital
$
16,386


$
16,460

 
$
16,062

 
$
16,131

 
$
17,987

 
$
18,064

 
$
17,728

 
$
17,800

 Risk-weighted assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit risk(3)
$
49,451

 
$
102,284

 
$
47,738

 
$
97,303

 
$
47,106

 
$
99,673

 
$
45,565

 
$
94,776

Operational risk(4)
47,213

 
NA

 
46,060

 
NA

 
44,416

 
NA

 
44,494

 
NA

Market risk
1,359

 
1,359

 
1,517

 
1,517

 
1,359

 
1,359

 
1,517

 
1,517

Total risk-weighted assets
$
98,023

 
$
103,643

 
$
95,315

 
$
98,820

 
$
92,881

 
$
101,032

 
$
91,576

 
$
96,293

Adjusted quarterly average assets
$
210,099

 
$
210,099

 
$
211,924

 
$
211,924

 
$
207,417

 
$
207,417

 
$
209,413

 
$
209,413

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capital Ratios:
2019 Minimum Requirements Including Capital Conservation Buffer and G-SIB Surcharge(5)
2018 Minimum Requirements Including Capital Conservation Buffer and G-SIB Surcharge(6)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common equity tier 1 capital
8.5
%
7.5
%
12.1
%
 
11.5
%
 
12.1
%
 
11.7
%
 
18.5
%
 
17.0
%
 
18.5
%
 
17.6
%
Tier 1 capital
10.0

9.0

15.9

 
15.0

 
16.0

 
15.5

 
18.5

 
17.0

 
18.5

 
17.6

Total capital
12.0

11.0

16.7

 
15.9

 
16.9

 
16.3

 
19.4

 
17.9

 
19.4

 
18.5

 
 

(1)  Under the applicable bank regulatory rules, we are not required to and, accordingly, did not revise previously-filed reported capital metrics and ratios following the change in accounting for LIHTC.
(2) Other adjustments within CET1 primarily include the overfunded portion of the firm’s defined benefit pension plan obligation net of associated deferred tax liabilities, disallowed deferred tax assets, and other required credit risk based deductions.
(3) Includes a CVA which reflects the risk of potential fair value adjustments for credit risk reflected in our valuation of OTC derivative contracts. We used a simple CVA approach in conformity with the Basel III advanced approaches.
(4)  Under the current advanced approaches rules and regulatory guidance concerning operational risk models, RWA attributable to operational risk can vary substantially from period-to-period, without direct correlation to the effects of a particular loss event on our results of operations and financial condition and impacting dates and periods that may differ from the dates and periods as of and during which the loss event is reflected in our financial statements, with the timing and categorization dependent on the processes for model updates and, if applicable, model revalidation and regulatory review and related supervisory processes. An individual loss event can have a significant effect on the output of our operational RWA under the advanced approaches depending on the severity of the loss event and its categorization among the seven Basel-defined UOMs.
(5) Minimum requirements were phased in with full implementation beginning on January 1, 2019; minimum requirements listed are as of March 31, 2019.
(6) Minimum requirements were phased in with full implementation beginning on January 1, 2019; minimum requirements listed are as of December 31, 2018.
NA Not applicable


State Street Corporation | 83

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 14.    Net Interest Income
The following table presents the components of interest income and interest expense, and related NII, for the periods indicated:
 
Three Months Ended March 31,
(In millions)
2019
 
2018(1)
Interest income:
 
 
 
Interest-bearing deposits with banks
$
119

 
$
82

Investment securities:
 
 
 
U.S. Treasury and federal agencies
369

 
255

State and political subdivisions
12

 
52

Other investments
122

 
159

Securities purchased under resale agreements
98

 
77

Loans and leases
198

 
155

Other interest-earning assets
109

 
77

Total interest income
1,027

 
857

Interest expense:
 
 
 
Interest-bearing deposits
171

 
63

Securities sold under repurchase agreements
12

 
—

Other short-term borrowings
4

 
3

Long-term debt
106

 
97

Other interest-bearing liabilities
61

 
51

Total interest expense
354

 
214

Net interest income
$
673

 
$
643


 
 
(1)In the first quarter of 2018, approximately $15 million of swap costs were reclassified from processing fees and other revenue within fee revenue to net interest income to conform to current presentation.
Note 15.    Expenses
The following table presents the components of other expenses for the periods indicated:
 
Three Months Ended March 31,
(In millions)
2019
 
2018
Professional services
$
80

 
$
79

Sales advertising public relations
27

 
26

Insurance
22

 
32

Regulatory fees and assessments
18

 
27

Bank operations
11

 
17

Other
117

 
99

Total other expenses
$
275

 
$
280


Acquisition Costs
We recorded $13 million of acquisition costs in the first quarter of 2019 primarily related to our acquisition of CRD. As we integrate CRD into our business, we expect to incur approximately $200 million of acquisition costs, including merger and integration costs, through 2021.
 
Restructuring and Repositioning Charges
Repositioning Charges
In 2018, we initiated a new expense program to accelerate efforts to become a higher-performing organization and help navigate challenging market and industry conditions.
Beacon
In the first quarter of 2019, we released $4 million of restructuring accruals related to Beacon. We recorded no restructuring charges in the same period in 2018.
The following table presents aggregate activity for the periods indicated:
(In millions)
Employee
Related Costs
 
Real Estate
Actions
 
Asset and Other Write-offs
 
Total
Accrual balance at December 31, 2017
$
166


$
32


$
3


$
201

Accruals for Beacon
—

 
—

 
—

 
—

Payments and other adjustments
(22
)
 
(4
)
 
—

 
(26
)
Accrual balance at March 31, 2018
$
144


$
28


$
3


$
175

Accrual balance at December 31, 2018
$
303

 
$
37

 
$
1

 
341

Accruals for Beacon
(4
)
 
—

 
—

 
(4
)
Payments and other adjustments
(53
)
 
(25
)
 
—

 
(78
)
Accrual balance at March 31, 2019
$
246

 
$
12

 
$
1

 
$
259


Note 16. Occupancy Expense and Information Systems and Communications Expense
Upon adoption of Topic 842 on January 1, 2019, we recognized right-of-use assets of approximately $0.91 billion and lease liabilities of approximately $1.06 billion.
Occupancy expense and information systems and communications expense include depreciation of buildings, leasehold improvements, computer hardware and software, equipment, furniture and fixtures, and amortization of lease right-of-use assets. Total depreciation and amortization was $205 million in the first quarter of 2019.
We use our incremental borrowing rate to determine the present value of the lease payments for finance and operating leases described below. Additionally, we do not separate nonlease components such as real estate taxes and common area maintenance from base lease payments.
As of March 31, 2019, an aggregate net book value of $94 million for the finance lease related to our One Lincoln Street Boston headquarters is recorded in premises and equipment, with the related lease liability of $160 million recorded in long-term debt, in our consolidated statement of condition.
Finance lease right-of-use asset amortization is recorded in occupancy expense on a straight-line basis in our consolidated statement of income over the

State Street Corporation | 84

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

respective lease term. Lease payments are recorded as a reduction of the liability, with a portion recorded as imputed interest expense. In the quarter ended March 31, 2019, interest expense related to the finance lease obligation reflected in NII was $3 million. As of March 31, 2019, accumulated amortization of the finance lease right-of-use asset was $40 million.
Operating lease right-of-use assets with an aggregate net book value of $899 million are recorded in other assets, with the related lease liability of $1.06 billion recorded in accrued expenses and other liabilities in our consolidated statement of condition.
We have entered into non-cancellable operating leases for premises and equipment. Nearly all of these leases include renewal options, and only those reasonably certain of being exercised are included in the term of the lease. Costs for operating leases are recorded on a straight-line basis which includes both interest expense and right-of-use asset amortization. Operating lease costs for office space are recorded in occupancy expense. Costs related to operating leases for equipment are recorded in information systems and communications expense.
As of March 31, 2019, we have additional operating leases, primarily for office space, that have not yet commenced of approximately $497 million of undiscounted future minimum lease payments. These leases will commence between fiscal year 2019 and fiscal year 2023 with lease terms of 11 to 15 years. The majority of these future payments relate to the new Boston headquarters lease executed in the first quarter of 2019, replacing the One Lincoln Street Boston property.
None of our leases contain residual value guarantees.
The following table presents lease costs, sublease rental income, cash flows and new leases arising from lease transactions for the quarter ended March 31, 2019:
 
(In millions)
Three Months Ended March 31, 2019
Finance lease:
 
     Amortization of right-of-use assets
$
5

     Interest on lease liabilities
3

Total finance lease expense
8

     Sublease income
(2
)
Net finance lease expense
6

Operating lease:
 
     Operating lease expense
44

     Sublease income
(1
)
Net operating lease expense
43

Net lease expense
$
49

 
 
Cash paid for amounts included in the measurement of lease liabilities:
     Operating cash flows from finance leases
$
3

     Operating cash flows from operating leases
51

     Financing cash flows from finance leases
31

Right-of-use assets obtained in exchange for new lease obligations:
     Operating leases
$
29

     Finance leases
—


The following table presents future minimum lease payments under non-cancellable leases as of March 31, 2019:
(In millions)
Operating Leases
 
Finance Leases
 
Total
2019 (excluding the first quarter of 2019)
$
144

 
$
31

 
$
175

2020
185

 
42

 
227

2021
174

 
42

 
216

2022
151

 
42

 
193

2023
131

 
30

 
161

Thereafter
400

 
—

 
400

Total future minimum lease payments
1,185

 
187

 
1,372

Less imputed interest
(125
)
 
(27
)
 
(152
)
     Total
$
1,060

 
$
160

 
$
1,220


The following table presents details related to remaining lease terms and discount rate for the quarter ended March 31, 2019:
 
Three Months Ended March 31, 2019
Weighted-average remaining lease term (in years):
     Finance leases
4.5

     Operating leases
7.8

Weighted-average discount rate:
     Finance leases
7
%
     Operating leases
3



State Street Corporation | 85

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 17. Earnings Per Common Share
For additional information on our earnings per share calculation methodologies, refer to page 175 in Note 23 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
The following table presents the computation of basic and diluted earnings per common share for the periods indicated:
 
Three Months Ended March 31,
(Dollars in millions, except per share amounts)
2019

2018
Net income
$
508

 
$
659

Less:
 
 
 
Preferred stock dividends
(55
)
 
(55
)
Dividends and undistributed earnings allocated to participating securities(1)
(1
)
 
(1
)
Net income available to common shareholders
$
452

 
$
603

Average common shares outstanding (In thousands):
 
 
 
Basic average common shares
377,915

 
367,439

Effect of dilutive securities: equity-based awards
3,788

 
5,180

Diluted average common shares
381,703

 
372,619

Anti-dilutive securities(2)
1,951

 
—

Earnings per common share:
 
 
 
Basic
$
1.20

 
$
1.64

Diluted(3)
1.18

 
1.62

 
 

(1) Represents the portion of net income available to common equity allocated to participating securities, composed of unvested and fully vested SERP (Supplemental executive retirement plans) shares and fully vested deferred director stock awards, which are equity-based awards that contain non-forfeitable rights to dividends, and are considered to participate with the common stock in undistributed earnings.
(2) Represents equity-based awards outstanding but not included in the computation of diluted average common shares, because their effect was anti-dilutive. Additional information about equity-based awards is provided on pages 169 to 171 in Note 18 to the consolidated financial statements in our 2018 Form 10-K.
(3) Calculations reflect allocation of earnings to participating securities using the two-class method, as this computation is more dilutive than the treasury stock method.
Note 18.    Line of Business Information
Our operations are organized into two lines of business: Investment Servicing and Investment Management, which are defined based on products and services provided. The results of operations for these lines of business are not necessarily comparable with those of other companies, including companies in the financial services industry. For information about our two lines of business, as well as revenues, expenses and capital allocation methodologies associated with them, refer to pages 175 to 176 in Note 24 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
The following is a summary of our line of business results for the periods indicated. The "Other" columns represent costs incurred that are not allocated to a specific line of business, including certain severance and restructuring costs, acquisition costs and certain provisions for legal contingencies.
 
Three Months Ended March 31,
 
Investment
Servicing
 
Investment
Management
 
Other
 
Total
(Dollars in millions)
2019
 
2018
 
2019
 
2018
 
2019
 
2018
 
2019
 
2018
Servicing fees
$
1,251

 
$
1,421

 
$
—

 
$
—

 
$
—

 
$
—

 
$
1,251

 
$
1,421

Management fees
—

 
—

 
420

 
472

 
—

 
—

 
420

 
472

Foreign exchange trading services
246

 
274

 
34

 
30

 
—

 
—

 
280

 
304

Securities finance
117

 
141

 
1

 
—

 
—

 
—

 
118

 
141

Processing fees and other
180

 
77

 
11

 
—

 
—

 
—

 
191

 
77

Total fee revenue
1,794

 
1,913

 
466

 
502

 
—

 
—

 
2,260

 
2,415

Net interest income
679

 
648

 
(6
)
 
(5
)
 
—

 
—

 
673

 
643

Gains (losses) related to investment securities, net
(1
)
 
(2
)
 
—

 
—

 
—

 
—

 
(1
)
 
(2
)
Total revenue
2,472

 
2,559

 
460

 
497

 
—

 
—

 
2,932

 
3,056

Total expenses
1,864

 
1,870

 
406

 
398

 
23

 
—

 
2,293

 
2,268

Income before income tax expense
$
604

 
$
689

 
$
54

 
$
99

 
$
(23
)
 
$
—

 
$
635

 
$
788

Pre-tax margin
24
%
 
27
%
 
12
%
 
20
%
 
 
 
 
 
22
%
 
26
%


State Street Corporation | 86

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 19.  Revenue from Contracts with Customers
For additional information on our revenue from contracts with customers, including revenues associated with both our Investment Servicing and Investment Management lines of business, refer to pages 177 to 178 in Note 25 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2018 Form 10-K.
Revenue by category
In the following table, revenue is disaggregated by our two lines of business and by revenue stream for which the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
 
 
Three Months Ended March 31, 2019
 
 
Investment Servicing
 
Investment Management
 
Total
(Dollars in millions)
 
Topic 606 revenue
 
All other revenue
 
Total
 
Topic 606 revenue
 
All other revenue
 
Total
 
2019
Servicing fees
 
$
1,251

 
$
—

 
$
1,251

 
$
—

 
$
—

 
$
—

 
$
1,251

Management fees
 
—

 
—

 
—

 
420

 
—

 
420

 
420

Foreign exchange trading services
 
86

 
160

 
246

 
34

 
—

 
34

 
280

Securities finance
 
70

 
47

 
117

 
—

 
1

 
1

 
118

Processing fees and other
 
116

 
64

 
180

 
—

 
11

 
11

 
191

Total fee revenue
 
1,523

 
271

 
1,794

 
454

 
12

 
466

 
2,260

Net interest income
 
—

 
679

 
679

 
—

 
(6
)
 
(6
)
 
673

Gains (losses) related to investment securities, net
 
—

 
(1
)
 
(1
)
 
—

 
—

 
—

 
(1
)
Total revenue
 
$
1,523

 
$
949

 
$
2,472

 
$
454

 
$
6

 
$
460

 
$
2,932

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended March 31, 2018
 
 
Investment Servicing
 
Investment Management
 
Total
(Dollars in millions)
 
Topic 606 revenue
 
All other revenue
 
Total
 
Topic 606 revenue
 
All other revenue
 
Total
 
2018
Servicing fees
 
$
1,421

 
$
—

 
$
1,421

 
$
—

 
$
—

 
$
—

 
$
1,421

Management fees
 
—

 
—

 
—

 
472

 
—

 
472

 
472

Foreign exchange trading services
 
95

 
179

 
274

 
30

 
—

 
30

 
304

Securities finance
 
77

 
64

 
141

 
—

 
—

 
—

 
141

Processing fees and other(1)
 
19

 
58

 
77

 
—

 
—

 
—

 
77

Total fee revenue
 
1,612

 
301

 
1,913

 
502

 
—

 
502

 
2,415

Net interest income(1)
 
—

 
648

 
648

 
—

 
(5
)
 
(5
)
 
643

Gains (losses) related to investment securities, net
 
—

 
(2
)
 
(2
)
 
—

 
—

 
—

 
(2
)
Total revenue
 
$
1,612

 
$
947

 
$
2,559

 
$
502

 
$
(5
)
 
$
497

 
$
3,056

 
 
 
 
 
1) In the first quarter of 2018, approximately $15 million of swap costs were reclassified from processing fees and other revenue within fee revenue to net interest income to conform to current presentation.
Contract balances and contract costs
As of March 31, 2019 and December 31, 2018, net receivables of $2.80 billion and $2.75 billion, respectively, are included in accrued interest and fees receivable, representing amounts billed or currently billable to or due from our customers related to revenue from contracts with customers. As performance obligations are satisfied, we have an unconditional right to payment and billing is generally performed monthly; therefore, we do not have significant contract assets or liabilities.
No adjustments are made to the promised amount of consideration for the effects of a significant financing component as the period between when we transfer a promised service to a customer and when the customer pays for that service is expected to be one year or less.

State Street Corporation | 87

Table of ContentsSTATE STREET CORPORATION
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 20.    Non-U.S. Activities
We define our non-U.S. activities as those revenue-producing business activities that arise from clients which are generally serviced or managed outside the U.S. Due to the integrated nature of our business, precise segregation of our U.S. and non-U.S. activities is not possible.
Subjective estimates, assumptions and other judgments are applied to quantify the financial results and assets related to our non-U.S. activities, including our application of funds transfer pricing, our asset and liability management policies and our allocation of certain indirect corporate expenses. Management periodically reviews and updates its processes for quantifying the financial results and assets related to our non-U.S. activities.
The following table presents our U.S. and non-U.S. financial results for the periods indicated:
 
Three Months Ended March 31,
 
2019
 
2018
(In millions)
Non-U.S.(1)
 
U.S.
 
Total
 
Non-U.S.(1)
 
U.S.
 
Total
Total revenue
$
1,231

 
$
1,701

 
$
2,932

 
$
1,321

 
$
1,735

 
$
3,056

Income before income tax expense
249

 
386

 
635

 
395

 
393

 
788

 
 
 
 
 
(1) Geographic mix is generally based on the domicile of the entity servicing the funds and is not necessarily representative of the underlying asset mix.
Non-U.S. assets were $77.73 billion and $78.49 billion as of March 31, 2019 and 2018, respectively.

State Street Corporation | 88



Report of Ernst & Young LLP, Independent Registered Public Accounting Firm

The Shareholders and Board of Directors of State Street Corporation
Results of Review of Interim Financial Statements
We have reviewed the accompanying consolidated statement of condition of State Street Corporation (the “Corporation”) as of March 31, 2019, and the related consolidated statements of income and comprehensive income, changes in shareholders’ equity and cash flows for the three-month periods ended March 31, 2019 and 2018, and the related condensed notes (collectively referred to as the “condensed consolidated interim financial statements”). Based on our reviews, we are not aware of any material modifications that should be made to the condensed consolidated interim financial statements for them to be in conformity with U.S. generally accepted accounting principles.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the consolidated statement of condition of the Corporation as of December 31, 2018, the related consolidated statements of income, comprehensive income, changes in shareholders' equity and cash flows for the year then ended, and the related notes (not presented herein); and in our report dated February 21, 2019, we expressed an unqualified audit opinion on those consolidated financial statements. As described in Note 1 to the Corporation’s unaudited interim condensed consolidated financial statements, the Corporation elected to change its method of accounting for investments in low income housing tax credits from the equity method of accounting to the proportional amortization method of accounting effective January 1, 2019 and applied the change on a retrospective basis resulting in revision of the December 31, 2018 consolidated statement of condition. We have not audited and reported on the revised statement of condition reflecting the adoption of the proportional amortization method of accounting.
Basis for Review Results
These financial statements are the responsibility of the Corporation’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Corporation in accordance with the U.S. federal securities laws and the applicable rules and regulations of the SEC and the PCAOB. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial statements consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.



/s/ Ernst & Young LLP
Boston, Massachusetts
May 1, 2019


State Street Corporation | 89


ACRONYMS
 
 
 
 
ABS
Asset-backed securities
G-SIB
Global systemically important bank
AFS
Available-for-sale
HQLA
High-quality liquid assets
ALLL
Allowance for loans and leases losses
HTM
Held-to-maturity
AOCI
Accumulated other comprehensive income (loss)
LCR
Liquidity coverage ratio
ASU
Accounting Standards Update
LIHTC
Low income housing tax credits
AUC/A
Assets under custody and/or administration
LTD
Long-term debt
AUM
Assets under management
MBS
Mortgage-backed securities
bps
Basis points
NII
Net interest income
CET1
Common equity tier 1
NIM
Net interest margin
CMO
Collateralized mortgage obligations
OCI
Other comprehensive income (loss)
CVA
Credit valuation adjustment
OTTI
Other-than-temporary-impairment
DOJ
Department of Justice
PCAOB
Public Company Accounting Oversight Board
EPS
Earnings per share
RWA(1)
Risk-weighted assets
ETF
Exchange-traded fund
SEC
Securities and Exchange Commission
EVE
Economic value of equity
SLR
Supplementary leverage ratio
FDIC
Federal Deposit Insurance Corporation
SPDR
Spider; Standard and Poor's depository receipt
FHLB
Federal Home Loan Bank of Boston
SPOE Strategy
Single Point of Entry Strategy
FTE
Fully taxable-equivalent
TLAC
Total loss-absorbing capacity
FX
Foreign exchange
UOM
Unit of measure
GAAP
Generally accepted accounting principles
VaR
Value-at-Risk
 
 
 
 
(1) As defined by the applicable U.S. regulations.


State Street Corporation | 90


GLOSSARY
 
 
 
 
2018 Form 10-K: State Street Corporation Form 10-K for the year ended December 31, 2018.

Asset-backed securities: A financial security backed by collateralized assets, other than real estate or mortgage backed securities.

Assets under custody and/or administration: Assets that we hold directly or indirectly on behalf of clients under a safekeeping or custody arrangement or for which we provide administrative services for clients. To the extent that we provide more than one AUC/A service for a client’s assets, the value of the asset is only counted once in the total amount of AUC/A.

Assets under management: The total market value of client assets for which we provide investment management strategy services, advisory services and/or distribution services generating management fees based on a percentage of the assets’ market values. These client assets are not included on our balance sheet.

Beacon: A multi-year program, announced in October 2015, to create cost efficiencies through changes in our operational processes and to further digitize our processes and interfaces with our clients.

Certificates of deposit: A savings certificate with a fixed maturity date, specified fixed interest rate and can be issued in any denomination aside from minimum investment requirements. A CD restricts access to the funds until the maturity date of the investment.

Collateralized loan obligations: A security backed by a pool of debt, primarily senior secured leveraged loans. CLOs are similar to collateralized mortgage obligations, except for the different type of underlying loan. With a CLO, the investor receives scheduled debt payments from the underlying loans, assuming most of the risk in the event borrowers default, but is offered greater diversity and the potential for higher-than-average returns.

Commercial real estate: Property intended to generate profit from capital gains or rental income. CRE loans are term loans secured by commercial and multifamily properties. We seek CRE loans with strong competitive positions in major domestic markets, stable cash flows, modest leverage and experienced institutional ownership.

Deposit beta: A measure of how much of an interest rate increase is expected to be passed on to client interest-bearing accounts, on average.

Depot bank: A German term, specified by the country's law on investment companies, which essentially corresponds to 'custodian'.

Doubtful: Doubtful loans and leases meet the same definition of substandard loans and leases (i.e., well-defined weaknesses that jeopardize repayment with the possibility that we will sustain some loss) with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable.

Economic value of equity: A measure designed to estimate the fair value of assets, liabilities and off-balance sheet instruments based on a discounted cash flow model.

Exchange-Traded Fund: A type of exchange-traded investment product that offer investors a way to pool their money in a fund that makes investments in stocks, bonds, or other assets and, in return, to receive an interest in that investment pool. ETF shares are traded on a national stock exchange and at market prices that may or may not be the same as the net asset value.

Exposure-at-default: A measure used in the calculation of regulatory capital under Basel III. It can be defined as the expected amount of loss a bank may be exposed to upon default of an obligor.

Global systemically important bank: A financial institution whose distress or disorderly failure, because of its size, complexity and systemic interconnectedness, would cause significant disruption to the wider financial system and economic activity, which will be subject to additional capital requirements.

Held-to-maturity investment securities: We classify investments in debt securities as held-to-maturity only if we have the positive intent and ability to hold those securities to maturity. Investments in debt securities classified as held-to-maturity are measured subsequently at amortized cost in the statement of financial position.

High-quality liquid assets: Cash or assets that can be converted into cash at little or no loss of value in private markets and are considered unencumbered.

Investment grade: A rating of loans and leases to counterparties with strong credit quality and low expected credit risk and probability of default. It applies to counterparties with a strong capacity to support the timely repayment of any financial commitment.

Liquidity coverage ratio: The ratio of encumbered high-quality liquid assets divided by expected total net cash outflows over a 30-day stress period. A Basel III framework requirement for banks and bank holding companies to measure liquidity, it is designed to ensure that certain banking institutions, including us, maintain a minimum amount of unencumbered HQLA sufficient to withstand the net cash outflow under a hypothetical standardized acute liquidity stress scenario for a 30-day stress period.

Net asset value: The amount of net assets attributable to each share/unit of the fund at a specific date or time.

Net stable funding ratio: The ratio of the amount of available stable funding relative to the amount of required stable funding. This ratio should be equal to at least 100% on an ongoing basis.

Other-than-temporary-impairment: Impairment charge taken on a security whose fair value has fallen below its carrying value on balance sheet and its value is not expected to recover through the holding period of the security.

Probability of default: A measure of the likelihood that a credit obligor will enter into default status.

Qualified financial contracts: Securities contracts, commodity contracts, forward contracts, repurchase agreements, swap agreements and any other contract determined by the FDIC to be a qualified financial contract.

Risk-weighted assets: A measurement used to quantify risk inherent in our on and off-balance sheet assets by adjusting the asset value for risk. RWA is used in the calculation of our risk-based capital ratios.

Special mention: Loans and leases that consist of counterparties with potential weaknesses that, if uncorrected, may result in deterioration of repayment prospects.

Speculative: Loans and leases that consist of counterparties that face ongoing uncertainties or exposure to business, financial, or economic downturns. However, these counterparties may have financial flexibility or access to financial alternatives, which allow for financial commitments to be met.

Substandard: Loans and leases that consist of counterparties with well-defined weakness that jeopardizes repayment with the possibility we will sustain some loss.

Supplementary leverage ratio: The ratio of our tier 1 capital to our total leverage exposure, which measures our capital adequacy relative to our on and off-balance sheet assets.

Total loss-absorbing capacity: The sum of our tier 1 regulatory capital plus eligible external long-term debt issued by us.

Value-at-Risk: Statistical model used to measure the potential loss in value of a portfolio that could occur in normal markets condition, over a defined holding period, within a certain confidence level.

Variable interest entity: An entity that: (1) lacks enough equity investment at risk to permit the entity to finance its activities without additional financial support from other parties; (2) has equity owners that lack the right to make significant decisions affecting the entity’s operations; and/or (3) has equity owners that do not have an obligation to absorb or the right to receive the entity’s losses or return.













State Street Corporation | 91



PART II. OTHER INFORMATION
ITEM 2.     UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
In June 2018, our Board approved a common stock purchase program authorizing the purchase of up to $1.2 billion of our common stock through June 30, 2019 (the 2018 Program).
Stock purchases may be made using various types of mechanisms, including open market purchases, accelerated share repurchases or transactions off market, and may be made under Rule 10b5-1 trading programs. The timing of stock purchases, types of transactions and number of shares purchased will depend on several factors, including market conditions and State Street’s capital positions, financial
 
performance and investment opportunities. Our common stock purchase programs do not have specific price targets and may be suspended at any time. We may employ third-party broker/dealers to acquire shares on the open market in connection with our common stock purchase programs. We repurchased $300 million shares in the first quarter of 2019 and may repurchase up to $300 million in the second quarter of 2019 under the 2018 Program.
The following table presents purchases of our common stock under the 2018 Program and related information for each of the months in the quarter ended March 31, 2019.

 
Total Number of Shares Purchased (In thousands)
 
Average Price Paid Per Share
 
Total Number of Shares Purchased as Part of Publicly Announced Program (In thousands)
 
Approximate Dollar Value of Shares That May Yet be Purchased Under Publicly Announced Program (In millions)
Period:
 
 
 
 
 
 
 
January 1 - January 31, 2019
1,297

 
$
71.34

 
1,297

 
$
508

February 1 - February 28, 2019
2,933

 
70.74

 
2,933

 
300

March 1 - March 31, 2019
—

 
—

 
—

 
300

Total
4,230

 
$
70.93

 
4,230

 
$
300



State Street Corporation | 92



ITEM 6.    EXHIBITS
Exhibit No.
 
Exhibit Description
 
 
 
 
 

 
 
 
 
 
 

 

 
 
 
 
 

 

 
 
 
 
 

 

 
 
 
 
 

 

 
 
 
 
 
15
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
32
 
 
 
 
 
 
101.INS
 
The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document
 
 
 
 
*
101.SCH
 
XBRL Taxonomy Extension Schema Document
 
 
 
 
*
101.CAL
 
XBRL Taxonomy Calculation Linkbase Document
 
 
 
 
*
101.DEF
 
XBRL Taxonomy Extension Definition Linkbase Document
 
 
 
 
*
101.LAB
 
XBRL Taxonomy Label Linkbase Document
 
 
 
 
*
101.PRE
 
XBRL Taxonomy Presentation Linkbase Document
 
 
 
 
†
 
Denotes management contract or compensatory plan or arrangement

 
 
 
*
 
Submitted electronically herewith

Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) consolidated statement of income for the three months ended March 31, 2019 and 2018, (ii) consolidated statement of comprehensive income for the three months ended March 31, 2019 and 2018, (iii) consolidated statement of condition as of March 31, 2019 and December 31, 2018, (iv) consolidated statement of changes in shareholders' equity for the three months ended March 31, 2019 and 2018, (v) consolidated statement of cash flows for the three months ended March 31, 2019 and 2018, and (vi) notes to consolidated financial statements.


State Street Corporation | 93



SIGNATURES
Pursuant to the requirement 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
 
 
 
 
 
(Registrant)
 
 
 
 
 
 
 
 
 
 
 
 
Date:
May 1, 2019
 
By:
 
/s/ ERIC W. ABOAF
 
 
 
 
 
Eric W. Aboaf,
 
 
 
 
 
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
 
 
 
 
 
 
 
 
 
 
 
 
Date:
May 1, 2019
 
By:
 
/s/ IAN W. APPLEYARD
 
 
 
 
 
Ian W. Appleyard,
 
 
 
 
 
Executive Vice President, Global Controller and Chief Accounting Officer
(Principal Accounting Officer)
 
 
 
 
 
 


State Street Corporation | 94

EMPLOYMENT AGREEMENT AGREEMENT by and between State Street Corporation, a Massachusetts corporation (the “Company”), and (the “Executive”), dated as of the __ day of ________, 20__. The Board of Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined in Section 2) of the Company. The Board believes that it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and dedication to the Company Group (as defined in Section 1) currently and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control which ensure that the compensation and benefits expectations of the Executive will be addressed appropriately. Therefore, in order to accomplish these objectives, the Board caused the Company to enter into this Agreement. NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS: 1. Certain Definitions. For purposes of this Agreement, including, without limitation, Sections 5 and 6, the terms described in Sections 1(a), 1(b) and 1(c) shall have the meanings set forth therein: (a) The “Effective Date” shall mean the first date during the Change of Control Period (as defined in Section 1(b)) on which a Change of Control occurs. Anything in this Agreement to the contrary notwithstanding, if a Change of Control occurs and if the Executive’s employment with the Company Group is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then for all purposes of this Agreement the “Effective Date” shall mean the date immediately prior to the date of such termination of employment. (b) The “Change of Control Period” shall mean the period commencing on the date hereof and ending on December 31, 2020; provided, however, that commencing on December 31, 2019, and on each annual anniversary of such date (such date and each annual anniversary thereof shall be hereinafter referred to as the “Renewal Date”), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate two years from such Renewal Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to the Executive that the Change of Control Period shall not be so extended. (c) The “Company Group” shall mean the Company and any company controlled by, controlling or under common control with the Company. 2. Change of Control. For the purpose of this Agreement, a “Change of Control” shall mean:

 
(a) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either (i) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change of Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (D) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or (b) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or (c) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 25% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of 2

 
directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or (d) Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company. 3. Employment Period. The Company hereby agrees to continue the Executive in the employ of the Company Group, and the Executive hereby agrees to remain in the employ of the Company Group, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the second anniversary of the Effective Date (the “Employment Period”). 4. Terms of Employment. (a) Position and Duties. (i) During the Employment Period, (A) the Executive’s position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and (B) the Executive’s services shall be performed at the location where the Executive was employed immediately preceding the Effective Date or any office or location less than 35 miles from such location. (ii) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company Group and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company Group in accordance with this Agreement. It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive’s responsibilities to the Company Group. (b) Compensation. (i) Base Salary. During the Employment Period, the Executive shall receive the Executive’s annual base salary plus the annualized value of any role based allowance in place as of the Effective Date, (together referred to as “Annual Base Salary”), which shall be paid at a monthly rate. The calculation of Annual Base Salary shall be in an amount at least equal to 12 times the highest monthly base salary (plus any applicable role based allowance) paid or payable, including any base salary (plus any applicable role based allowance) which has been earned but deferred, in respect of the 12-month period immediately preceding the month in which the Effective Date occurs. Such Annual Base Salary shall be payable as earned in equal 3

 
installments, no less frequently than monthly, pursuant to the Company Group’s customary payroll policies applicable to the Executive in force at the time of payment, less any required or authorized payroll deductions, and unless the Executive shall elect to defer the receipt of a portion of such Annual Base Salary in accordance with the requirements of Section 409A of the Internal Revenue Code of 1986 (the “Code”). During the Employment Period, the Annual Base Salary shall be reviewed no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date and thereafter at least annually. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” as utilized in this Agreement shall refer to Annual Base Salary as so increased. (ii) Annual Bonus. In addition to Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) in cash at least equal to the product of the Annual Base Salary and the ratio (expressed as a percentage) obtained by dividing (A) the cash portion of the annual incentive compensation award actually awarded to the Executive under the Company Group annual incentive plan applicable to the Executive, or any successor plan in effect from time to time, for the last full fiscal year prior to the Effective Date by (B) the Annual Base Salary (or, in the event that the Executive was not employed by the Company during such fiscal year or was otherwise not a participant in any such plan, 200%) (the “Recent Annual Bonus Percentage”). For the purposes of this section 4(b)(ii), the cash portion of the Executive’s annual incentive compensation award will be deemed to include any award denominated in cash (as opposed to equity interests), whether payable immediately or on a deferred basis, and, if deferred, whether notionally invested in Company stock or other notional investment option for the deferral period. Each such Annual Bonus shall be paid in a single lump sum in cash no later than March 15th of the year succeeding the year for which the Annual Bonus is earned, unless the Executive shall elect to defer receipt of such Annual Bonus in accordance with the requirements of Section 409A of the Code. (iii) Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other peer executives of the Company Group, but in no event shall such plans, practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company Group for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company Group in the country in which the Executive is employed. To the extent applicable, the benefits provided to the Executive pursuant to this Section 4(b)(iii) shall be provided and paid in compliance with the relevant requirements of Section 409A of the Code. 4

 
(iv) Welfare Benefit Plans. During the Employment Period, the Executive and/or the Executive’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company Group (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer executives of the Company Group, but in no event shall such plans, practices, policies and programs provide the Executive and/or the Executive’s family with benefits that are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company Group in the country in which the Executive is employed. To the extent applicable, the benefits provided to the Executive and/or the Executive’s family pursuant to this Section 4(b)(iv) shall be provided and paid in compliance with the relevant requirements of Section 409A of the Code. (v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company Group in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company Group in the country in which the Executive is employed. Reimbursement shall be made as soon as practicable after a request for reimbursement is received by the Company Group, but in no event later than the last day of the calendar year next following the calendar year in which such expense was incurred. (vi) Fringe Benefits. During the Employment Period, the Executive shall be entitled to fringe benefits, including, without limitation, if applicable, use of an automobile and payment of related expenses, in accordance with the most favorable plans, practices, programs and policies of the Company Group in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company Group in the country in which the Executive is employed. Reimbursements or payments shall be made as soon as practicable after a request for reimbursement or payments is received by the Company Group, but in no event later than the last day of the calendar year next following the calendar year in which such expense was incurred; provided that the amount of any fringe benefits to be reimbursed or paid by the Company Group in one year shall not affect any fringe benefits to be reimbursed or paid by the Company Group in any other calendar year. (vii) Office and Support Staff. During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company Group at any time during the 120-day period immediately preceding the Effective Date 5

 
or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company Group in the country in which the Executive is employed. (viii) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company Group as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company Group in the country in which the Executive is employed. 5. Termination of Employment. For purposes of this Agreement, the terms “terminate,” “terminated” and “termination” mean a termination of the Executive’s employment that constitutes a “separation from service” within the meaning of the default rules set forth in Section 1.409A-1(h) of the Treasury Regulations; provided, however, that for purposes of determining which entities are treated as a single “service recipient” with the Company, the phrase “at least 80 percent” shall be retained in each place it appears in Sections 1563(a)(1), (2) and (3) of the Code and Section 1.414(c)-2 of the Treasury Regulations, as permitted under Section 1.409A-1(h)(3) of the Treasury Regulations; and provided further that in the event that the Executive is absent from work due to any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for [a continuous period of not less than six months] [for Hong Kong employees: the foreseeable future, and no reasonable accommodation can be made to facilitate a return to work] (an “Impairment”), where such Impairment causes the Executive to be unable to perform the duties of his position or any substantially similar position of employment, the Executive shall incur a separation from service 29 months after the date on which the Executive was first Impaired. (a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. If the Company determines in good faith that the Disability of the Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), it may give to the Executive written notice in accordance with Section 14(b) of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company Group shall terminate effective on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”); provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s duties. For purposes of this Agreement, “Disability” shall mean the absence of the Executive from the Executive’s duties with the Company Group on a full-time basis for 180 consecutive days as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative. (b) Cause. The Company may terminate the Executive’s employment during the Employment Period for Cause. For purposes of this Agreement, “Cause” shall mean: 6

 
(i) the willful and continued failure of the Executive to perform substantially the Executive’s duties with the Company Group (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer believes that the Executive has not substantially performed the Executive’s duties; or (ii) the willful engaging by the Executive in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company. For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer of the Company or a senior officer of the Company who is a member of the Company’s executive management committee or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particulars thereof in detail. (c) Good Reason. The Executive’s employment may be terminated by the Executive for Good Reason during the Employment Period. For purposes of this Agreement, “Good Reason” shall mean: (i) the assignment to the Executive of any duties materially inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 4(a), or any other action by the Company Group which results in a material diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company Group promptly after receipt of notice thereof given by the Executive; or (ii) any failure by the Company Group to comply with any of the provisions of Section 4(b), other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive; or (iii) the Company’s requiring the Executive to be based at any office or location other than as provided in Section 4(a)(i)(B) or the Company’s requiring 7

 
the Executive to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date; or (iv) any purported termination by the Company Group of the Executive’s employment otherwise than as expressly permitted by this Agreement; or (v) any failure by the Company to comply with and satisfy Section 13(c). For purposes of this Section 5(c), any good faith determination of “Good Reason” made by the Executive shall be conclusive. (d) Resignation without Good Reason. Notwithstanding anything in this Agreement to the contrary, following the Effective Date, the Executive may, voluntarily, terminate his employment without Good Reason during the Employment Period. (e) Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 14(b). For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination (as defined in Section 5(f)) is other than the date of receipt of such notice, specifies the termination date (which date shall be not [for Hong Kong employees: less than 7 days and not] more than 30 days after the giving of such notice [for Hong Kong employees: in all cases other than termination for cause or the death of the Executive]). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder. (f) Date of Termination. “Date of Termination” means (i) if the Executive’s employment is terminated by the Company for Cause, [or by the Executive for Good Reason,] the date of receipt of the Notice of Termination or any later date specified therein, as the case may be; (ii) if the Executive’s employment is terminated by the Company other than for Cause or Disability, [for Hong Kong employees: or by the Executive for Good Reason,] the Date of Termination shall be [for Hong Kong employees: 7 days after] the date on which the Company notifies the Executive of such termination [for Hong Kong employees: (unless payment in lieu of notice is made)]; and (iii) if the Executive’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be. 6. Obligations of the Company upon Termination. (a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate the Executive’s employment other than for Cause, death or Disability or the Executive shall terminate employment for Good Reason: 8

 
(i) the Company shall pay to the Executive in a lump sum in cash within [30 days] [for Hong Kong employees: 7 days] after the Date of Termination the aggregate of the following amounts: (A) the sum of (1) the Executive’s Annual Base Salary through the Date of Termination to the extent not theretofore paid, (2) any earned Annual Bonus in respect of the fiscal year ended immediately prior to the Date of Termination to the extent not theretofore paid, (3) the product of (x) the Recent Annual Bonus Percentage and (y) the Executive’s Annual Base Salary and (z) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination, and the denominator of which is 365 and (4) any accrued vacation pay, to the extent not theretofore paid (the sum of the amounts described in clauses (1), (2), (3) and (4) shall be hereinafter referred to as the “Accrued Obligations”); and (B) the amount equal to the product of (1) two and (2) the sum of (x) the Executive’s Annual Base Salary and (y) the product of (I) the Recent Annual Bonus Percentage and (II) the Executive’s Annual Base Salary; provided that any amount payable to the Executive pursuant to this clause (B) shall not exceed $10,000,000 (ten million dollars) (“Base and Bonus Cap”) and all rights to any amount payable under this subparagraph 6(i)(B) exceeding the Base and Bonus Cap shall be cancelled and the Executive shall have no further rights or entitlement to the amounts payable under this subparagraph 6(i)(B) that exceed the Base and Bonus Cap; and (C) [for Hong Kong employees: to the extent applicable,] the amount equal to the product of (1) two and (2) an amount equal to the sum of any Company Group contributions allocated to the Executive under (x) the Company Group tax-favored defined contribution retirement plans applicable to the Executive and (y) the State Street Corporation Management Supplemental Savings Plan or any successor plan (the “Supplemental Savings Plan”) for the most recent full fiscal year; and [(D) to the extent applicable, an amount equal to the excess of (a) the actuarial equivalent of the benefit under the State Street Retirement Plan (the “Retirement Plan”) (utilizing actuarial assumptions no less favorable to the Executive than those in effect under the Retirement Plan immediately prior to the Effective Date), and any excess or supplemental defined benefit pension under the State Street Corporation Management Supplemental Retirement Plan (the “MSRP”) , the State Street Corporation Executive Supplemental Retirement Plan (the “ESRP DB”) and/or the Supplemental Pension Plan of Investors Bank & Trust Company, or any successor plan(s), in which the Executive participates immediately prior to the Effective Date (collectively, the “SERP”) which the Executive would receive under the terms thereof as in effect immediately prior to the Effective Date, if the Executive’s employment continued for two years after the Date of Termination 9

 
assuming that the Executive’s compensation in each of the two years is that required by Section 4(b)(i) and Section 4(b)(ii), over (b) the actuarial equivalent of the Executive’s actual benefit (paid or payable), if any, under the Retirement Plan and the SERP as of the Date of Termination; provided that for purposes of calculating the payment pursuant to this subparagraph 6(a)(i)(D), there shall be no additional accruals included under the respective Retirement Plan and SERP calculations to the extent that said plans are frozen and do not provide for new accruals as of the Effective Date; and] (ii) for two years after the Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue benefits to the Executive and/or the Executive’s family at least equal to those which would have been provided to them in accordance with the plans, programs, practices and policies described in Section 4(b)(iv) if the Executive’s employment had not been terminated or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company Group and their families in the country in which the Executive is employed on the same basis as in effect prior to the Date of Termination; provided, however, that if the Executive becomes reemployed with another employer and is eligible to receive medical or other welfare benefits under another employer provided plan, the medical and other welfare benefits described herein shall be secondary to those provided under such other plan during such applicable period of eligibility; provided further that to the extent necessary to avoid the imposition of additional taxes, penalties and interest under Section 409A of the Code, any reimbursements of expenses pursuant to this Section 6(a)(ii) shall be made on or before the last day of the calendar year next following the calendar year in which such expense was incurred. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed until two years after the Date of Termination and to have retired on the last day of such period; and (iii) the Company shall, at its sole expense as incurred, provide the Executive with reasonable outplacement services, the scope and provider of which shall be selected by the Executive in his sole discretion; provided, however, that such outplacement services shall not be provided to the Executive beyond the last day of the second calendar year following the calendar year which contains the Executive’s Date of Termination; and (iv) to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any other amounts or benefits required to be paid or provided or which the Executive is entitled to receive as of the Date of Termination under any plan, program, policy or practice or contract or agreement of the Company Group (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”); and (v) to the extent not theretofore vested, the Executive shall immediately vest, as of the Date of Termination, in his benefits under the [plans comprising the defined contribution component of the State Street Corporation 10

 
Executive Supplemental Retirement Plan, or successor plan, as in effect immediately prior to the Effective Date (“ESRP DC”), Supplemental Savings Plan, and/or any applicable SERP in which he participates on the Date of Termination, including, notwithstanding Section 3.6 (Forfeitures) under the terms of the State Street Corporation Executive Supplemental Retirement Plan] [for Hong Kong employees: Supplemental Savings Plan and the State Street Corporation Executive Supplemental Retirement Plan (“ESRP”)] (b) Death. If, during the Employment Period, the Executive’s employment is terminated by reason of the Executive’s death, this Agreement shall terminate without further obligations to the Executive’s legal representatives under this Agreement, other than for payment of Accrued Obligations, the timely payment or provision of Other Benefits, and immediate vesting, as of the Date of Termination and to the extent not theretofore vested, of the Executive’s benefits under the [plans comprising the ESRP DC, Supplemental Savings Plan and/ or any applicable SERP in which he participates on the Date of Termination] [for Hong Kong employees: Supplemental Savings Plan and the ESRP]. The Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within [30 days] [for Hong Kong employees: 7 days] after the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall include, without limitation, and the Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company Group to the estates and beneficiaries of peer executives of the Company Group under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other peer executives of the Company Group and their beneficiaries in the country in which the Executive is employed. (c) Disability. If, during the Employment Period, the Executive’s employment is terminated by reason of the Executive’s Disability, this Agreement shall terminate without further obligations to the Executive under this Agreement, other than for payment of Accrued Obligations, the timely payment or provision of Other Benefits, and immediate vesting, as of the Date of Termination and to the extent not theretofore vested, of the Executive’s benefits under the [plans comprising the ESRP DC, Supplemental Savings Plan and/or any applicable SERP in which he participates on the Date of Termination] [for Hong Kong employees: Supplemental Savings Plan and the ESRP]. The Accrued Obligations shall be paid to the Executive in a lump sum in cash within [30 days] [for Hong Kong employees: 7 days] after the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company Group to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in 11

 
effect at any time thereafter generally with respect to other peer executives of the Company Group and their families in the country in which the Executive is employed. (d) For Cause; Other than for Good Reason. If, during the Employment Period, the Executive’s employment shall be terminated for Cause, this Agreement shall terminate without further obligations to the Executive other than the obligation to pay or to provide to the Executive (x) his Annual Base Salary through the Date of Termination within [30 days] [for Hong Kong employees: 7 days] thereafter and (y) Other Benefits, in each case to the extent theretofore unpaid. Subject to Section 7, if, during the Employment Period, the Executive voluntarily terminates employment, excluding a termination for Good Reason, this Agreement shall terminate without further obligations to the Executive, other than for Accrued Obligations and the timely payment or provision of Other Benefits. In such case, all Accrued Obligations shall be paid to the Executive in a lump sum in cash within [30 days] [for Hong Kong employees: 7 days] after the Date of Termination. 7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company Group and for which the Executive may qualify, nor, subject to Section 14(g), shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company Group, including, without limitation, the ESRP [DC, Supplemental Savings Plan and/or any applicable SERP in which the Executive participates on the Date of Termination]; provided, however, that, following the Effective Date, the severance provisions of this Agreement shall supersede any Company severance pay plan in which the Executive may otherwise participate. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company Group at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement; provided that, for the avoidance of doubt, any such modifications made by this Agreement shall comply with, and shall be effected and implemented, in accordance with the requirements of Section 409A of the Code. [Anything in the State Street Corporation Executive Supplemental Retirement Plan (the “ESRP”) to the contrary notwithstanding, during the Employment Period: (I) Section 7.1 (Amendments) thereof shall be inapplicable to the Executive to the extent such amendment reduces the accrued benefit or contribution rate or otherwise adversely affects the right of the Executive to accrue an ESRP benefit; and (II) Section 3.6 (Forfeitures) thereof shall be inapplicable to the Executive in connection with any termination of employment (other than for Cause (as defined under this Agreement)). Anything in the MSRP to the contrary notwithstanding, the first sentence of Section 5 thereof shall be inapplicable to the Executive in connection with any termination of employment (other than for Cause (as defined under this Agreement)).] 8. Full Settlement. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others, except as 12

 
required by applicable law or regulation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Executive obtains other employment. Furthermore, the Executive shall be entitled to receive from the Company payment in respect of all direct and indirect damages as a result of any material breach by the Company of this Agreement. From the date hereof until the 20th anniversary of the later of (i) the Date of Termination and (ii) the date of the Executive’s death, the Company agrees to pay as incurred, to the full extent permitted by law, any legal fees and/or expenses which the Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, or breach by the Company of, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(A) of the Code; provided, however, that payment of legal fees and/or expenses shall not be provided to the Executive later than the last day of the second calendar year in which the relevant fees or expenses were incurred; provided, further, that the amount of any legal fees and/or expenses paid by the Company on behalf of the Executive during a calendar year shall not affect any legal fees and/or expenses to be paid by the Company on behalf of the Executive in any other calendar year. 9. Application of Section 4999 of the Code. (a) This Section 9 shall apply, in the event it shall be determined that any payment or distribution by the Company Group to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise) (the “Payments”) could reasonably be expected to be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”). (b) If it shall be determined that the Parachute Value of the Payments (as defined below) is equal to or less than 110% of the Safe Harbor Amount (as defined below), then the amount of the Payments otherwise due to, or for the benefit of, the Executive shall be reduced to the extent necessary, and in a manner intended to comply with Section 409A of the Code, to assure that the Parachute Value of the Payments, as calculated for the Payments remaining after such reduction, does not exceed the Safe Harbor Amount (a “Cutback”). To the extent any such reduction to the Executive’s Payments becomes necessary by reason of the preceding sentence; the reduction shall be applied by (x) reducing the cash payments and benefits due to the Executive under this Agreement in the following order: Section 6(i)(B), Section 6(i)(C) and then, if applicable, Section 6(i)(D),or (y) an order of reduction specified by the Executive; provided, however, that the Executive’s right to specify the order of reduction of the payments or benefits shall apply only to the extent that it does not directly or indirectly alter the time or method of payment of any amount that is deferred compensation subject to Section 409A. For the purposes of this Section 9, (i) “Parachute Value of the Payments” shall mean the present value, as of the Effective 13

 
Date, for purposes of Section 280G of the Code of the portion of such Payments that constitutes a “parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm (as defined in Section 9(c)) for purposes of determining whether and to what extent the Excise Tax will apply to such Payments, and (ii) “Safe Harbor Amount” shall mean the maximum Parachute Value of the Payments that the Executive can receive without any Payments being subject to the Excise Tax. (c) If it shall be determined that the Parachute Value of the Payments is greater than 110% of the Safe Harbor Amount, then the value of the Payments to be made to the Executive shall be either (i) subject to a Cutback or (ii) delivered in full, whichever of the foregoing results in the receipt by the Executive of the greatest benefit on an after-tax basis (taking into account the Executive’s actual marginal rate of federal, state and local income taxation and the Excise Tax). (d) All determinations required to be made under this Section 9, including whether and when a Cutback is required and the amount of such Cutback and the assumptions to be utilized in arriving at such determination, shall be made by Ernst & Young LLP or such other nationally recognized certified public accounting firm as may be designated by the Executive (the “Accounting Firm”); provided that such Accounting Firm shall be independent of the Executive. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change of Control, the Executive shall appoint another independent nationally recognized accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. The Accounting Firm shall make the determinations required under this Section 9 on a preliminary basis and provide to both the Company and the Executive the detailed supporting calculations on an initial basis, as soon as reasonably practicable prior to the making of any Payment, but in no event later than 10 days prior to the Effective Date. Thereafter, the Accounting Firm shall timely make any further determinations as may be required under this Section 9 and provide to both the Company and the Executive additional detailed supporting calculations as necessary or appropriate to effectuate the provisions of this Section 9. If, as a result of the uncertainty in the application of Section 4999 of the Code at the time of the preliminary or a subsequent determination by the Accounting Firm hereunder, amounts that should have been subject to a Cutback were instead paid or provided to the Executive (“Overpayment”), consistent with the calculations required to be made hereunder, then, in the event that the Executive is required to make a payment of any Excise Tax solely as a result of an Overpayment, the Accounting Firm shall determine the amount of the Overpayment that has occurred and the Company shall indemnify the Executive for any damages, including, without limitation, the Excise Tax, and costs incurred by him resulting from any Overpayment. Any amounts payable by the Company or any other member of the Company Group to the Executive as a result of the Company’s indemnification obligations as provided for in the immediately preceding sentence shall be paid no later than the last day of the calendar year following the calendar year in which the Executive remits the related taxes. 14

 
10. Confidential Information; Restriction on Solicitation of Employees and Clients. By and in consideration of the compensation and benefits provided for by the Company under this Agreement, including the severance arrangements set forth herein, the Executive agrees that: (a) The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company Group, and the respective businesses of the members of the Company Group and their Clients (as defined below), which shall have been obtained by the Executive during the Executive’s employment by the Company Group and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company Group, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those designated by it. For the purposes of this Section 10, the term “Client” means any person or entity that is a customer or client of any member of the Company Group. (b) During the term of employment of the Executive and following the termination thereof, the Executive shall not make any false, disparaging, or derogatory statements to any media outlet (including, but not limited to, Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry group or financial institution, or to any current, former or prospective employee, consultant or Client of the Company or its subsidiaries regarding the Company, its subsidiaries or any of their respective directors, officers, employees, agents, or representatives, or about the business affairs and financial condition of the Company or its subsidiaries. (c) During the term of employment of the Executive and following the termination thereof, the Executive shall cooperate with the Company with respect to any matters arising during or related to the Executive’s employment with the Company Group, including but not limited to any litigation, governmental investigation, or regulatory or other proceeding which may have arisen as of or which may arise following the execution of this Agreement. The Company shall reimburse the Executive for any reasonable out-of-pocket and properly documented expenses the Executive incurs in connection with such cooperation. (d) During the term of employment of the Executive and during the Nonsolicitation Period (as defined below), the Executive shall not, without the prior written consent of the Company, solicit, directly or indirectly (other than through a general solicitation of employment not specifically directed to employees of the Company or its subsidiaries), the employment of any person who within the previous 12 months was an officer of the Company or any of its subsidiaries. For purposes of this Section 10, the term “Nonsolicitation Period” means the period beginning on the date of termination of the Executive’s employment with the Company Group (the “Termination Date”) and ending on the earlier of (i) [18 months after the Termination Date] [for Hong Kong employees: 6 months after the Termination Date and for a further 6 month period after that initial period] and (ii) [one year after the Effective Date (if any)] [for Hong Kong employees: 6 months after the Effective Date (if any) and for a further 6 15

 
month period after that initial period]. If the Executive violates a restriction to which the Nonsolicitation Period applies under this Section 10(d) or 10(e), then the Nonsolicitation Period shall be extended, with respect only to the restriction violated by the Executive, by the amount of time for which the Executive was out of compliance with such restriction. (e) During the term of employment of the Executive and during the Nonsolicitation Period, the Executive shall not, without the prior consent of the Company, [for Hong Kong employees: directly or indirectly,] engage in the Solicitation of Business (as defined below) from any Client on behalf of any person or entity other than the Company and its subsidiaries. For the purposes of this Section 10(c), the term “Solicitation of Business” shall mean the attempt through direct personal contact on the part of the Executive with a Client with whom the Executive has had significant personal contact while serving in a Line-Function Capacity (as defined below) during his period of employment to [for Hong Kong employees: solicit or] induce such Client to transfer its business relationship [for Hong Kong employees: in whole or in part] from the Company and its subsidiaries to any other person or entity. The term “Line-Function Capacity” means service to the Company and its subsidiaries in a primary capacity other than a staff function, in which the Executive has direct and regular contact with Clients and responsibility for managing the business relationship of the Company and its subsidiaries with such Clients. During the Nonsolicitation Period, the Executive may accept employment with or enter into a business relationship with a person or entity that has or seeks to establish business relationships with one or more Clients provided that the Executive does not engage in the Solicitation of Business from such Clients and does not disclose confidential information concerning such Client and its relationship with the Company and its subsidiaries to any such person or entity. (f) In no event shall an asserted violation of the provisions of this Section 10 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement. (g) This Section 10 shall be effective from and after the date of this Agreement notwithstanding that an Effective Date has not occurred, and the restrictions and covenants set forth in this Section 10 shall be in addition to, and shall not supersede, any restrictions or covenants to which the Executive may be subject pursuant to other plans, programs or agreements with the Company, including, without limitation, the nonsolicitation and noncompetition provisions contained in Section 3.6 of the ESRP (except to the extent specifically provided otherwise in Section 7 of this Agreement). (h) The provisions contained in this Section 10 are necessary to the protection of the Company’s business and good will, and are material and integral to the undertakings of the Company under this Agreement. The Executive agrees that the Company and its subsidiaries will be irreparably harmed in the event such provisions are not performed in accordance with their specific terms or are otherwise breached by the Executive. Accordingly, if the Executive fails to comply with such provisions, the Company or any of its subsidiaries shall be entitled to injunctive or other equitable relief or remedy in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled hereunder in order to protect its or their legitimate business 16

 
interests. Therefore, the Executive agrees that the Company or any of its subsidiaries shall, in the event of any breach or threatened breach by the Executive of the provisions of this Section 10, in addition to such other remedies as may be available, be entitled to specific performance and injunctive relief without posting a bond. The Executive hereby waives the adequacy of a remedy at law as a defense to such relief. (i) No delay or waiver by the Company in exercising any right under this Section 10 shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by the Company must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (j) The restrictions and covenants set forth in this Section 10 shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each such provision is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Section 10 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (k) Nothing in this Agreement prohibits Executive from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of Federal law or regulation. Moreover, nothing in this Agreement requires Executive to notify the Company that Executive has made any such report or disclosure. However, in connection with any such activity, Executive must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (l) Executive shall not be held criminally or civilly liable under any Federal or state trade secret law if Executive discloses a Company or a Company affiliated organization trade secret (i) in confidence to a Federal, state, or local government official, either directly or indirectly, or to an attorney, solely for the purposes of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. (m) Despite the foregoing, Executive is not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of his or her employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. The Company and its affiliated organizations do not waive any applicable privileges or the right to continue to protect its or their privileged attorney-client information, attorney work product, and other privileged information. 17

 
11. Section 409A of the Code. (a) This Agreement is intended to satisfy the requirements of Section 409A of the Code with respect to amounts subject thereto and shall be interpreted and construed and shall be performed by the parties consistent with such intent, and the Company shall not accelerate any payment or the provision of any benefits under this Agreement or to make or provide any such payment or benefits if such payment or provision of such benefits would, as a result, be subject to tax under Section 409A of the Code. (b) Except as expressly provided otherwise herein, no reimbursement payable to the Executive pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company covered by this Agreement shall be paid later than the last day of the calendar year following the calendar year in which the related expense was incurred, and no such reimbursement during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year, except, in each case, to the extent that the right to reimbursement does not provide for a “deferral of compensation” within the meaning of Section 409A of the Code. To the extent providing for deferral of compensation within the meaning of Section 409A of the Code, any payments or benefits to which the Executive is entitled upon a termination of employment shall be paid no earlier than the date on which the Executive incurs a “separation from service” as set forth in Section 5. (c) Notwithstanding anything herein to the contrary, if the Executive is a “specified employee,” for purposes of Section 409A of the Code, as determined under the Company’s established methodology for determining specified employees, on the date on which the Executive separates from service, any payment hereunder (including any provision of continued benefits) that provides for the deferral of compensation within the meaning of Section 409A of the Code (the “Delayed Payment Amounts”) shall not be paid or commence to be paid on any date prior to the first business day after the date that is six months following the Executive’s Date of Termination; provided, however, that payment of the Delayed Payment Amounts shall commence within 30 days of the Executive’s death in the event of his death prior to the end of the six-month period. The Delayed Payment Amounts shall earn interest at the prime rate published in The Wall Street Journal on the Date of Termination until the date that payment of such amounts to the Executive or his legal representatives is completed pursuant to the terms of this Agreement. 12. Statement of Benefits. Immediately prior to the Effective Date, the Company shall provide in writing to the Executive a reasonable, good faith estimate of the payments and benefits to which the Executive would be entitled in the event of a termination of his employment pursuant to Section 6(a), assuming that the Effective Date is the Date of Termination. 13. Successors. (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. (b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. 18

 
(c) This Agreement may not be assigned by the Company, other than to a member of the Company Group, without the written consent of the Executive, and the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business and/or assets of the Company, to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. In the event that the Company obtains the express assumption and agreement to perform this Agreement as contemplated by the preceding sentence, the Executive agrees that his execution of this Agreement shall serve as his written consent in such circumstance. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise. 14. Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, without reference to principles of conflict of laws. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives. (b) All notices and other communications hereunder shall be in writing and shall be given to the other party by hand delivery, by electronic email, or by private overnight delivery, in each case with proof of receipt, addressed as follows: If to the Executive, at the most recent address in the records of the Company Group. If to the Company: State Street Corporation State Street Financial Center One Lincoln Street Boston, MA 02111-2900 Attention: Chief Legal Officer or to such other address as either party shall have furnished to the other in writing in accordance herewith. For purposes of this Agreement, notice and communications shall be effective (i) on the date of delivery, with respect to hand delivery, or (ii) when posted with respect to email or private overnight delivery, except with respect to a Notice of Termination, which shall be effective when actually received by the addressee, with respect to any form of delivery. (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. (d) The headings of sections herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement, and section, paragraph and subparagraph references in this Agreement, unless otherwise specified, refer to the applicable section, paragraph or subparagraph of this Agreement. In addition, for the purposes of this Agreement, 19

 
references to statutes and regulations shall be deemed to include any amended, modified or successor statutes or regulations. (e) The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation and all other authorized deductions. (f) The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 5(c)(i) - (v), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. (g) The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and any member of the Company Group, the employment of the Executive by the Company Group is “at will” and, subject to Section 1(a), prior to the Effective Date, the Executive’s employment and/or this Agreement may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. (h) This Agreement sets forth all of the promises, agreements, conditions and understandings between the parties hereto respecting the subject matter hereof and supersedes all prior negotiations, conversations, discussions, correspondence, memoranda and agreements between the parties concerning such subject matter, including any outstanding change in control employment agreement in effect as of the date of this Agreement. From and after the Effective Date, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof. [For certain Hong Kong employees: Further, this Agreement is to be read in conjunction with your individual contract of employment. In the event that there is any inconsistency between any of the terms of this Agreement and those set out in your contract of employment, the terms of this Agreement which are inconsistent shall prevail.] (i) This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. For purposes of this Agreement, facsimile signatures shall be deemed originals, and the parties agree to exchange original signatures as promptly as possible following execution of this Agreement. The Executive acknowledges that he is entering into this Agreement of his own free will and accord, and with no duress, that he has read this Agreement and that he understands it and its legal consequences. IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written. 20

 
[Executive] _______________________________ STATE STREET CORPORATION By Todd Gershkowitz EVP, Chief Operating Officer - Global Human Resources and Corporate Citizenship 21

 
AMENDED AND RESTATED STATE STREET CORPORATION SUPPLEMENTAL CASH INCENTIVE PLAN Effective as of January 1, 2014

 
TABLE OF CONTENTS ARTICLE I Name, Purpose and Definitions .................................................................................. 1 1.1 Name and Effective Date. ................................................................................................ 1 1.2 Status of Plan ................................................................................................................... 1 1.3 Definitions........................................................................................................................ 1 ARTICLE II Participation And Vesting ......................................................................................... 3 2.1 Eligibility to Participate ................................................................................................... 3 2.2 Vesting Date..................................................................................................................... 3 2.3 Termination of Participation ............................................................................................ 3 ARTICLE III Awards and Distribution .......................................................................................... 3 3.1 Awards; Award Provisions .............................................................................................. 3 3.2 Accounts; Notional Tracking Options ............................................................................. 3 3.3 Form of Payment.............................................................................................................. 4 3.4 Timing of Payment .......................................................................................................... 4 3.5 Treatment of Awards following Separation of Service ................................................... 4 3.6 Forfeiture of Awards ........................................................................................................ 5 3.7 Special Rules .................................................................................................................... 5 3.8 Rehire ............................................................................................................................... 5 3.9 Certain Tax Matters. . ..................................................................................................... 5 3.10 Distribution of Taxable Amounts .................................................................................... 6 ARTICLE IV Administration of Plan ............................................................................................. 6 4.1 Plan Administrator ........................................................................................................... 6 4.2 Outside Services............................................................................................................... 7 4.3 Indemnification ................................................................................................................ 7 ARTICLE V Amendment, Modification and Termination............................................................. 7 5.1 Amendment; Termination ................................................................................................ 7 ARTICLE VI Miscellaneous Provisions ........................................................................................ 7 6.1 Source of Payments.......................................................................................................... 7 6.2 No Warranties; No Liability ............................................................................................ 8 6.3 Inalienability of Benefits.................................................................................................. 8 6.4 Reclassification of Employment Status ........................................................................... 8 6.5 Application of Local Law.. .............................................................................................. 8 6.6 Expenses. ......................................................................................................................... 8 6.7 No Right of Employment ................................................................................................. 9 6.8 Headings .......................................................................................................................... 9 6.9 Construction ..................................................................................................................... 9 -i-

 
ARTICLE I Name, Purpose and Definitions 1.1 Name and Effective Date. The Plan sets forth the terms of the Amended and Restated State Street Corporation Supplemental Cash Incentive Plan effective January 1, 2014. All benefits under the Plan shall be subject to the terms and conditions of this Plan document. 1.2 Status of Plan. The Plan has been established for the purpose of rewarding, retaining and motivating Participants for services and performance during the period from the date of grant of an Award to the date of vest of an Award. The Plan is intended to be a bonus plan which is not subject to ERISA. The provisions of the Plan are intended to comply with the requirements applicable to a “nonqualified deferred compensation plan” under Code section 409A and the regulations thereunder and shall be interpreted and administered consistent with that intent. 1.3 Definitions. When used herein, the following words shall have the meanings indicated below. (a) “Award” means that portion of the cash bonus awarded to an Eligible Employee under the Company’s Incentive Compensation Plan, or any other cash award to an Eligible Employee, that the Plan Administrator determines, in its discretion, is to be paid in accordance with the terms of this Plan. (b) “Award Agreement” means the document established pursuant to Section 3.1(b). (c) “Beneficiary” means the person or persons designated by the Participant in writing, subject to such rules as the Plan Administrator may prescribe, to receive benefits under the Plan in the event of the Participant’s death. In the absence of an effective designation at the time of the Participant’s death, the Participant’s Beneficiary shall be his or her surviving spouse or domestic partner as determined by the Plan Administrator in its discretion in accordance with its policies, or, if the Participant has no surviving spouse or domestic partner, then the Participant’s estate. (d) “Code” means the Internal Revenue Code of 1986, as amended, and its implementing regulations from time to time. (e) “Company” means State Street Corporation, its subsidiaries and affiliates as determined by the Plan Administrator in its sole discretion. (f) “Committee” means the Executive Compensation Committee of the Board of Directors of State Street Corporation. (g) “Disabled” means, for any Participant, that the Participant, as determined in the sole discretion of the Plan Administrator: is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or 1

 
is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 6 months under an accident and health plan covering employees of the Employer. (h) “EIP” means the 2006 Equity Incentive Plan, as may be amended and in effect from time to time, or successor equity incentive plan of the Company (i) “Eligible Employee” means any employee of an Employer. (j) “Employer” means any or all, as the context requires in order to refer to the employing entity of a Participant, of State Street Corporation and any other entity (or branch) that would be treated as a member of the same controlled group of corporations, or as trades or business under common control, with State Street Corporation, under Code sections 414(b) and (c). (k) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and its implementing regulations from time to time. (l) “Incentive Compensation Plan” means the annual incentive compensation plan under which an Eligible Employee receives a cash award, currently either the Incentive Compensation Plan or the Senior Executive Annual Incentive Plan. (m) “Participant” means an Eligible Employee who has an unpaid Award under the Plan. (n) “Plan” means this Amended and Restated State Street Corporation Supplemental Cash Incentive Plan, as from time to time amended and in effect. (o) “Plan Administrator” means the Plan Administrator appointed pursuant to Section 4.1. (p) “Release of Claims” means contractual documentation releasing the Company and the Employer, to the maximum extent permitted by applicable law, from all contractual and statutory claims a Participant has, or may have, in connection with his or her employment, engagement or termination thereof. (q) “Retirement Eligible” means an Eligible Employee is age 55 or older and has completed five (5) or more years of service with the Company. For this purpose, years of service shall be determined using Company records in a consistent manner by the Plan Administrator in its sole discretion. (r) “Restrictive Covenant” means any confidentiality, non-solicitation, non- competition, non-disparagement, post-employment cooperation or notice provision that the Participant agrees to or has agreed to with the Employer, including but not limited to the restrictions contained in the Award Agreement, any employment agreement or offer letter, equity award agreement, change in control employment agreement or required as a condition to entitlement to payment under any executive supplemental retirement plan. (s) “Separation from Service” means a separation from service, within the meaning of Treas. Regs. §1.409A-1(h), with all Employers that would be treated as a single 2

 
employer with State Street Corporation under the first sentence of Treas. Regs. §1.409A-1(h)(3). (t) “Vest,” “vesting,” and terms of similar import refer to the Participant’s right to payment under an Award becoming non-forfeitable. (u) “Written” “in writing” and similar terms. To the extent permitted by the Plan Administrator, the terms “written,” “in writing,” and terms of similar import shall include communications by electronic media. ARTICLE II Participation And Vesting 2.1 Eligibility to Participate. An Eligible Employee shall become a Participant when issued an Award payable under the terms of this Plan. 2.2 Vesting Date. Each Award shall vest as specified in the Award Agreement or accompanying statement at the time of the issuance of the Award. 2.3 Termination of Participation. Participation in the Plan shall end when all Awards issued to a Participant are either distributed or forfeited consistent with the terms of this Plan. ARTICLE III Awards and Distribution 3.1 Awards; Award Provisions. (a) Awards shall be issued to Eligible Employees (other than executive officers of the Company) as determined by the Committee or the Plan Administrator in its sole discretion. Awards may be issued to Eligible Employees who are executive officers of the Company by the Committee in its sole discretion. (b) The Plan Administrator will determine the terms of all Awards, subject to the limitations set forth herein, including without limitation the time or times at which an Award will vest. Without limiting the foregoing, the Plan Administrator may at any time accelerate the vesting of an Award, regardless of any adverse or potentially adverse tax consequences resulting from such acceleration. The Plan Administrator will document each Award with a written agreement that may set forth specific terms applicable to the Award, including without limitation forfeiture conditions in addition to those specified in Section 3.6, performance criteria, notional tracking designations as described in Section 3.2 and such other provisions, as may determined by the Plan Administrator in its sole discretion. 3.2 Accounts; Notional Tracking Options. The Plan Administrator shall establish for each Participant a bookkeeping account together with such sub-accounts as the Plan Administrator may determine are needed or appropriate to reflect interest provided for in the Participant’s Award and/or adjustments for notional (hypothetical) investment 3

 
experience as described in this Section 3.2. The Plan Administrator may in its discretion designate for purposes of the Plan one or more funds (each, a “tracking fund”) and may allocate the amount of each Award made under the Plan in whole or in part among such tracking funds. The Plan Administrator may also provide a Participant with the discretion to elect to allocate the amount of any Award made under the Plan in whole or in part among such tracking funds. In the absence of an affirmative allocation by a Participant, the Plan Administrator may designate a default tracking fund and allocate the amount of any Award made under the Plan in whole or in part to such tracking fund. Amounts allocated under the Plan to a tracking fund shall be treated as though notionally invested in that tracking fund. The Plan Administrator shall periodically adjust Participant accounts to reflect increases or decreases attributable to these notional investments. The Plan Administrator shall adjust accounts to reflect the notional reinvestment of an amount equivalent to any cash dividends or other cash distributions from a tracking fund. The Plan Administrator may at any time and from time to time eliminate or add tracking funds or substitute a new fund for an existing tracking fund, including with respect to balances already notionally invested under the Plan. The Plan Administrator may, but need not, direct the purchase of securities or other investments with characteristics similar to the tracking funds, but any such securities or other investments shall remain part of the Company’s general assets unless held in a trust described in Section 6.1 in a manner not inconsistent with the requirements of Section 409A(b) of the Code. By his or her acceptance of an Award under the Plan, a Participant agrees, on his or her behalf and on behalf of his or her Beneficiaries, that none of the Company, any Employer, the Committee, the Plan Administrator, or any of their delegates, agents or representatives, shall be liable for any losses or damages of any kind relating to the allocation of an Award to any tracking fund or funds under the Plan. 3.3 Form of Payment. All payments under this Plan will be made in cash out of the Company’s general corporate assets. 3.4 Timing of Payment. The amount of any payment due under an Award shall be determined on the vesting date of such payment and, subject to satisfaction of all conditions of this Plan and the Award Agreement, shall be made to the Participant as soon as administratively feasible following the vesting date, but in no event later than 30 days following the vesting date. 3.5 Treatment of Awards following Separation of Service. Following Separation from Service: (a) A Participant shall continue to vest in any outstanding Award, subject to Section 3.6, if such Participant: is Retirement Eligible at the time of the Separation from Service; or is involuntarily terminated for reasons other than gross misconduct as determined by the Plan Administrator in its sole discretion and the Participant executes a Release of Claims in a form satisfactory to the Plan Administrator. (b) Upon the Participant’s death or becoming Disabled, the Participant shall vest in accordance with Section 3.7. 4

 
(c) Except as provided otherwise in Section 3.7, vesting post-separation, where applicable, shall continue in accordance with the vesting schedule specified at the time of the issuance of the Award. 3.6 Forfeiture of Awards. A Participant shall forfeit all Awards and all amounts due under any Awards if: (a) He or she has a Separation from Service which meets the terms of Section 3.5 but fails to comply with any Restrictive Covenant without the prior written consent of the Plan Administrator; (b) He or she has a Separation from Service on a voluntary basis (other than for Good Reason on or prior to the first anniversary of a Change in Control, each as defined in the EIP) and is not Retirement Eligible; or (c) He or she has a Separation from Service by the Employer and such Separation from Service is classified as being for gross misconduct as determined by the Employer in its sole discretion (even if the Participant is Retirement Eligible at the time of such Separation from Service for gross misconduct). 3.7 Special Rules. (a) Payments on account of Disability. If the Participant is determined to be Disabled, the Award shall become vested in full and the balance of a Participant’s Award, if any, shall be distributed in a single lump sum cash payment to the Participant or the Participant’s Beneficiary or Beneficiaries as soon as practical following the date on which the Participant becomes Disabled but in no event later than 30 days following such date. (b) Payment upon death. Following a Participant’s death, the Award shall become vested in full and the balance of a Participant’s Award, if any, shall be distributed in a single lump sum cash payment to the Participant’s Beneficiary or Beneficiaries as soon as practical following the date of the Participant’s death but in no event later than 30 days following such date. (c) Payment upon a change in control of State Street Corporation. If, on or prior to the first anniversary of the consummation of the Change in Control (as defined in the EIP), the Participant’s employment with the Company is terminated for Good Reason (as defined in the EIP) by the Participant or is terminated without Cause (as defined in the EIP) by the Company, any Award awarded on or after February 20, 2014 shall become fully vested on the date of such termination and the balance of the Award, if any, shall be distributed in a single lump sum payment to the Participant as soon as practical following the date of such termination but in no event later than 30 days following such date. For purposes of this Section 3.7(c), termination of employment shall mean a “separation from service” as determined in accordance with Treasury Regulation Section 1.409A-1(h). 3.8 Rehire. No Award that was forfeited shall be reinstated in the event a Participant who has a Separation from Service is subsequently rehired. 3.9 Certain Tax Matters. All payments under the Plan shall be subject to reduction for applicable tax and other legally or contractually required withholdings. The distribution 5

 
of any vested portion of an Award subject to Section 409A of the Code will not be accelerated or deferred unless specifically permitted or required under Section 409A of the Code. Solely to the extent that a distribution in connection with an Award subject to Section 409A of the Code would be paid pursuant to the terms of this Plan or any Award on account of the Participant’s “Separation from Service” as defined under Section 409A of the Code and the Participant is a “specified employee” as defined under Section 409A, any distribution that otherwise would be paid during the six-month period following such separation from service shall be delayed until the date that is six months and one day after such “Separation from Service.” Any remaining distributions that otherwise would be paid after such six-month period shall be paid at the time set forth in this Plan or any Award. It is intended that each installment of the payments provided under the Plan is a separate “payment” for purposes of Section 409A. In any event, State Street Corporation makes no representations or warranty and will have no liability to any Participant or any other person if any provisions of or payments under this Plan are determined to constitute deferred compensation subject to Section 409A but not to satisfy the conditions of that section. 3.10 Distribution of Taxable Amounts. Notwithstanding the foregoing, if any portion of a Participant’s Award is determined by the Plan Administrator to be includible, by reason of Section 409A of the Code, in a Participant’s or Beneficiary’s income, such portion shall be paid by the Employer (or by the Employers, on an allocated basis determined by the Plan Administrator) to such Participant or Beneficiary. ARTICLE IV Administration of Plan 4.1 Plan Administrator. Except with respect to any authority the Committee retains for itself to act as Plan Administrator with respect to some or all of the Participants and/or some or all of the provisions of the Plan and except as the Committee may otherwise determine, the Plan Administrator shall be either or both of (i) the Executive Vice President-Chief Human Resources and Citizenship Officer as from time to time in office, and his or her delegates, and (ii) the Senior Vice President-Head of Global Total Rewards. The Plan Administrator shall have complete discretionary authority to interpret the Plan and to decide all matters under the Plan, including decisions regarding any claim for benefits under the Plan. Such interpretation and decision shall be final, conclusive and binding on all Participants and any person claiming under or through any Participant, in the absence of clear and convincing evidence that the Plan Administrator acted arbitrarily and capriciously. However, no individual acting, directly or by delegation, as the Plan Administrator may determine his or her own rights or entitlements under the Plan. The Plan Administrator shall establish such rules and procedures, maintain such records and prepare such reports as it considers necessary or appropriate to carry out the purposes of the Plan. The Plan Administrator may delegate to such employees or other persons as it determines such of its duties or responsibilities as it deems appropriate. 6

 
4.2 Outside Services. The Plan Administrator may engage counsel and such clerical, financial, investment, accounting, and other specialized services as the Plan Administrator may deem necessary or appropriate in the administration of the Plan. The Plan Administrator shall be entitled to rely upon any opinions, reports, or other advice furnished by counsel or other specialists engaged for that purpose and, in so relying, shall be fully protected in any action, determination, or omission made in good faith. 4.3 Indemnification. To the extent permitted by law and not prohibited by its charter and by- laws, State Street Corporation will indemnify and hold harmless every person serving (directly or by delegation) as Plan Administrator and the estate of such an individual if he or she is deceased from and against all claims, loss, damages, liability and reasonable costs and expenses incurred in carrying out his or her responsibilities as Plan Administrator, unless due to the gross negligence, bad faith or willful misconduct of such individual; provided, that counsel fees and amounts paid in settlement must be approved by State Street Corporation; and further provided, that this Section 4.3 will not apply to any claims, loss, damages, liability or costs and expenses which are covered by a liability insurance policy maintained by State Street Corporation or by the individual. The provisions of the preceding sentence shall not apply to any corporate trustee, insurance company, investment manager or outside service provider (or to any employee of any of the foregoing) unless the Company otherwise specifies in writing. ARTICLE V Amendment, Modification and Termination 5.1 Amendment; Termination. By action of the Committee or its delegate, the Company reserves the absolute right at any time and from time to time to amend the Plan or any outstanding Award for any purpose which may at the time be permitted by law, and may at any time terminate the Plan; provided that any distributions upon a termination and liquidation of the Plan shall be done in accordance with the requirements of Treas. Regs. § 1.409A-3(j)(4)(ix); provided, further, that except as otherwise expressly provided in the Plan, the Committee may not, without the Participant’s consent, alter the terms of an outstanding Award so as to affect materially and adversely the Participant’s rights under the Award, unless the Committee expressly reserved the right to do so at the time of the Award. In addition, subject to the other provisions of this Section 5.1, the Plan Administrator shall have the authority at any time and from time to time to make amendments to the Plan or outstanding Awards (in general or with respect to one or more individual Participants or Beneficiaries) that do not materially increase the financial obligations of the Company. ARTICLE VI Miscellaneous Provisions 6.1 Source of Payments. All payments hereunder to Participants and their Beneficiaries shall be paid from the general assets of the Company, including for this purpose, if the Company in its sole discretion so determines, assets of one or more trusts established to assist in the payment of benefits hereunder. Any trust established pursuant to the preceding sentence shall provide that trust assets remain subject to the Company’s 7

 
general creditors in the event of insolvency or bankruptcy and shall otherwise contain such terms as are necessary to ensure that they do not constitute a “funding” of the Plan for purposes of the Code. 6.2 No Warranties; No Liability. Neither the Plan Administrator nor any Employer warrants or represents in any way that the value of a Participant’s Award will increase or not decrease. No individual acting as a director, officer, employee or agent of the Company will be liable to a Participant, Beneficiary or any other person for any action, including any Award forfeiture or discretionary action taken pursuant to this Plan, an Award Agreement or any related implementing policy or procedure of the Company. 6.3 Inalienability of Benefits. Except as required by law, no benefit under, or interest in, the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt to do so shall be void. 6.4 Reclassification of Employment Status. Notwithstanding anything herein to the contrary, an individual who is not characterized or treated as a common law employee by an Employer shall not be eligible to participate in the Plan notwithstanding any determination of employee status by the Internal Revenue Service, a court of competent jurisdiction or otherwise. 6.5 Application of Local Law. Participation in the Plan and the issuance and payment of any Award under the Plan shall be subject to any special terms and conditions for the Participant’s country of residence (and country of employment, if different), as may be set forth in an addendum to an Award Agreement or otherwise in writing. The Plan Administrator reserves the right to impose other requirements on participation in the Plan, to the extent the Plan Administrator, in its sole discretion, determines that such other requirements are necessary or advisable in order to comply with local law. To the extent a court or tribunal of competent jurisdiction determines that any provision of the Plan is invalid or unenforceable, in whole or in part, the Plan Administrator, in its sole discretion, shall have the power and authority to revise or strike such provision to the extent necessary to make it and the other provisions of the Plan valid and enforceable to the full extent permitted under local law. In the case of a Participant who is a local national of and employed in a country that is a member of the European Union, the grant of the Award and the terms and conditions governing the Award are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent a court or tribunal of competent jurisdiction determines that any provision of the Award is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make the provision and the Award valid and enforceable to the full extent permitted under local law. 6.6 Expenses. The Employer shall pay all costs and expenses incurred in operating and administering the Plan. 8

 
6.7 No Right of Employment. Nothing contained herein, or any action taken under the provisions hereof, shall be construed as giving any Participant the right to be retained in the employ of an Employer. 6.8 Headings. The headings of the sections in the Plan are placed herein for convenience of reference, and, in the case of any conflict, the text of the Plan, rather than such heading, shall control. 6.9 Construction. The Plan shall be construed, regulated, and administered in accordance with the laws of the Commonwealth of Massachusetts and applicable federal laws. IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized officer on the 20th day of February, 2014. STATE STREET CORPORATION By: /s/ Alison Quirk . Executive Vice President – Chief Human Resources and Citizenship Officer 9

 
FIRST AMENDMENT TO THE STATE STREET CORPORATION SUPPLEMENTAL CASH INCENTIVE PLAN (Effective January 1, 2014) Pursuant to Section 5.1 of the State Street Corporation Supplemental Cash Incentive Plan (the “Plan”), State Street Corporation, acting through the undersigned, its authorized delegate, hereby amends the Plan as follows, effective January 1, 2018: Subparagraph (r) “Restrictive Covenant” of Section 1.3 Definitions is replaced in its entirety with the following: “Restrictive Covenant” means any confidentiality, assignment and disclosure, non- solicitation, non-competition, non-disparagement, post-employment cooperation or notice provision that the Participant agrees to or has agreed to with the Employer, including but not limited to the restrictions contained in the Award Agreement, any employment agreement or offer letter, equity award agreement, change in control employment agreement or required as a condition to entitlement to payment under any executive supplemental retirement plan. Section 6.3 of the Plan, Inalienability of Benefits, is replaced in its entirety with the following: “Transferability of Awards. No benefit under, or interest in, the Plan shall be sold, assigned, transferred, pledged or otherwise encumbered by a Participant, either voluntarily or by operation of law, except by will or the laws of descent and distribution or pursuant to a court issued domestic relations order; provided, however, that, except with respect to a benefit or interest subject to Section 409A, the Committee may permit or provide in an Award for the gratuitous transfer of the Award by the Participant to or for the benefit of any immediate family member, family trust or other entity established for the benefit of the Participant and/or an immediate family member thereof; provided further, that the Company shall not be required to recognize any such permitted transfer until such time as such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument in form and substance satisfactory to the Company confirming that such transferee shall be bound by all of the terms and conditions of the Award. References to a Participant, to the extent relevant in the context, shall include references to authorized transferees. For the avoidance of doubt, nothing contained in this Section 6.3 shall be deemed to restrict a transfer to the Company.” IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized officer this 6th day of February, 2018. STATE STREET CORPORATION By: _/s/ Kathryn M. Horgan_________ Title: _EVP, Chief Human Resources and Citizenship Officer______

 
SECOND AMENDMENT TO THE STATE STREET CORPORATION SUPPLEMENTAL CASH INCENTIVE PLAN (Plan Effective January 1, 2014) Pursuant to Section 5.1 of the State Street Corporation Supplemental Cash Incentive Plan (the “Plan”), State Street Corporation, acting through the undersigned, its authorized delegate, hereby amends the Plan as follows, effective January 1, 2019: Subparagraph (i) “Eligible Employee” of Section 1.3 Definitions is clarified by replacing it in its entirety as follows: “Eligible Employee” means (i) any employee of an Employer (including an officer or director who is also an employee) and (ii) any individual (a) who is no longer an employee of an Employer due to retirement or otherwise, (b) who the Plan Administrator determines, in its discretion, is eligible to receive a cash bonus or other compensation earned while in the employment of an Employer, and (c) whose cash bonus or other compensation the Plan Administrator determines, in its discretion, be paid, in whole or in part, in the form of an Award under this Plan. IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized officer this 19th day of February, 2019. STATE STREET CORPORATION By: _/s/ Kathryn M. Horgan_________ Title: _EVP, Chief Human Resources and Citizenship Officer______

 
STATE STREET CORPORATION SUPPLEMENTAL CASH INCENTIVE PLAN [____] Deferred Value Award Agreement Subject to your acceptance of the terms set forth in this agreement and the addendum attached to it (“Agreement”), your Employer has awarded you, under the State Street Corporation Supplemental Cash Plan (“Plan”), and pursuant to this Agreement and the terms set forth herein, a contingent right to receive cash payments (“Award”) as set forth in the statement pertaining to this Award (“Statement”) on the website (“Website”) maintained by Fidelity Stock Plan Services LLC, an independent service provider based in the United States, or another party designated by the Company (“Award Administrator”). The Plan has been established for the purpose of rewarding, retaining and motivating employees for services and performance during the period from the grant of the Award to the date of the vesting of the Award. In addition to this Award, you may have received a cash bonus under State Street Corporation’s (“Company”) annual incentive plan applicable to you for the [prior year] performance year that was paid or is payable in immediate cash in the first quarter of [current year] (“Immediate Cash Payment”). As set forth below, certain terms and conditions of this Agreement apply to both this Award and your Immediate Cash Payment, if any. You may consider this Agreement for up to thirty (30) days from the date it was first made available to you on the Website. The terms of your Award are as follows: 1. Grant of Award. To be entitled to any payment under this Award, you must accept your Award and in so doing agree to comply with the terms and conditions of this Agreement and the applicable provisions of the Countries Addendum outlined in Appendix A (which is incorporated into, and forms a material and integral part of, this Agreement). Failure to accept this Award within thirty (30) days following the posting of this Agreement on the Website will result in forfeiture of this Award. Copies of the Plan are located on the Website for your reference. Your acceptance of this Award constitutes your acknowledgement that you have read and understood this Agreement, the Plan, and any associated materials. The provisions of the Plan are incorporated herein by reference, and all terms used herein shall have the meaning given to them in the Plan, except as otherwise expressly provided herein. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of the Plan shall control. As used herein, “State Street” means State Street Corporation and each Subsidiary. “Subsidiary” means State Street Corporation’s consolidated subsidiaries. By accepting this Award, you acknowledge and agree that the Award has been granted by the Company, and that any claim you may undertake to raise in the future with respect to this Award may only be raised against the Company in a court of competent jurisdiction in the Commonwealth of Massachusetts, regardless of where or whether you are employed by the Company or a Subsidiary. 1

 
This Award and Immediate Cash Payment are subject to any forfeiture, compensation recovery or similar requirements set forth in this Agreement, as well as any other forfeiture, compensation recovery or similar requirements under applicable law and related implementing regulations and guidance, and to other forfeiture, compensation recovery or similar requirements under plans, policies and practices of the Company or its relevant Subsidiaries in effect from time to time, including those set forth in your offer letter. In the event pursuant to this Agreement or pursuant to any applicable law or related implementing regulations or guidance, or pursuant to any Company or its relevant Subsidiaries plan, policies or practices, the Committee or State Street is required or permitted to reduce, forfeit or cancel any amount remaining to be paid, or to recover any amount previously paid, with respect to this Award or the Immediate Cash Payment, or to otherwise impose or apply restrictions on this Award, it shall, in its sole discretion, be authorized to do so. By accepting this Award, you consent to making payment to your Employer in the event of a compensation recovery determination by the Committee or State Street. 2. General Circumstances of Forfeiture. Any amount remaining to be paid in respect of this Award will be forfeited, if: a. You fail to comply with the terms of the applicable Countries Addendum attached to this Award or the terms of any other Restrictive Covenant you agree to or have agreed to with the Company or a Subsidiary; b. You terminate employment with the Company and its Subsidiaries on a voluntary basis and are not [Retirement Eligible or] Disabled [(for avoidance of doubt, the Plan’s “Retirement Eligible” exception to forfeiture upon termination of employment does not apply to this Award)]; or c. Your employment with the Company and its Subsidiaries is terminated for gross misconduct as determined by the Company or the relevant Subsidiary, in its sole discretion, or the Company or the relevant Subsidiary, in its sole discretion, determines that circumstances prior to the date on which you ceased to be employed by with the Company and its subsidiaries for any reason constituted grounds for termination for gross misconduct. This Section 2 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 3. Material Risk Taker Malus-Based Forfeiture. In the event you hold a title of Senior Vice President or higher during the calendar year in which this Award is made, or you hold the status of “material risk taker” at the time this Award is made or any time thereafter, you acknowledge and agree that this Award is subject to the provisions of this Section 3. In respect of any amount remaining to be paid in respect of this Award may, in the sole discretion of the Committee, be reduced, forfeited or cancelled, in the event that it is determined by the Committee, in its sole discretion, that your 2

 
actions, whether discovered during or after your employment with the Employer, exposed The Business to any inappropriate risk or risks (including where you failed to timely identify, analyze, assess or raise concerns about such risk or risks, including in a supervisory capacity, where it was reasonable to expect you to do so), and such exposure has resulted or could reasonably be expected to result in a material loss or losses that are or would be substantial in relation to the revenues, capital and overall risk tolerance of The Business. “The Business” shall mean State Street, or, to the extent you devote substantially all of your business time to a particular business unit (e.g., Global Services Americas, Global Services International, State Street Global Exchange or State Street Sector Solutions) or business division (e.g., Alternative Investment Solutions, Securities Lending), “Business” shall refer to such business unit or business line. This provision applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 4. Identified Staff Malus-Based Forfeiture and Clawback. a. In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated Identified Staff for purposes of the PRA Remuneration Code, you acknowledge and agree that both this Award and the Immediate Cash Payment are subject to the provisions of this Section 4 for a period of seven (7) years from the date this Award is granted. The seven (7)-year period may be extended to ten (10) years in certain circumstances where (i) the Company has commenced an investigation into facts or events which it considers could potentially lead to the application of a clawback under this Section 4 were it not for the expiration of the seven (7)-year period; or (ii) the Company has been notified by a regulatory authority that an investigation has commenced into facts or events which the Company considers could potentially lead to the application of clawback by the Company under this Section 4 were it not for the expiration of the seven (7)-year period. b. If the Company determines that a PRA Forfeiture Event has occurred it may elect to reduce, forfeit or cancel all or part of any amount remaining to be paid in respect of this Award (“PRA Malus-Based Forfeiture”). c. If the Company determines that a PRA Clawback Event has occurred it may require the repayment by you (or otherwise seek to recover from you) of all or part of the cash delivered to you in respect of this Award or the Immediate Cash Payment. d. The Company may produce guidelines from time to time in respect of its operation of the provisions of this Section 4. The Company intends to apply such guidelines in deciding whether and when to effect any reduction, forfeiture, cancellation or recovery of compensation but, in the event of any inconsistency between the provisions of this Section 4 and any such guidelines, this Section 4 shall prevail. Such guidelines do not form part of any employee’s contract of 3

 
employment, and the Company may amend such guidelines and their application at any time. e. By accepting this Award on the Website, you expressly and explicitly: i. consent to making the required payment to the Company (or to your Employer on behalf of the Company) upon a PRA Clawback Event and ii. authorize the Company to issue related instructions, on your behalf, to the Award Administrator and any brokerage firm and/or third party administrator engaged by the Company to administer the Award to re-convey, transfer or otherwise return to the Company any amount paid under the Award. f. For the purposes of this Section 4: i. A “PRA Forfeiture Event” means a determination by the Company, in its sole discretion, that (A) there is reasonable evidence of your misbehavior or material error; or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material downturn in its financial performance; or (C) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management; ii. A “PRA Clawback Event” means a determination by the Company, in its sole discretion, that either (A) there is reasonable evidence of your misbehavior or material error or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management. g. This Section 4 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 5. SSB Intl GmbH and SSGA GmbH Affordability Limitations, Malus-Based Forfeiture and Clawback. a. Awards issued to SSB Intl GmbH or State Street Global Advisors GmbH staff may be impacted by the financial situation of the bank and/or regulatory group, as prescribed by regulatory requirements in its applicable version (e.g. the Remuneration Ordinance for Institutions and/or German Banking Act). Awards may also be limited to the extent ordered by the competent supervisory authority according to sec. 45 para. 2 sentence 1 no. 5a, 6 German Banking Act. Further, entitlement to an Award may lapse if the competent supervisory authority issues a corresponding definitive order according to sec. 45 para. 5 sentence 5 to 8 German Banking Act. b. In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated SSB Intl GmbH Identified Staff for purposes of the German Remuneration Ordinance, you acknowledge and agree that this 4

 
Award is subject to forfeiture and clawback for a period from the date the Award is granted until two (2) years from the date that the final tranche of this Award vests. A clawback applies if you, as SSB Intl GmbH Identified Staff, (i) contributed significantly to, or was responsible for, conduct that resulted in significant losses or regulatory sanctions for SSB Intl GmbH, or (ii) is responsible for a serious breach of relevant external or internal rules on good conduct (“SSB Intl GmbH Identified Staff Clawback Event”). c. Section 5 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 6. Management Committee/Executive Vice President Forfeiture and Clawback. a. If, at the time the Award is made, you are a member of the State Street Corporation Management Committee or any successor committee or body (“Management Committee” or “MC”) or hold the title Executive Vice President (“EVP”) or higher, any amount remaining to be paid in respect of this Award may, in the sole discretion of the Committee, be reduced, forfeited or cancelled, in whole or in part, in the event that it is determined by the Committee, in its sole discretion, that: i. you engaged in fraud, gross negligence or any misconduct, including in a supervisory capacity, that was materially detrimental to the interests or business reputation of State Street or any of its businesses; or ii. you engaged in conduct that constituted a violation of State Street policies and procedures or State Street Standard of Conduct in a manner which either caused or could have caused reputational harm that is material to State Street or placed or could have placed State Street at material legal or financial risk; or iii. as a result of a material financial restatement by State Street contained in a filing with the U.S. Securities and Exchange Commission (“SEC”), or miscalculation or inaccuracy in the determination of performance metrics, financial results or other criteria used in determining the amount of this Award, you would have received a smaller or no Award hereunder. b. If, at the time the Award is made, you are a member of the Management Committee or hold the title EVP or higher, this Award and the Immediate Cash Payment also are subject to compensation recovery as provided herein. Upon the occurrence of an MC/EVP Clawback Event within three (3) years (within one (1) year for an EVP) after the date of grant of this Award, the Committee may, in its sole discretion, determine to recover the MC/EVP Clawback Amount, in whole or in part. Following such a determination, you agree to immediately repay such compensation in cash no later than sixty (60) days following such determination. 5

 
To the extent not prohibited by applicable law and subject to compliance with Section 409A of the Code, if you fail to comply with any requirement to repay compensation under this Section 6, the Committee may determine, in its sole discretion, in addition to any other remedies available to the Company, that you will satisfy your repayment obligation through an offset to any future payments owed by the Company or any of its Subsidiaries to you. c. For purposes of this Section 6: i. “MC/EVP Clawback Event” means a determination by the Committee, in its sole discretion, (A) with respect to any event or series of related events that you engaged in fraud or willful misconduct, including in a supervisory capacity, that resulted in financial or reputational harm that is material to State Street and resulted in the termination of your employment by the Company and its Subsidiaries (or, following a cessation of your employment for any other reason, such circumstances constituting grounds for termination are determined applicable) or (B) a material financial restatement or miscalculation or inaccuracy in financial results, performance metrics, or other criteria used in determining this Award by State Street occurred. For the avoidance of doubt and as applicable, an MC/EVP Clawback Event includes any determination by the Committee that is based on circumstances prior to the date on which you cease to be employed by the Company and its Subsidiaries for any reason, even if the determination by the Committee occurs after such cessation of employment. ii. “MC/EVP Clawback Amount” means (A) with respect to an MC/EVP Clawback Event described in Section 6(c)(i)(A), the amount of the Immediate Cash Payment plus the amount of the cash payments, if any, that were delivered to you under this Award by the Company during the period of three (3) years (one (1) year for an EVP) immediately prior to such MC/EVP Clawback Event or (B) with respect to an MC/EVP Clawback Event described in Section 6(c)(i)(B), the amount of the Immediate Cash Payment plus the amount of the cash payments, if any, that were delivered to you under this Award by the Company (x) during the period of three (3) years (one (1) year for an EVP) immediately prior to an associated date designated by the Committee and (y) that represents an amount that, in the sole discretion of the Committee, exceeds the amount you would have been awarded as the Immediate Cash Payment and under this Award had the financial statements or other applicable records of State Street been accurate (reduced, in the case of both of the immediately preceding clauses (A) and (B), taking into account any portion of the Immediate Cash Payment and this Award that was previously recovered by the Company under this Section 6(b) to avoid a greater than 100% recovery). d. In connection with any MC/EVP Clawback Event, you hereby expressly and explicitly authorize the Company to issue instructions, on your behalf, to the Award Administrator and any brokerage firm and/or third party administrator 6

 
engaged by the Company to administer the Award, to re-convey, transfer or otherwise return such Award proceeds and/or other amounts to the Company. e. This Section 6 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 7. Payment and Tax Withholding. Payment will be made as soon as feasible on or after the vesting date, and in any event within thirty (30) days following the vesting date. Federal, state and local taxes will be withheld as required by law and the net remaining value will be delivered as USD cash into the default cash fund in your individual Award Administrator account. The default cash fund in your individual Award Administrator account pays interest at prevailing rates and can be sold at any time. 8. Employee Rights. Nothing in this Award shall be construed to guarantee you any right of employment with the Company, your Employer or any Subsidiary or to limit the discretion of any of them to terminate your employment at any time, with or without cause to the maximum extent permitted under local law. In consideration of the grant of the Award, you acknowledge and agree that you will have no entitlement to compensation or damages in consequence of the termination of your Employment (for any reason whatsoever and whether or not in breach of contract or local labor laws), insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Award as a result of such termination, or from the loss or diminution in value of the Award. By accepting this Award, you shall be deemed irrevocably to have waived any such claim or entitlement against the Company, your Employer and all Subsidiaries that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by accepting this Agreement, you shall be deemed irrevocably to have waived your entitlement to pursue such claim. In the event your Employment ends and you are subsequently rehired by the Company or any Subsidiary, no Award previously forfeited or recovered will be reinstated. 9. Non-Transferability, Etc. This Award shall not be transferable other than (1) by will or the laws of descent and distribution or (2) pursuant to the terms of a court-approved domestic relations order, official marital settlement agreement or other divorce or settlement instrument satisfactory to State Street, in its sole discretion. In the case of transfer pursuant to (2) above, this Award shall remain subject to all the terms and conditions contained in the Plan and this Agreement, including vesting, forfeiture and clawback terms and conditions. Any attempt by you (or in the case of your death, by your Designated Beneficiary) to assign or transfer this Award, either voluntarily or involuntarily, contrary to the provisions hereof, shall be null, void and without effect and shall render this Award itself null and void. 7

 
10. Compliance with Section 409A of the Code. a. The provisions of this Award are intended to be exempt from, or compliant with, Section 409A of the Code, and shall be construed and interpreted consistently therewith. Notwithstanding the foregoing, neither the Company nor any Subsidiary shall have any liability to you or to any other person if this Award is not so exempt or compliant. b. If and to the extent i. any portion of any payment, compensation or other benefit provided to you pursuant to the Plan in connection with your employment termination constitutes “nonqualified deferred compensation” within the meaning of Section 409A of the Code, and ii. you are a specified employee as defined in Section 409A(a)(2)(B)(i) of the Code, in each case as determined by the Company in accordance with its procedures, by which determinations you (through accepting this Award) agree that you are bound, such portion of the payment, compensation or other benefit shall not be paid before the day that is six months plus one day after the date of “separation from service” (as determined under Section 409A of the Code) (the “New Payment Date”), except as Section 409A of the Code may then permit. The aggregate of any payments that otherwise would have been paid to you during the period between the date of separation from service and the New Payment Date shall be paid to you in a lump sum on such New Payment Date, and any remaining payments will be paid on their original deferral schedule. 11. Miscellaneous. a. Awards Discretionary. By accepting this Award, you acknowledge and agree that the Plan is discretionary in nature and limited in duration, and may be amended, forfeited, cancelled, or terminated by the Company, in its sole discretion, at any time. The grant of this Award is a one-time benefit and does not create any contractual or other right to receive an award, compensation or benefits in lieu of an award in the future. Future awards, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of an award, the amount of cash subject to an award, and forfeiture, clawback and vesting provisions. b. Company and Committee Discretion. Sections 2 through 6 of this Agreement are intended to comply with and meet the requirements of applicable law and related implementing regulations regarding incentive compensation and will be interpreted and administered accordingly as well as in accordance with any implementing policies and practices of the Company or its relevant Subsidiaries in effect from time to time. In making determinations under such Sections, the Company, the relevant Subsidiary or the Committee, as applicable, may take into account, in its sole discretion, all factors that it deems appropriate or relevant. Furthermore, the Company, the relevant Subsidiary or the Committee may, as applicable, take any and all actions it deems necessary or appropriate in its sole 8

 
discretion, as permitted by applicable law, to implement the intent of Sections 2 through 6, including suspension of vesting and payment pending an investigation or the determination by the Company, the relevant Subsidiary or the Committee, as applicable. Each such Section is without prejudice to the provisions of the other Sections, and the Company, the relevant Subsidiary or the Committee, as applicable, may elect or be required to apply any or all of the provisions of Sections 2 through 6 to this Award and, where applicable, to the Immediate Cash Payment. Sections 2 through 6 of this Agreement shall cease to apply upon your death at any time provided, however, if a PRA Clawback Event, SSB Intl GmbH Identified Staff Clawback Event or an MC/EVP Clawback Event has occurred pursuant to Section 4, 5, or 6, respectively, at or prior to your death, any amount that the Committee has made a determination to recover under either such Section shall continue to be payable to the Company. c. Voluntary Participation. Your participation in the Plan is voluntary. The value of this Award is an extraordinary item of compensation, is outside the scope of your employment contract, if any, and is not part of your normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments. d. Electronic Delivery. The Company or any of its Subsidiaries may, in its sole discretion, decide to deliver any documents related to the Award by electronic means. You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system, including the Website, established and maintained by the Company, any of its Subsidiaries, the Award Administrator or another party designated by the Company. e. Electronic Acceptance. By accepting this Award electronically, i. you acknowledge and agree that you are bound by the terms of this Agreement and the Plan and that you and this Award are subject to all of the rights, power and discretion of the Company, its Subsidiaries and the Committee set forth in this Agreement and the Plan; and ii. this Award is deemed accepted by the Company and the Company shall be deemed to be bound by the terms of this Agreement. f. Language. You acknowledge and agree that it is your express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to this Award, be drawn up in English. If you have received this Agreement, the Plan or any other documents related to this Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will prevail to the extent permitted under local law. France: Une version 9

 
française de cet Accord peut être consultée sur l’intranet. Poland: Kopię tej Umowy w języku polskim może Pan/Pani otrzymać wchodząc na Stronę. g. Additional Requirements. The Company reserves the right to impose other requirements on this Award, and your participation in the Plan, to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local laws, rules and regulations, or to facilitate the operation and administration of this Award and the Plan. Such requirements may include (but are not limited to) requiring you to sign any agreements or undertakings that may be necessary to accomplish the foregoing. Further, a grant of an Award hereunder is subject to compliance by the Company and you with all legal requirements applicable thereto, including compliance with the requirements of 12 C.F.R. Part 359. h. Public Offering. If you are a resident and/or employed outside the United States, the grant of this Award is not intended to be a public offering of securities in your country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law), and the grant of this Award is not subject to the supervision of the local securities authorities. i. Limitation of Liability. No individual acting as a director, officer, employee or agent of the Company or any of its Subsidiaries will be liable to you or any other person for any action, including any Award forfeiture, Award recovery or other discretionary action taken pursuant to this Agreement or any related implementing policy or procedure of the Company. j. Exchange Rates. Neither the Company, your Employer or any Subsidiary shall be liable for any foreign exchange rate fluctuation, where applicable, between your local currency and the United States dollar that may affect the value of an Award or of any amounts due to you under this Agreement. k. Notional Investments. 100% of the Award will be allocated to and will be treated as though notionally invested in the State Street Institutional U.S. Government Money Market Fund. The earnings credited will vary based on the actual performance of the money market; however, there is no ownership interest in the Money Market Fund or any other actual investment. Earnings, if any, will generally result in the credit of additional notional units as the Money Market Fund is managed to a $1.00 USD unit share price. Past performance is no guarantee of future performance and the fund unit value can decline below $1.00 USD. The administration of earnings shall be subject to procedures approved by the Plan Administrator. The Plan Administer may at any time substitute a new fund or other notional tracking option for the Money Market Fund, including with respect to balances already notionally invested under the Plan. You acknowledge and agree, on your behalf and on behalf of your Beneficiaries, that none of the Company or its agents or representatives shall be liable for any losses or 10

 
damages of any kind, including notional investment losses, relating to the allocation of the Award to the Money Market Fund or any other notional investment under the Plan. l. Applicable Law. This Agreement shall be subject to and governed by the laws of the Commonwealth of Massachusetts, United States of America without regard to that Commonwealth’s conflicts of law principles. 12. Application of Local Law and Countries Addendum. a. Notwithstanding Section 11(l), this Award shall be subject to all applicable laws, rules and regulations of your country of residence (and country of employment, if different) and any special terms and conditions for your country of residence (and country of employment, if different), including as set forth in the addendum that immediately follows this Agreement (“Countries Addendum”), but limited to the extent required by local law. The Company reserves the right, in its sole discretion, to add to or amend the terms and conditions set out in the Countries Addendum as necessary or advisable in order to comply with applicable laws, rules and regulations or to facilitate the operation and administration of this Award and the Plan, including (but not limited to) circumstances where you transfer residence and/or Employment to another country. b. As a condition to this Award, you agree to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in your country of residence (and country of employment, if different). In addition, you also agree to take any and all actions, and consent to any and all actions taken by the Company and its Subsidiaries, as may be required to allow the Company and its Subsidiaries to comply with local laws, rules and regulations in your country of residence (and country of employment, if different). Finally, you agree to take any and all actions as may be required to comply with your personal legal, tax and other obligations under local laws, rules and regulations in your country of residence (and country of employment, if different). 13. Data Privacy. The Company is located at One Lincoln Street, Boston, Massachusetts, U.S.A. and grants Awards under the Plan to employees of the Company and its Subsidiaries in its sole discretion. You should carefully review the following information about the Company’s data privacy practices in relation to your Award. a. Data Collection, Processing and Usage. Pursuant to applicable data protection laws, you are hereby notified that the Company and your Employer collect, process and use certain personal data about you for the legitimate interest of implementing, administering and managing the Plan and generally administering Awards; specifically, including your name, home address, email address and telephone number, date of birth, social security number, social insurance number or other identification number, salary, citizenship, job title, any shares of Common Stock or directorships held in the Company, and details of 11

 
all Awards or any other incentive compensation awards granted, canceled, forfeited, exercised, vested, or outstanding in your favor, which the Company receives from you or your Employer. In granting Awards under the Plan, the Company will collect your personal data for purposes of allocating Awards and implementing, administering and managing the Plan. The Company’s collection, processing and use of your personal data is necessary for the performance of the Company’s contractual obligations under the Plan and pursuant to the Company’s legitimate interest of managing and generally administering employee incentive compensation awards. Your refusal to provide personal data would make it impossible for the Company to perform its contractual obligations and may affect your ability to participate in the Plan. As such, by participating in the Plan, you voluntarily acknowledge the collection, processing and use of your personal data as described herein. b. Award Administrator. The Company transfers your personal data to the Award Administrator, which assists the Company with the implementation, administration and management of the Plan. In the future, the Company may select a different Award Administrator and share your personal data with another company that serves in a similar manner. The Award Administrator will open an account to credit your Award, including any amounts that ultimately vest under the Plan. You will be asked to agree on separate terms and acknowledge data processing practices with the Award Administrator, which is a condition to your ability to participate in the Plan. c. Data Retention. The Company will use your personal data only as long as is necessary to implement, administer and manage your participation in the Plan or as required to comply with legal or regulatory obligations, including under tax and security laws. When the Company no longer needs your personal data, the Company will remove it from its systems. If the Company keeps your data longer, it would be to satisfy legal or regulatory obligations and the Company’s legal basis would be for compliance with relevant laws or regulations. For further information about the processing of your personal data, please see the GHR Privacy Notice. ********************************** APPENDIX A COUNTRIES ADDENDUM TO [____] DEFERRED VALUE AWARD AGREEMENT STATE STREET CORPORATION SUPPLEMENTAL CASH INCENTIVE PLAN A. United States 12

 
B. Australia C. Brazil D. Canada E. France F. Germany G. Hong Kong H. Ireland I. Luxembourg J. Netherlands K. Poland L. United Kingdom A. UNITED STATES ____________________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with the Company and its Subsidiaries. Failure to comply with the terms and conditions of this Countries Addendum A may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. In addition, your eligibility to participate in the Plan in the future, including any potential future grants of awards under the Plan (or any successor incentive plan of the Company), is subject to and conditioned on your compliance with the terms and conditions of this Countries Addendum A. This Countries Addendum A contains a covenant not to compete in Paragraph 5 which shall apply to you at any time that you hold the title of Executive Vice President or higher. You should review it carefully. You may consult with an attorney before accepting the Award. You may consider whether you wish to accept the Award for up to 30 days from the date it was first made available to you on the Website. By accepting the Award, you acknowledge and agree that it is fair and adequate consideration for the covenant not to compete and other promises you make in this Countries Addendum. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Confidentiality. (a) You acknowledge that you have access to Confidential Information which is not generally known or made available to the general public and that such Confidential Information is the property of the Company, its Subsidiaries or its or their licensors, suppliers or customers. Subject to Paragraph 16, below, you agree specifically as follows, in each case whether during your Employment or following the termination thereof: (i) You will always preserve as confidential all Confidential Information, and will never use it for your own benefit or for the benefit of others; this includes that you will not use the knowledge of activities or positions in clients’ securities portfolio accounts or cash accounts for your own personal gain or for the gain of others. 13

 
(ii) You will not disclose, divulge, or communicate Confidential Information to any unauthorized person, business or corporation during or after the termination of your Employment with the Company and its Subsidiaries. You will use your best efforts and exercise due diligence to protect, to not disclose and to keep as confidential all Confidential Information. (iii) You will not initiate or facilitate any unauthorized attempts to intercept data in transmission or attempt entry into data systems or files. You will not intentionally affect the integrity of any data or systems of the Company or any of its Subsidiaries through the introduction of unauthorized code or data, or through unauthorized deletion or addition. You will abide by all applicable Corporate Information Security procedures. (iv) Upon the earlier of request or termination of Employment, you agree to return to the Company or the relevant Subsidiaries, or if so directed by the Company or the relevant Subsidiaries, destroy any and all copies of materials in your possession containing Confidential Information. (b) The terms of this Countries Addendum A do not apply to any information which is previously known to you without an obligation of confidence or without breach of this Countries Addendum A, is publicly disclosed (other than by a violation by you of the terms of this Countries Addendum A) either prior to or subsequent to your receipt of such information, or is rightfully received by you from a third party without obligation of confidence and other than in relation to your Employment with the Company or any of its Subsidiaries. State Street recognizes that certain disclosures of confidential information to appropriate government authorities or other designated persons are protected by “whistleblower” and other laws. Nothing in this Countries Addendum A is intended to or should be understood or construed to prohibit or otherwise discourage such disclosures. State Street will not tolerate any discipline or other retaliation against employees who properly make such legally-protected disclosures. 2. Assignment and Disclosure. (a) You acknowledge that, by reason of being employed by your Employer, to the extent permitted by law, all works, deliverables, products, methodologies and other work product conceived, created and/or reduced to practice by you, individually or jointly with others, during the period of your Employment by your Employer and relating to the Company or any of its Subsidiaries or demonstrably anticipated business, products, activities, research or development of the Company or any of its Subsidiaries or resulting from any work performed by you for the Company or any of its Subsidiaries, including, without limitation, any track record with which you may be associated as an investment manager or fund manager (collectively, “Work Product”), that consists of copyrightable subject matter is "work made for hire" as defined in the Copyright Act of 1976 (17 U.S.C. § 101), and such copyrights are therefore owned, upon creation, exclusively by State Street. To the extent the foregoing does not apply and to the extent permitted by law, you hereby assign and agree to assign, for no additional consideration, all of your rights, title and interest in any Work Product and any intellectual property rights therein to State Street. You hereby waive in favor of State Street any and all artist’s or moral rights (including without limitation, all rights of integrity and attribution) you may have pursuant to any state, federal or foreign laws, rules or regulations in respect of any Work Product and all similar rights thereto. You will not pursue any ownership or other interest in such Work Product, including, without limitation, any intellectual property rights. 14

 
(b) You will disclose promptly and in writing to the Company or your Employer all Work Product, whether or not patentable or copyrightable. You agree to reasonably cooperate with State Street (i) to transfer to State Street the Work Product and any intellectual property rights therein, (ii) to obtain or perfect such rights, (iii) to execute all papers, at State Street’s expense, that State Street shall deem necessary to apply for and obtain domestic and foreign patents, copyright and other registrations, and (iv) to protect and enforce State Street’s interest in them. (c) These obligations shall continue beyond the period of your Employment with respect to inventions or creations conceived or made by you during the period of your Employment. 3. Non-Solicitation. (a) This Paragraph 3 shall apply to you at any time that you hold the title of Vice President or higher. (b) You agree that, during your Employment and for a period of six (6) months from the date your Employment terminates for any reason you will not, without the prior written consent of the Company or your Employer: (i) solicit, directly or indirectly (other than through a general solicitation of employment not specifically directed to employees of the Company or any of its Subsidiaries), the employment of, hire or employ, recruit, or in any way assist another in soliciting or recruiting the employment of, or otherwise induce the termination of the employment of, any person who then or within the preceding twelve (12) months was an officer of the Company or any of its Subsidiaries (excluding any such officer whose employment was involuntarily terminated); or (ii) engage in the Solicitation of Business from any Client on behalf of any person or entity other than the Company or any of its Subsidiaries. (c) Paragraph 3(b)(i) above shall be deemed to exclude the words “hire or employ” if your work location is in California or New York, and shall be construed and administered accordingly. (i) For purposes of this Paragraph 3, “officer” shall include any person holding a position title of Assistant Vice President or SSGA Principal 4 or higher. Notwithstanding the foregoing, this Paragraph 3 shall be inapplicable following a Change in Control. 4. Notice Period Upon Resignation. (a) This Paragraph 4 shall apply to you at any time that you hold the title of Managing Director or higher (or, any time that you hold the title of Vice President or higher in State Street Global Markets (“SSGM”)). If you are subject to an employment agreement that requires a longer notice period, that employment agreement shall govern. (b) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance 15

 
notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (i) if you are a member of the Management Committee, you will give 180 days’ advance notice; (ii) if you are an Executive Vice President or higher, you will give ninety (90) days’ advance notice; (iii) if you are a Vice President in SSGM, you will give thirty (30) days’ advance notice; and (iv) otherwise, you will give sixty (60) days’ advance notice. (c) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. (d) In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (e) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits (although you may not be eligible for any new incentive compensation awards or, subject to applicable law, to accrue any paid vacation time), and shall continue to comply with the applicable policies of your Employer, the Company and its Subsidiaries. (e) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 4, your Employer, the Company or any of its Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for a period equal to the period for which notice of resignation was required but not provided, and for the period of restriction under Paragraph 5, if applicable, in addition to any other remedies available under law. (f) If you have sixty (60) or fewer days’ notice remaining in your required Notice Period under this Paragraph 4, your Employer, or the Company, or any of its Subsidiaries may, at any time during the remainder of your Notice Period, release you from your obligations under this Paragraph 4 and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum A. (g) Notwithstanding the foregoing, if you hold the title of Executive Vice President or higher this Paragraph 4 shall not apply in the event you terminate your Employment for Good Reason on or prior to the first anniversary of a Change in Control (each as defined in the Plan). 5. Non-Competition. (a) This Paragraph 5 shall apply to you at any time that you hold the title of Executive Vice President or higher, except as provided below. You should review it carefully and may, if you wish, consult with an attorney before accepting this Award. (b) During your Employment and for the twelve (12) months following its termination for any reason (the “Non-Compete Period”), you will not, anywhere in the Restricted Area, for yourself or any other person or entity, directly or indirectly, in any Restricted Capacity, engage in, provide services to, consult for, or be employed by a business that provides products or services competitive with any products or services of your Employer, the Company or any of its 16

 
Subsidiaries with respect to which you were involved at any time during your Employment or, with respect to the portion of the Non-Compete Period that follows termination of your Employment, within the two years preceding the date of the termination of your #Employment. (c) If you reside in or have a primary reporting location in California, then this Paragraph 5 applies only during your Employment, but has no effect after the termination of your Employment for any reason. (d) If you reside in or are employed in Massachusetts and State Street terminates your employment involuntarily not for cause, then this Paragraph 5 applies only during your Employment, but has no effect after such termination. Here, “cause” means (i) your Employer’s or the Company’s good faith determination that it has a reasonable basis for dissatisfaction with your Employment for reasons such as lack of capacity or diligence, failure to conform to usual standards of conduct, or other culpable or inappropriate behavior or (ii) other grounds for discharge that are reasonably related, in your Employer’s or the Company’s honest judgment, to the needs of the business of your Employer, the Company or any of its Subsidiaries. In addition, if you violate a fiduciary duty to your Employer, the Company or any of its Subsidiaries, then the post- employment portion of the Non-Compete Period shall be extended by the time during which you engage in such activities, for up to a total of 2 years following termination of your Employment. (e) “Restricted Area” means anywhere that your Employer, the Company or any of its Subsidiaries markets its products or services (which you acknowledge specifically includes the entire world), or with respect to the portion of the Non-Compete Period that follows termination of your Employment, anywhere in which you provided services or had a material presence or influence on behalf of your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination. (f) “Restricted Capacity” means any capacity, or with respect to the portion of the Non-Compete Period that follows termination of your Employment, any capacity that is the same or similar to the capacity in which you were employed by your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination and/or involves any services that you provided to your Employer, the Company or any of its Subsidiaries at any time within such 2-year period. 6. Definitions. For the purpose of this Countries Addendum A, the following terms are defined as follows: (a) “Client” means a prospective, present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve (12) months prior to the date your Employment with your Employer ends. (b) “Confidential Information” includes but is not limited to all trade secrets, trade knowledge, systems, software, code, data documentation, files, formulas, processes, programs, 17

 
training aids, printed materials, methods, books, records, client files, policies and procedures, client and prospect lists, employee data and other information relating to the operations of the Company or any of its Subsidiaries and to its or any of their customers, and any and all discoveries, inventions or improvements thereof made or conceived by you or others for the Company or any of its Subsidiaries whether or not patented or copyrighted, as well as cash and securities account transactions and position records of clients, regardless of whether such information is stamped “confidential.” (c) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (d) “Solicitation of Business” means the attempt through direct or indirect contact by you or by any other Person with your assistance to induce a Client to: (i) transfer the Client’s business from the Company or any of its Subsidiaries to any other person or entity; (ii) cease or curtail the Client’s business with the Company or any of its Subsidiaries; or (iii) divert a business opportunity from the Company or any of its Subsidiaries to any other person or entity, which business or business opportunity concerns or relates to the business with which you were actively connected during your Employment with the Company or any of its Subsidiaries. (e) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 7. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum A is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. 8. Non-Disparagement. Subject to Paragraph 16, below, you agree that during your Employment and following the termination thereof you shall not make any false, disparaging, or derogatory statements to any media outlet (including Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry groups, financial institutions, or to any current, former or prospective employees, consultants, clients, or customers of the Company or its Subsidiaries regarding the Company, its Subsidiaries or any of their respective directors, officers, employees, agents, or representatives, or about the business affairs or financial condition of the Company or any of its Subsidiaries. 9. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum A are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and goodwill, and are material and integral to the 18

 
undertakings of the Company under this Award to which this Countries Addendum A is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such promises in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled. You further agree that, the periods of restriction contained in this Countries Addendum A shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum A, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. Should the Company determine that any portion of this Award are to be forfeited on account of your breach of the provisions of this Countries Addendum A, any unvested portion of your Award will cease to vest upon such determination. 10. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum A shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 11. Relationship to Other Agreements. This Addendum A supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 12. Interpretation of Business Protections. The agreements made by you in Paragraphs 1, 2, 3, 4 and 5 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum A is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum A is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 13. Assignment. Except as provided otherwise herein, this Countries Addendum A shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 14. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum A, and it shall be deemed to have been accepted by the Company. You agree that this electronic acceptance by both you and the Company shall be deemed equivalent to the Award having been signed by both parties. 19

 
15. Notification Requirement. Until forty-five (45) days after the period of restriction under Paragraph 5 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least five (5) business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum A. 16. Certain Limitations. (a) Nothing in this Countries Addendum A prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum A requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any Confidential Information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. You shall not be held criminally or civilly liable under any Federal or State trade secret law if you disclose a Company trade secret (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, solely for the purposes of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * * * Entire Agreement. The Plan and the Agreement constitute the complete understanding and agreement between the parties to the Agreement with respect to this Award, and supersedes and cancels any previous oral or written discussions, agreements or representations regarding this Award. 20

 
B. AUSTRALIA ____________________________________________________________________________ 1. Tax Deferral. This Award is intended to be subject to tax deferral under Subdivision 83A-C of the Income Tax Assessment Act 1997 (subject to the conditions and requirements thereunder). 2. Attached Offer Document. The terms of your Award incorporate the rules of the Plan, the Agreement, this Countries Addendum and the provisions of the attached Offer Document. The Offer Document is hereby incorporated into, and forms an integral and material part of, the Agreement and this Countries Addendum. By accepting your Award, you will be bound by the rules of the Plan, the Agreement, this Countries Addendum and the attached Offer Document. 3. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title of Executive Vice President or higher immediately prior to termination of your Employment, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice in writing; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice in writing. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its 21

 
Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any remaining portion of the Notice Period; provided that such action shall not affect your other obligations under this Addendum. b) Non-Competition. i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co-venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. iii) The period of 12 months referred to in Paragraph 3(b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. iv) Nothing in this Paragraph (b) shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. c) Definitions. For the purpose of this Clause 3, the following terms are defined as follows: i) “Client” means a current or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which the Company or any 22

 
of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. e) Enforcement. You acknowledge and agree that the promises contained in this Clause 3 are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in 23

 
securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. h) Interpretation of Business Protections. The agreements made by you in Paragraphs 3(a) and 3(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Addendum is severable and independently enforceable without reference to the enforcement of any other provision. Consistent with the Restraint of Trade Act 1976 (NSW), if any restriction set forth in this Clause 3 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. i) Assignment. Except as provided otherwise herein, this Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Addendum, and it shall be deemed to have been accepted by the Company. k) Notification Requirement. During the period of restriction under Paragraph 3(b) above and for a further 45 days after that period of restriction has expired, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Addendum. l) Certain Limitations i) Nothing in this Addendum prohibits you from reporting possible violations of United States federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower 24

 
provisions of United States federal law or regulation. Moreover, nothing in this Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. C. Brazil ____________________________________________________________________________ 1. Compliance with Law. By accepting the Award, you expressly acknowledge and agree to comply with applicable Brazilian laws and to pay any and all applicable taxes associated with the vesting of the Award and the receipt of any associated earnings. 2. Labor Law Acknowledgment. You expressly acknowledge and agree that, for all legal purposes, (a) the benefits provided pursuant to the Agreement and the Plan are the result of commercial transactions unrelated to your employment; (b) the Agreement and the Plan are not a part of the terms and conditions of your employment; and (c) the income you realize from the Award, if any, is not part of your remuneration from employment. BY ELECTRONICALLY ACCEPTING THE AGREEMENT AND THIS COUNTRIES ADDENDUM, YOU ACKNOWLEDGE, UNDERSTAND AND AGREE TO THE TERMS AND CONDITIONS OF THE PLAN, YOUR AGREEMENT AND THIS COUNTRIES ADDENDUM. D. CANADA ____________________________________________________________________________ 1. Use of English Language. The following provision will apply if you are a resident of Quebec: 25

 
You acknowledge and agree that it is your express wish that the Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English. In French: Vous reconnaissez et consentez que c’est votre souhait exprès qui cet accord, de même que tous documents, toutes notifications et tous procédés légaux est entré dans, donné ou instituté conformément ci-annexé ou relatant directement ou indirectement ci-annexé, est formulé dans l’anglais. Une version française de cet Accord peut être consultée sur l’intranet. E. FRANCE ____________________________________________________________________________ 1. French Language Version. You may obtain a copy the Agreement in French on the Fidelity Website. In French: Une version française de cet Accord peut être consultée sur l’intranet. F. GERMANY ____________________________________________________________________________ 1. Subsection (a) of Section 2 General Circumstances of Forfeiture shall not apply to an Award subject to this Agreement. G. HONG KONG ____________________________________________________________________________ 1. IMPORTANT NOTICE. WARNING: The contents of the Agreement, this Countries Addendum, the Plan, and all other materials pertaining to this Award and/or the Plan have not been reviewed by any regulatory authority in Hong Kong. You are hereby advised to exercise caution in relation to the offer thereunder. If you have any doubts about any of the contents of the aforesaid materials, you should obtain independent professional advice. 2. Nature of the Plan. The Company specifically intends that the Plan will not be treated as an occupational retirement scheme for purposes of the Occupational Retirement Schemes Ordinance (“ORSO”). To the extent any court, tribunal or legal/regulatory body in 26

 
Hong Kong determines that the Plan constitutes an occupational retirement scheme for the purposes of ORSO, the grant of Awards shall be null and void. 3. Award Benefits Are Not Wages. This Award does not form part of your wages for purposes of calculating any statutory or contractual payments under Hong Kong Law. 4. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. (3) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. (iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Section 4 by giving immediate effect to your resignation and making a payment in lieu of any notice due; 27

 
provided that such action shall not affect your other obligation under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher. (ii) During your Employment and for the 6 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co-venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 6 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph (ii) above. (iv) Nothing in this Paragraph (b)(iv) shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a present or former customer or client of your Employer, the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which your Employer, the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. 28

 
(iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 4(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with your Employer, you will reasonably cooperate with your Employer, the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). Your Employer, the Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of this Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries 29

 
in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs 4(a) and 4(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by your Employer and the Company. (k) Notification Requirement. Until 45 days after the period of restriction under Paragraph (b) expires, you shall give notice to your Employer of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide your Employer with such other pertinent information concerning such business activity as your Employer or the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. (l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify your Employer or the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to 30

 
such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. H. IRELAND ____________________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. All terms and defined terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (i) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance written notice; and (ii) If you are an Executive Vice President or higher, you will give 90 days’ advance written notice. (iii) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (b) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company 31

 
may place you on a partial or complete leave of absence otherwise known as “garden leave” and relieve you of some or all of your duties and responsibilities and to cease attending your place of work and/or to cease contact with the Employer’s employees and customers. During any period of garden leave, you will remain subject to the provisions of this agreement and to your obligation of fidelity to your Employer, the Company and its Subsidiaries. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or, subject to applicable law, to accrue any paid vacation time. (c) You agree that should you fail to provide advance written notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for a period equal to the period for which notice of resignation was required but not provided, in addition to any other remedies available under law. (d) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph 1, and give immediate effect to your resignation and make a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligation under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher with the Employer and/or the Company or its Subsidiaries. (b) During your Employment and for the six months (such period to be reduced by the duration of the Notice Period as defined in Paragraph 1 above) following its termination for any reason, you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries within the island of Ireland or the United Kingdom, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company 32

 
or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries and has the meaning assigned to such by section 7 of the Companies Act 2014. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will make yourself available and reasonably cooperate with the Company or the relevant Subsidiary or their advisers with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation provided that such expenses are approved in advance by the Company or Employer. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s/legal fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional 33

 
obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations. Nothing in this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other relevant disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same I. LUXEMBOURG ____________________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. 34

 
All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title Executive Vice President or higher you are required to give your Employer advance notice of your resignation as per the legal provisions. (b) During the Notice Period, you will cooperate with your employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period. (c) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its Subsidiaries shall be entitled to a compensatory payment in addition to any other remedies available under law. (d) At any time during the Notice Period and upon your request formulated in writing, the Company or your Employer may release you from your obligations under this Section 1, and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher. (b) During your Employment you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or they do business, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) For the 12 months after you leave the company, whatever the reason, you will not, directly or indirectly, as a self-employed person whether as owner, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or they do business, or undertake any planning for any business 35

 
competitive with the business of your Employer, the Company or any of its Subsidiaries, this area being in any case limited to the Grand-Duchy of Luxembourg. Specifically, but without limiting the foregoing, you agree not to engage in any manner as a self-employed person in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your 36

 
Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations (a) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information 37

 
learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, and/or privileges applicable to information covered by the bank secrecy (Article 41 of the Law on the financial sector dated April 5, 1993, as amended), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. J. NETHERLANDS ____________________________________________________________________________ 1. Waiver of Termination Rights. As a condition to the grant of this Award, you hereby waive any and all rights to compensation or damages as a result of the termination of Employment with the Company and the Subsidiary that employs you in the Netherlands for any reason whatsoever, insofar as those rights result or may result from (a) the loss or diminution in value of such rights or entitlements under the Plan, or (b) your ceasing to have rights under, or ceasing to be entitled to any awards under the Plan as a result of such termination. K. POLAND ____________________________________________________________________________ Kopię tej Umowy w języku polskim może Pan/Pani otrzymać wchodząc na Stronę. L. UNITED KINGDOM ____________________________________________________________________________ 1. Income Tax and Social Insurance Contribution Withholding. Without limitation to Section 7 of the Agreement, you hereby agree that you are liable for all Tax-Related Items and hereby consent to pay all such Tax-Related Items, as and when requested by the Company and or your Employer (if different) or by HM Revenue & Customs (“HMRC”) (or any other tax authority or any other relevant authority). You also hereby agree to indemnify and keep indemnified the Company and your Employer (if different) against any Tax-Related Items that they are required to pay or withhold on your behalf or have paid or will pay to HMRC (or any other tax authority or any other relevant authority). Notwithstanding the foregoing, if you are a director or executive officer of the Company (within the meaning of Section 13(k) of the Exchange Act), you understand that you may not be able to indemnify the Company for the amount of any income tax not collected from or paid by you within ninety (90) days of the end of the U.K. tax year in which the event giving rise to the Tax-Related Items occurs as it may be considered to be a loan and therefore, it may constitute a benefit to you on which additional income tax and National Insurance contributions (“NICs”) may be payable. You understand that you will be responsible for reporting and paying any income tax due on this additional benefit 38

 
directly to HMRC under the self-assessment regime and for paying to the Company and/or your Employer (as appropriate) the amount of any NICs due on this additional benefit, which may also be recovered from you by any of the means referred to in Section 7 of the Agreement. 2. Exclusion of Claim. You acknowledge and agree that you will have no entitlement to compensation or damages insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Award, whether or not as a result of such termination, (whether such termination is in breach of contract or otherwise), or from the loss or diminution in value of the Award. Upon the grant of your Award, you shall be deemed irrevocably to have waived any such entitlement. 3. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. 39

 
(iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligations under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. (ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co-venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 12 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. (iv) Nothing in this Paragraph (b) shall prevent your ownership for investment purposes only of shares or other securities of two percent (2%) or less of the total issued capital of any company whether or not its securities are publicly traded. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. (ii) “Products or Services” means any products or services which are of the same kind as, of a materially similar kind to, or competitive with, any products or services 40

 
supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. (iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall 41

 
have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs (a) and (b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. (k) Notification Requirement. Until 45 days after the period of restriction under this Paragraph 3 (b) expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. (l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made 42

 
generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * 43

 
STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN 1. Purpose The purpose of this 2017 Stock Incentive Plan (the “Plan”) of State Street Corporation, a Massachusetts corporation (the “Company”), is to advance the interests of the Company’s shareholders by enhancing the Company’s ability to attract, retain and motivate persons who are expected to make important contributions to the Company and by providing such persons with equity ownership opportunities and performance-based incentives that are intended to better align the interests of such persons with those of the Company’s shareholders. Except where the context otherwise requires, the term “Company” shall include any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) or (f) of the Internal Revenue Code of 1986, as amended, and any regulations thereunder (the “Code”) and any other business venture (including, without limitation, joint venture or limited liability company) in which the Company has a controlling interest, as determined by the Board of Directors of the Company (the “Board”). 2. Eligibility All of the Company’s employees, officers and directors, as well as consultants and advisors to the Company (as the terms consultants and advisors are defined and interpreted for purposes of Form S-8 under the Securities Act of 1933, as amended (the “Securities Act”), or any successor form) are eligible to be granted Awards (as defined below) under the Plan. Each person who is granted an Award under the Plan is deemed a “Participant.” The Plan provides for the following types of awards, each of which is referred to as an “Award”: Options (as defined in Section 5), SARs (as defined in Section 6), Restricted Stock (as defined in Section 7), RSUs (as defined in Section 7) and Other Stock-Based Awards (as defined in Section 8). Except as otherwise provided by the Plan, each Award may be made alone or in addition or in relation to any other Award. The terms of each Award need not be identical, and the Board need not treat Participants uniformly. 3. Administration and Delegation (a) Administration by Board of Directors. The Plan will be administered by the Board. The Board shall have authority to grant Awards and to adopt, amend and repeal such administrative rules, guidelines and practices relating to the Plan as it shall deem advisable. The Board may construe and interpret the terms of the Plan and any Award agreements entered into under the Plan. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award. All actions and decisions by the Board with respect to the Plan and any Awards shall be made in the Board’s discretion and shall be final and binding on all persons having or claiming any interest in the Plan or in any Award.

 
(b) Appointment of Committees. To the extent permitted by applicable law, the Board may delegate any or all of its powers under the Plan to one or more committees or subcommittees of the Board (a “Committee”). All references in the Plan to the “Board” shall mean the Board or a Committee of the Board to the extent that the Board’s powers or authority under the Plan have been delegated to such Committee. During such time as the common stock, $1.00 par value per share, of the Company (the “Common Stock”) is registered under the Securities Exchange Act of 1934 (the “Exchange Act”), the Board shall appoint one such Committee of not less than two members, each member of which shall be an independent director under applicable stock exchange rules, an “outside director” within the meaning of Section 162(m) of the Code or any successor provision thereto, and the regulations thereunder (“Section 162(m)”) and a “non-employee director” as defined in Rule 16b-3 under the Exchange Act. (c) Delegation of Granting and Other Authority. The Board or a Committee may delegate to (1) one or more of its members such of its duties, powers and responsibilities as it may determine; (2) to one or more officers of the Company the power and authority to grant or to allocate, consistent with the requirements of Chapter 156D of the Massachusetts General Laws and subject to such limitations under the Plan or as the Board or the Committee may impose, Awards among such persons (other than to any “executive officer” of the Company (as defined by Rule 3b-7 under the Exchange Act) or to any “officer” of the Company (as defined by Rule 16a-1(f) under the Exchange Act)) eligible to receive Awards under the Plan as such delegated member or members of the Board or the Committee or officer or officers of the Company determine consistent with such delegation; and (3) to such employees or other persons as it determines such ministerial tasks as it deems appropriate. In the event of any delegation described in the preceding sentence, references in the Plan to the “Board” shall mean the delegate to the extent that the Board’s powers or authority under the Plan have been delegated to such person. (d) Awards to Non-Employee Directors. Awards to non-employee directors will be granted and administered by a Committee, all of the members of which are independent directors as defined by Section 303A.02 of the New York Stock Exchange Listed Company Manual. 4. Stock Available for Awards (a) Number of Shares; Share Counting. (1) Authorized Number of Shares. Awards may be made under the Plan (any or all of which Awards may be in the form of Incentive Stock Options (as defined in Section 5(b)) for such number of shares of Common Stock as is equal to the sum of: (A) 8,300,000 shares of Common Stock; plus (B) such additional number of shares of Common Stock (up to 28,500,000 shares) as is equal to the sum of (x) the number of shares of Common Stock reserved for issuance under the Company’s 2006 Equity Incentive Plan, as amended (the “Existing Plan”) that remain available for grant under the Existing Plan immediately prior to the Company’s 2017 Annual Meeting of Shareholders -2-

 
and (y) the number of shares of Common Stock subject to awards granted under the Existing Plan which awards expire, terminate or are otherwise surrendered, canceled, forfeited or repurchased by the Company at their original issuance price pursuant to a contractual repurchase right (subject, however, in the case of Incentive Stock Options to any limitations of the Code). Shares of Common Stock issued under the Plan may consist in whole or in part of authorized but unissued shares or treasury shares. (2) Share Counting. For purposes of counting the number of shares available for the grant of Awards under the Plan under this Section 4(a) and under the sublimits contained in Section 4(b)(2): (A) all shares of Common Stock covered by SARs shall be counted against the number of shares available for the grant of Awards under the Plan and against the sublimits contained in Section 4(b)(2); provided, however, that (i) SARs that may be settled only in cash shall not be so counted and (ii) if the Company grants an SAR in tandem with an Option for the same number of shares of Common Stock and provides that only one such Award may be exercised (a “Tandem SAR”), only the shares covered by the Option, and not the shares covered by the Tandem SAR, shall be so counted, and the expiration of one in connection with the other’s exercise will not restore shares to the Plan; (B) if any Award (i) expires or is terminated, surrendered or canceled without having been fully exercised or is forfeited in whole or in part (including as the result of shares of Common Stock subject to such Award being repurchased by the Company at the original issuance price pursuant to a contractual repurchase right), or (ii) results in any Common Stock not being issued (including as result of an SAR that was settleable either in cash or in stock actually being settled in cash), the unused Common Stock covered by such Award shall again be available for the grant of Awards. Further, shares of Common Stock delivered (either by actual delivery, attestation or net exercise) to the Company by a Participant to exercise an Award or to satisfy any tax withholding obligations in accordance with Section 11(d) (including shares retained from the Award creating the tax obligation) shall be added back to the number of shares of Common Stock available for the future grant of Awards, provided that no more than the number of shares used to satisfy the statutory minimum tax withholding obligation shall be added back to the Plan pursuant to this section 4(a)(2)(B). However, (1) in the case of Incentive Stock Options, the foregoing shall be subject to any limitations under the Code, (2) in the case of the exercise of an SAR, the number of shares counted against the shares available under the Plan and against the sublimits contained in Section 4(b)(2) shall be the full number of shares subject to the SAR multiplied by the percentage of the SAR actually exercised, regardless of the number of shares actually used to settle such SAR upon exercise and (3) the shares covered by a Tandem SAR shall not again become available for grant upon the expiration or termination of such Tandem SAR; and (C) shares of Common Stock repurchased by the Company on the open market using the proceeds from the exercise of an Award shall not increase the number of shares available for future grant of Awards. -3-

 
(b) Sublimits. Subject to adjustment under Section 10, the following sublimits on the number of shares subject to Awards shall apply: (1) Section 162(m) Per-Participant Limits. The maximum number of shares of Common Stock with respect to which Options may be granted to any person in any calendar year and the maximum number of shares of Common Stock subject to SARs granted to any person in any calendar year shall each be 2,000,000, and the maximum number of shares of Common Stock subject to other Awards granted to any person in any calendar year shall be 2,000,000. The per-Participant limits described in this Section 4(b)(1) shall be construed and applied consistently with Section 162(m). (2) Limit Applicable to Non-Employee Directors. In any calendar year, the sum of cash compensation paid to any non-employee director for service as a director (“Director Cash Compensation”) and the value of Awards under the Plan made to such non-employee director (calculated based on the grant date fair value of such Awards for financial reporting purposes) (“Director Equity Compensation”) shall not exceed $1,500,000. The Board may make exceptions to this limit for individual non-employee directors in extraordinary circumstances, as the Committee may determine in its discretion, provided that the non- employee director receiving such additional compensation may not participate in the decision to award such compensation. For purposes of this Section 4(b)(2), Director Cash Compensation and Director Equity Compensation in any calendar year shall include any amounts or grants that would have been paid or made, as applicable, to a particular non-employee director absent such director’s election to defer such compensation pursuant to any arrangement or plan of the Company permitting deferral of such compensation. (c) Substitute Awards. In connection with a merger or consolidation of an entity with the Company or the acquisition by the Company of property or stock of an entity, the Board may grant Awards in substitution for any options or other stock or stock-based awards granted by such entity or an affiliate thereof. Substitute Awards may be granted on such terms as the Board deems appropriate in the circumstances, notwithstanding any limitations on Awards contained in the Plan. Substitute Awards shall not count against the overall share limit set forth in Section 4(a)(1) or any sublimits contained in the Plan, except as may be required by reason of Section 422 and related provisions of the Code. 5. Stock Options (a) General. The Board may grant options to purchase Common Stock (each, an “Option”) and determine the number of shares of Common Stock to be covered by each Option, the exercise price of each Option and the conditions and limitations applicable to the exercise of each Option, including conditions relating to applicable federal or state securities laws, as the Board considers necessary or advisable. (b) Incentive Stock Options. An Option that the Board intends to be an “incentive stock option” as defined in Section 422 of the Code (an “Incentive Stock Option”) shall only be granted to employees of State Street Corporation, any of State Street Corporation’s present or future parent or subsidiary corporations as defined in Sections 424(e) or (f) of the Code, and any other entities the employees of which are eligible to receive Incentive Stock Options under the -4-

 
Code, and shall be subject to and shall be construed consistently with the requirements of Section 422 of the Code. An Option that is not intended to be an Incentive Stock Option shall be designated a “Nonstatutory Stock Option.” The Company shall have no liability to a Participant, or any other person, if an Option (or any part thereof) that is intended to be an Incentive Stock Option is not an Incentive Stock Option or if the Company converts an Incentive Stock Option to a Nonstatutory Stock Option. (c) Exercise Price. The Board shall establish the exercise price of each Option or the formula by which such exercise price will be determined. The exercise price shall be specified in the applicable Option agreement. The exercise price shall not be less than 100% of the Grant Date Fair Market Value (as defined below) of the Common Stock on the date the Option is granted; provided that if the Board approves the grant of an Option with an exercise price to be determined on a future date, the exercise price shall be not less than 100% of the Grant Date Fair Market Value on such future date. “Grant Date Fair Market Value” of a share of Common Stock for purposes of the Plan will be determined as follows: (1) if the Common Stock trades on a national securities exchange, the closing sale price (for the primary trading session) on the date of grant; or (2) if the Common Stock does not trade on any such exchange, the average of the closing bid and asked prices as reported by an authorized OTCBB market data vendor as listed on the OTCBB website (otcbb.com) on the date of grant; or (3) if the Common Stock is not publicly traded, the Board will determine the Grant Date Fair Market Value for purposes of the Plan using any measure of value it determines to be appropriate (including, as it considers appropriate, relying on appraisals) in a manner consistent with the valuation principles under Code Section 409A, except as the Board may expressly determine otherwise. For any date that is not a trading day, the Grant Date Fair Market Value of a share of Common Stock for such date will be determined by using the closing sale price or average of the bid and asked prices, as appropriate, for the immediately preceding trading day and with the timing in the formulas above adjusted accordingly. The Board can substitute a particular time of day or other measure of “closing sale price” or “bid and asked prices” if appropriate because of exchange or market procedures or can, in its sole discretion, use weighted averages either on a daily basis or such longer period as complies with Code Section 409A. The Board has sole discretion to determine the Grant Date Fair Market Value for purposes of the Plan, and all Awards are conditioned on the participants’ agreement that the Board’s determination is conclusive and binding even though others might make a different determination. (d) Duration of Options. Subject to the provisions of the Plan, each Option shall be exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable Option agreement; provided, however, that no Option will be granted with a term in excess of 10 years. -5-

 
(e) Exercise of Options. Options may be exercised by delivery to the Company of a notice of exercise in a form (which may be electronic) approved by the Company, together with payment in full (in the manner specified in Section 5(f)) of the exercise price for the number of shares for which the Option is exercised. Shares of Common Stock subject to the Option will be delivered by the Company as soon as practicable following exercise. (f) Payment Upon Exercise. Common Stock purchased upon the exercise of an Option granted under the Plan shall be paid for as follows: (1) in cash or by check, payable to the order of the Company; (2) except as may otherwise be provided in the applicable Option agreement or approved by the Board, by (i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding or (ii) delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding; (3) to the extent provided for in the applicable Option agreement or approved by the Board, by delivery (either by actual delivery or attestation) of shares of Common Stock owned by the Participant valued at their fair market value (valued in the manner determined by (or in a manner approved by) the Board), provided (i) such method of payment is then permitted under applicable law, (ii) such Common Stock, if acquired directly from the Company, was owned by the Participant for such minimum period of time, if any, as may be established by the Board and (iii) such Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements; (4) to the extent provided for in the applicable Nonstatutory Stock Option agreement or approved by the Board, by delivery of a notice of “net exercise” to the Company, as a result of which the Participant would receive (i) the number of shares underlying the portion of the Option being exercised, less (ii) such number of shares as is equal to (A) the aggregate exercise price for the portion of the Option being exercised divided by (B) the fair market value of the Common Stock (valued in the manner determined by (or in a manner approved by) the Board) on the date of exercise; (5) to the extent permitted by applicable law and provided for in the applicable Option agreement or approved by the Board, by payment of such other lawful consideration as the Board may determine; or (6) by any combination of the above permitted forms of payment. (g) Limitation on Repricing. Unless such action is approved by the Company’s shareholders, the Company may not (except as provided for under Section 10): (1) amend any outstanding Option granted under the Plan to provide an exercise price per share that is lower than the then-current exercise price per share of such outstanding Option, (2) cancel any outstanding option (whether or not granted under the Plan) and grant in substitution therefor new -6-

 
Awards under the Plan (other than Awards granted pursuant to Section 4(c)) covering the same or a different number of shares of Common Stock and having an exercise price per share lower than the then-current exercise price per share of the canceled option, (3) cancel in exchange for a cash payment any outstanding Option with an exercise price per share above the then-current fair market value of the Common Stock (valued in the manner determined by (or in a manner approved by) the Board), or (4) take any other action under the Plan that constitutes a “repricing” within the meaning of the rules of the New York Stock Exchange. (h) No Reload Options. No Option granted under the Plan shall contain any provision entitling the Participant to the automatic grant of additional Options in connection with any exercise of the original Option. 6. Stock Appreciation Rights (a) General. The Board may grant Awards consisting of stock appreciation rights (“SARs”) entitling the holder, upon exercise, to receive an amount of Common Stock or cash or a combination thereof (such form to be determined by the Board) determined by reference to appreciation, from and after the date of grant, in the fair market value of a share of Common Stock (valued in the manner determined by (or in a manner approved by) the Board) over the measurement price established pursuant to Section 6(b). The date as of which such appreciation is determined shall be the exercise date. (b) Measurement Price. The Board shall establish the measurement price of each SAR and specify it in the applicable SAR agreement. The measurement price shall not be less than 100% of the Grant Date Fair Market Value of the Common Stock on the date the SAR is granted; provided that if the Board approves the grant of an SAR effective as of a future date, the measurement price shall be not less than 100% of the Grant Date Fair Market Value on such future date. (c) Duration of SARs. Subject to the provisions of the Plan, each SAR shall be exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable SAR agreement; provided, however, that no SAR will be granted with a term in excess of 10 years. (d) Exercise of SARs. SARs may be exercised by delivery to the Company of a notice of exercise in a form (which may be electronic) approved by the Company, together with any other documents required by the Board. (e) Limitation on Repricing. Unless such action is approved by the Company’s shareholders, the Company may not (except as provided for under Section 10): (1) amend any outstanding SAR granted under the Plan to provide a measurement price per share that is lower than the then-current measurement price per share of such outstanding SAR, (2) cancel any outstanding SAR (whether or not granted under the Plan) and grant in substitution therefor new Awards under the Plan (other than Awards granted pursuant to Section 4(c)) covering the same or a different number of shares of Common Stock and having a measurement price per share lower than the then-current measurement price per share of the cancelled SAR, (3) cancel in exchange for a cash payment any outstanding SAR with a measurement price per share above the -7-

 
then-current fair market value of the Common Stock (valued in the manner determined by (or in a manner approved by) the Board), or (4) take any other action under the Plan that constitutes a “repricing” within the meaning of the rules of the NYSE. (f) No Reload SARs. No SAR granted under the Plan shall contain any provision entitling the Participant to the automatic grant of additional SARs in connection with any exercise of the original SAR. 7. Restricted Stock; RSUs (a) General. The Board may grant Awards entitling recipients to acquire shares of Common Stock (“Restricted Stock”), subject to the right of the Company to repurchase all or part of such shares at their issue price or other stated or formula price (or to require forfeiture of such shares if issued at no cost) from the recipient in the event that conditions specified by the Board in the applicable Award are not satisfied prior to the end of the applicable restriction period or periods established by the Board for such Award. The Board may also grant Awards entitling the recipient to receive shares of Common Stock or cash to be delivered at the time such Award vests or is settled by the Company (“RSUs”). (b) Terms and Conditions for Restricted Stock and RSUs. Subject to the provisions of the Plan, the Board shall determine the terms and conditions of Restricted Stock and RSUs, including the conditions for vesting and repurchase (or forfeiture) and the issue price, if any. (c) Stock Certificates; Dividends. The Company may require that any stock certificates issued in respect of shares of Restricted Stock, as well as dividends or distributions paid on such Restricted Stock, shall be deposited in escrow by the Participant, together with a stock power endorsed in blank, with the Company (or its designee). At the expiration of the applicable vesting, forfeiture and / or restriction periods, the Company (or such designee) shall deliver the certificates no longer subject to such restrictions as well as any dividends or other distributions to the Participant or if the Participant has died, to his or her Designated Beneficiary. “Designated Beneficiary” means (i) the beneficiary designated, in a manner determined by the Board, by a Participant to receive amounts due or exercise rights of the Participant in the event of the Participant’s death or (ii) in the absence of an effective designation by a Participant, the Participant’s estate. (d) Additional Provisions Relating to RSUs. (1) Settlement. Upon the vesting of and/or lapsing of any other restrictions (i.e., settlement) with respect to each RSU, the Participant shall be entitled to receive from the Company the number of shares of Common Stock specified in the Award agreement or (if so provided in the applicable Award agreement or otherwise determined by the Board) an amount of cash equal to the fair market value (valued in the manner determined by (or in a manner approved by) the Board) of such number of shares or a combination thereof. The Board may provide that settlement of RSUs shall be deferred, on a mandatory basis or at the election of the Participant, in a manner that complies with Section 409A of the Code or any successor provision thereto, and the regulations thereunder (“Section 409A”). -8-

 
(2) Voting Rights. A Participant shall have no voting rights with respect to any RSUs. 8. Other Stock-Based Awards (a) General. The Board may grant other Awards of shares of Common Stock, and other Awards that are valued in whole or in part by reference to, or are otherwise based on, shares of Common Stock or other property (“Other Stock-Based Awards”). Such Other Stock- Based Awards shall also be available as a form of payment in the settlement of other Awards granted under the Plan or as payment in lieu of compensation to which a Participant is otherwise entitled. Other Stock-Based Awards may be paid in shares of Common Stock or cash, as the Board shall determine. (b) Terms and Conditions. Subject to the provisions of the Plan, the Board shall determine the terms and conditions of each Other Stock-Based Award, including any purchase price applicable thereto. 9. Performance Awards. (a) Grants. Restricted Stock, RSUs and Other Stock-Based Awards under the Plan may be made subject to the achievement of performance goals pursuant to this Section 9 (“Performance Awards”). (b) Committee. Grants of Performance Awards to any Covered Employee (as defined below) intended to qualify as “performance-based compensation” under Section 162(m) (“Performance-Based Compensation”) shall be made only by a Committee (or a subcommittee of a Committee) comprised solely of two or more directors eligible to serve on a committee making Awards qualifying as “performance-based compensation” under Section 162(m). In the case of such Awards granted to Covered Employees, references to the Board or to a Committee shall be treated as referring to such Committee (or subcommittee). “Covered Employee” shall mean any person who is, or whom the Committee, in its discretion, determines may be, a “covered employee” under Section 162(m)(3) of the Code. (c) Performance Measures. For any Award that is intended to qualify as Performance-Based Compensation, the Committee shall specify that the degree of granting, vesting and/or payout shall be subject to the achievement of one or more objective performance measures established by the Committee, which shall be based on the relative or absolute attainment of specified levels of one or any combination of the following, which may be determined pursuant to generally accepted accounting principles (“GAAP”) or on a non-GAAP basis, as determined by the Committee (the “Performance Measures”): i) earnings or earnings per share xii) risk control ii) return on equity xiii) expense iii) return on assets xiv) operating leverage iv) return on capital xv) operating fee leverage v) cost of capital xvi) capital ratios vi) total stockholder return xvii) liquidity ratios -9-

 
vii) revenue xviii) income viii) market share xix) comprehensive capital analysis and ix) quality/service review (CCAR) x) organizational development xx) other regulatory-related metric xi) strategic initiatives (including acquisitions or dispositions) Such goals may reflect absolute entity or business unit performance or a relative comparison to the performance of a peer group of entities or other external measure of the selected performance criteria and may be absolute in their terms or measured against or in relationship to other companies comparably, similarly or otherwise situated. The Performance Measures: (x) may vary by Participant and may be different for different Awards; (y) may be particular to a Participant or the department, branch, line of business, subsidiary or other unit in which the Participant works and may cover such period as may be specified by the Committee; and (z) shall be set by the Committee within the time period prescribed by, and shall otherwise comply with the requirements of, Section 162(m). Awards that are not intended to qualify as Performance-Based Compensation may be based on these or such other performance measures as the Board may determine. (d) Adjustments to Performance Measures. The Committee may provide, no later than the deadline for establishing the Performance Measures for a year, that one or more of the Performance Measures applicable to an Award or Awards for such year will be adjusted in an objectively determinable manner to reflect events (for example, but without limitation, acquisitions, dispositions, joint ventures or restructurings, expenses associated with acquisitions, dispositions, joint ventures or restructurings, amortization of purchased intangibles associated with acquisitions, impact (dilution and expenses) of securities issuances (debt or equity) to finance, or in contemplation of, acquisitions or ventures, merger and integration expenses, changes in accounting principles or interpretations, changes in tax law or financial regulatory law, impairment charges, fluctuations in foreign currency exchange rates, charges for restructuring or rationalization programs (e.g., cost of workforce reductions, facilities or lease abandonments, asset impairments), one-time insurance claims payments, extraordinary and/or non-recurring items, litigation, regulatory matter or tax rate changes) occurring during the year that affect the applicable Performance Measure. (e) Adjustments to Performance-Based Compensation. Notwithstanding any provision of the Plan, with respect to any Performance Award that is intended to qualify as Performance-Based Compensation, the Committee may adjust downwards, but not upwards, the number of shares payable pursuant to such Award, and the Committee may not waive the achievement of the applicable performance measures except in the case of the death or disability of the Participant or a change in control of the Company. (f) Other. The Committee shall have the power to impose such other restrictions on Performance Awards as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for Performance-Based Compensation. With respect to any Performance Award that is intended to qualify as Performance-Based Compensation, the Plan and such Award will be construed to the maximum extent permitted by law in a manner consistent with qualifying such Award for such exception. With respect to such Performance Awards, the Committee will -10-

 
preestablish, in writing, one or more specific performance measures no later than 90 days after the commencement of the period of service to which the performance relates (or at such earlier time as is required to qualify the Performance Award as Performance-Based Compensation). Prior to grant, vesting or payment of such Performance Award, as the case may be, the Committee will certify whether the applicable performance measures have been attained and such determination will be final and conclusive. No Performance Award that is intended to qualify as Performance-Based Compensation may be granted after the first meeting of the shareholders of the Company held in 2022 until the performance measures set forth in Section 9(c) (as originally approved or as subsequently amended) have been resubmitted to and reapproved by the shareholders of the Company in accordance with the requirements of Section 162(m), unless such grant is made contingent upon such approval. 10. Adjustments for Changes in Common Stock and Certain Other Events (a) Changes in Capitalization. In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any dividend or distribution to holders of Common Stock other than an ordinary cash dividend, (i) the number and class of securities available under the Plan, (ii) the share counting rules and sublimits set forth in Sections 4(a) and 4(b), (iii) the number and class of securities and exercise price per share of each outstanding Option, (iv) the share and per-share provisions and the measurement price of each outstanding SAR, (v) the number of shares subject to and the repurchase price per share subject to each outstanding award of Restricted Stock and (vi) the share and per-share-related provisions and the purchase price, if any, of each outstanding RSU and each Other Stock-Based Award, shall be equitably adjusted by the Company (or substituted Awards may be made, if applicable) in the manner determined by the Board. Without limiting the generality of the foregoing, in the event the Company effects a split of the Common Stock by means of a stock dividend and the exercise price of and the number of shares subject to an outstanding Option are adjusted as of the date of the distribution of the dividend (rather than as of the record date for such dividend), then an optionee who exercises an Option between the record date and the distribution date for such stock dividend shall be entitled to receive, on the distribution date, the stock dividend with respect to the shares of Common Stock acquired upon such Option exercise, notwithstanding the fact that such shares were not outstanding as of the close of business on the record date for such stock dividend. (b) Covered Transactions and Change in Control. (1) Definitions. (i) A “Covered Transaction” shall mean: (A) a consolidation, merger, or similar transaction or series of related transactions, including a sale or other disposition of stock, in which the Company is not the surviving corporation or which results in the acquisition of all or substantially all of the Company’s then outstanding Common Stock by a -11-

 
single person or entity or by a group of persons and/or entities acting in concert; (B) a sale or transfer of all or substantially all the Company’s assets; or (C) a dissolution or liquidation of the Company. Where a Covered Transaction involves a tender offer that is reasonably expected to be followed by a merger described in clause (A) (as determined by the Board), the Covered Transaction shall be deemed to have occurred upon consummation of the tender offer. (ii) A “Change in Control ” shall mean: (A) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either (I) the then-outstanding shares of Common Stock (the “Outstanding Company Common Stock”) or (II) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); excluding, however, the following acquisitions of Outstanding Company Common Stock and Outstanding Company Voting Securities: (W) any acquisition directly from the Company, (X) any acquisition by the Company, (Y) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (Z) any acquisition by any Person pursuant to a transaction which complies with clauses (I), (II) and (III) of subsection (C) of this definition; (B) individuals who, as of the effective date of the Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual who becomes a member of the Board subsequent to such effective date, whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least -12-

 
a majority of directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board; but, provided further, that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or (C) consummation by the Company of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (“Business Combination”); excluding, however, such a Business Combination pursuant to which (I) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the then- outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (II) no Person (other than any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or such corporation resulting from such Business Combination) will beneficially own, directly or indirectly, 25% or more of, respectively, the outstanding shares of common stock of the -13-

 
corporation resulting from such Business Combination or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors except to the extent that such ownership existed with respect to the Company prior to the Business Combination and (III) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or (D) the approval by the shareholders of the Company of a complete liquidation or dissolution of the Company; provided, that, to the extent necessary to ensure compliance with the requirements of Section 409A, where applicable, an event described above shall be treated as a Change in Control only if it also constitutes or results in a change in ownership or control of the Company, or a change in ownership of assets of the Company, described in Section 409A. (iii) “Cause” shall mean: (A) If the Participant is party to an employment or similar agreement with the Company that contains a definition of “Cause,” that definition shall apply for purposes of the Plan. (B) Otherwise, “Cause” shall mean any (I) willful failure by the Participant, which failure is not cured within 30 days of written notice to the Participant from the Company, to perform his or her material responsibilities to the Company or (II) willful misconduct by the Participant which is materially injurious to the Company. For purposes of this definition of “Cause,” reference to the “Company” shall include the acquiror or survivor (or an affiliate of the acquiror or survivor) in the applicable Change in Control. (iv) “Good Reason” shall mean: -14-

 
(A) If the Participant is party to an employment or similar agreement with the Company that contains a definition of “Good Reason,” that definition shall apply for purposes of the Plan. (B) Otherwise, “Good Reason” shall mean any significant diminution in the Participant’s duties, authority, or responsibilities from and after such Change in Control, as the case may be, or any material reduction in the base compensation payable to the Participant from and after such Change in Control, as the case may be, or the relocation of the place of business at which the Participant is principally located to a location that is greater than 50 miles from its location immediately prior to such Change in Control. Notwithstanding the occurrence of any such event or circumstance, such occurrence shall not be deemed to constitute Good Reason unless (I) the Participant gives the Company the notice of termination no more than 90 days after the initial existence of such event or circumstance, (II) such event or circumstance has not been fully corrected and the Participant has not been reasonably compensated for any losses or damages resulting therefrom within 30 days of the Company’s receipt of such notice and (III) the Participant’s termination of Employment occurs within six months following the Company’s receipt of such notice. For purposes of this definition of “Good Reason,” reference to the “Company” shall include the acquiror or survivor (or an affiliate of the acquiror or survivor) in the applicable Change in Control. (v) “Employment” shall mean a Participant’s employment or other service relationship with the Company and its subsidiaries. Employment will be deemed to continue, unless the Board expressly provides otherwise, so long as the Participant is employed by, or otherwise is providing services in a capacity described in Section 1 to the Company or its subsidiaries. If a Participant’s employment or other service relationship is with a subsidiary of the Company and that entity ceases to be a subsidiary, the Participant’s Employment will be deemed to have terminated when the entity ceases to be subsidiary of the Company unless the Participant transfers Employment to the Company or its remaining subsidiaries. -15-

 
(2) Effect on Awards. (i) Covered Transactions. Except as otherwise provided in an Award, the following provisions shall apply in the event of a Covered Transaction: (A) Assumption or Substitution. If the Covered Transaction is one in which there is an acquiring or surviving entity, the Board may provide for the assumption of some or all outstanding Awards or for the grant of new awards in substitution therefor by the acquiror or survivor or an affiliate of the acquiror or survivor. (B) Cash-Out of Awards. If the Covered Transaction is one in which holders of C o m m o n Stock will receive upon consummation a payment (whether cash, non-cash or a combination of the foregoing), the Board may provide for payment (a “cash-out”), with respect to some or all Awards, equal in the case of each affected Award to the excess, if any, of (A) the fair market value of one share of Common Stock (as determined by the Board in its reasonable discretion) times the number of shares of Common Stock subject to the Award, over (B) the aggregate exercise or purchase price, if any, under the Award (in the case of an SAR, the aggregate base price above which appreciation is measured), in each case on such payment terms (which need not be the same as the terms of payment to holders of Common Stock) and other terms, and subject to such conditions, as the Board determines. (C) Acceleration of Certain Awards. If the Covered Transaction (whether or not there is an acquiring or surviving entity) is one in which there is no assumption, substitution or cash-out, each Award requiring exercise will become fully exercisable, each Award of Restricted Stock will become fully vested and the delivery of shares of Common Stock deliverable under each outstanding award of RSUs, Performance Awards (to the extent consisting of RSUs) and Other Stock-Based Awards will be accelerated and such shares will be delivered, prior to the Covered Transaction, in each case on a basis that gives the holder of the Award a reasonable opportunity, as determined by -16-

 
the Board, following exercise of the Award or the delivery of the shares, as the case may be, to participate as a shareholder in the Covered Transaction. (D) Termination of Awards Upon Consummation of Covered Transaction. Each Award (unless assumed or substituted pursuant to Section 10(b)(2)(i)(A) above), other than outstanding shares of Restricted Stock (which shall be treated in the same manner as other shares of Common Stock, subject to Section 10(b)(2)(i)(E) below), will terminate upon consummation of the Covered Transaction. (E) Additional Limitations. Any share of Common Stock delivered pursuant to Section 10(b)(2)(i)(A) or Section 10(b)(2)(i)(C) above with respect to an Award may, in the discretion of the Board, contain such restrictions, if any, as the Board deems appropriate to reflect any performance or other vesting conditions to which the Award was subject. In the case of Restricted Stock, the Board may require that any amounts delivered, exchanged or otherwise paid in respect of such Common Stock in connection with the Covered Transaction be placed in escrow or otherwise made subject to such restrictions as the Board deems appropriate to carry out the intent of the Plan. (ii) Change in Control. Notwithstanding any other provision of the Plan to the contrary, in the event of a Change in Control: (A) Acceleration of Options and SARs; Effect on Other Awards. If, on or prior to the first anniversary of the consummation of the Change in Control, the Participant’s Employment with the Company is terminated for Good Reason by the Participant or is terminated without Cause by the Company, all Options and SARs outstanding as of the date such Change in Control is consummated and which are not then exercisable shall become exercisable to the full extent of the original grant, all shares of Restricted Stock which are not otherwise vested shall vest, and Performance Awards granted hereunder shall vest to the extent set forth in the applicable Award agreement. -17-

 
(B) Restriction on Application of Plan Provisions Applicable in the Event of Termination of Employment. After a Change of Control, Options and SARs granted under Section 10(b)(2)(i)(A) as substitution for existing Awards shall remain exercisable following a termination of Employment (other than termination by reason of death, disability (as determined by the Company) or retirement (as defined in the Award)) for the lesser of (I) a period of seven (7) months, or (II) the period ending on the latest date on which such Option or SAR could otherwise have been exercised. (C) Restriction on Amendment. In connection with or following a Change in Control, the Board may not impose additional conditions upon exercise or otherwise amend or restrict any Award, or amend the terms of the Plan in any manner adverse to the holder thereof, without the written consent of such holder. 11. General Provisions Applicable to Awards (a) Transferability of Awards. Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by a Participant, either voluntarily or by operation of law, except by will or the laws of descent and distribution or, other than in the case of an Incentive Stock Option, pursuant to a qualified domestic relations order, and, during the life of the Participant, shall be exercisable only by the Participant; provided, however, that, except with respect to Awards subject to Section 409A, the Board may permit or provide in an Award for the gratuitous transfer of the Award by the Participant to or for the benefit of any immediate family member, family trust or other entity established for the benefit of the Participant and/or an immediate family member thereof if the Company would be eligible to use a Form S-8 under the Securities Act for the registration of the sale of the Common Stock subject to such Award to such proposed transferee; provided further, that the Company shall not be required to recognize any such permitted transfer until such time as such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument in form and substance satisfactory to the Company confirming that such transferee shall be bound by all of the terms and conditions of the Award. References to a Participant, to the extent relevant in the context, shall include references to authorized transferees. For the avoidance of doubt, nothing contained in this Section 11(a) shall be deemed to restrict a transfer to the Company. (b) Documentation. Each Award shall be evidenced in such form (written, electronic or otherwise) as the Board shall determine. Each Award may contain terms and conditions in addition to those set forth in the Plan. (c) Termination of Status. Unless the Board expressly provides otherwise, immediately upon the cessation of a Participant’s Employment (as defined in Section -18-

 
10(b)(1)(v)), (i) each Award requiring exercise that is then held by the Participant or by the Participant’s permitted transferees, if any, will cease to be exercisable and will terminate, and (ii) all other Awards that are then held by the Participant or by the Participant’s permitted transferees, if any, to the extent not already vested will be forfeited, except that: (1) subject to (2) and (3) below, all Options and SARs held by the Participant or the Participant’s permitted transferees, if any, immediately prior to the cessation of the Participant’s Employment with the Company, to the extent then exercisable, will remain exercisable for the lesser of (i) a period of three months and (ii) the period ending on the latest date on which such Option or SAR could have been exercised without regard to this Section 11(c), and will thereupon terminate; (2) all Options and SARs held by a Participant or the Participant’s permitted transferees, if any, immediately prior to the Participant’s death, to the extent then exercisable, will remain exercisable for the lesser of (i) the one year period ending with the first anniversary of the Participant’s death and (ii) the period ending on the latest date on which such Option or SAR could have been exercised without regard to this Section 11(c), and will thereupon terminate; and (3) all Options and SARs held by a Participant or the Participant’s permitted transferees, if any, immediately prior to the cessation of the Participant’s Employment with the Company will immediately terminate upon such cessation if the Board in its sole discretion determines that such cessation of Employment has resulted for reasons which cast such discredit on the Participant as to justify immediate termination of the Award. (d) Withholding. The Participant must satisfy all applicable federal, state, and local or other income and employment tax withholding obligations before the Company will deliver stock certificates or otherwise recognize ownership of Common Stock under an Award. The Company may elect to satisfy the withholding obligations through additional withholding on salary or wages. If the Company elects not to or cannot withhold from other compensation, the Participant must pay the Company the full amount, if any, required for withholding or have a broker tender to the Company cash equal to the withholding obligations. Payment of withholding obligations is due before the Company will issue any shares on exercise, vesting or release from forfeiture of an Award or at the same time as payment of the exercise or purchase price, unless the Company determines otherwise. If provided for in an Award or approved by the Board, a Participant may satisfy the tax obligations in whole or in part by delivery (either by actual delivery or attestation) of shares of Common Stock, including shares retained from the Award creating the tax obligation, valued at their fair market value (valued in the manner determined by (or in a manner approved by) the Company); provided, however, except as otherwise provided by the Board, that the total tax withholding where stock is being used to satisfy such tax obligations cannot exceed the Company’s minimum statutory withholding obligations (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income), except that, to the extent that the Company is able to retain shares of Common Stock having a fair market value (determined by (or in a manner approved by) the Company) that exceeds the statutory minimum applicable withholding tax without material financial accounting implications or the Company is withholding in a jurisdiction that does not have a statutory minimum withholding tax, the -19-

 
Company may retain such number of shares of Common Stock (up to the number of shares having a fair market value equal to the maximum individual statutory rate of tax (determined by (or in a manner approved by) the Company)) as the Company shall determine in its sole discretion to satisfy the tax liability associated with any Award. Shares used to satisfy tax withholding requirements cannot be subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements. (e) Amendment of Award. Except as otherwise provided in Section 5(g) and 6(e), the Board may amend, modify or terminate any outstanding Award, including but not limited to, substituting therefor another Award of the same or a different type, changing the date of exercise or realization, and converting an Incentive Stock Option to a Nonstatutory Stock Option. The The Board may at any time accelerate the vesting or exercisability of an Award, regardless of any adverse or potentially adverse tax consequences resulting from such acceleration. The Participant’s consent to such action shall be required unless (i) the Board determines that the action, taking into account any related action, does not materially and adversely affect the Participant’s rights under the Plan or (ii) the change is permitted under Section 10 or the foregoing sentence. (f) Conditions on Delivery of Stock. The Company will not be obligated to deliver any shares of Common Stock pursuant to the Plan or to remove restrictions from shares previously issued or delivered under the Plan until (i) all conditions of the Award have been met or removed to the satisfaction of the Company, (ii) in the opinion of the Company’s counsel, all other legal matters in connection with the issuance and delivery of such shares have been satisfied, including any applicable securities laws and regulations and any applicable stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Company may consider appropriate to satisfy the requirements of any applicable laws, rules or regulations.. (g) Dividend Equivalents. The Board may provide for the payment of amounts in lieu of cash dividends or other cash distributions (“Dividend Equivalents”) with respect to shares of Common Stock subject to an Award, provided that such Dividend Equivalents shall be subject to the same vesting and forfeiture provisions as the Award with respect to which they may be paid. Any entitlement to dividend equivalents or similar entitlements shall be established and administered consistent either with exemption from, or compliance with the requirements of Section 409A to the extent applicable. 12. Miscellaneous (a) No Right To Employment or Other Status. No person shall have any claim or right to be granted an Award by virtue of the adoption of the Plan, and the grant of an Award shall not be construed as giving a Participant the right to continued Employment. The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan, except as expressly provided in the applicable Award. (b) No Rights As Shareholder; Clawback. Subject to the provisions of the applicable Award, no Participant or Designated Beneficiary shall have any rights as a shareholder with -20-

 
respect to any shares of Common Stock to be issued with respect to an Award until becoming the record holder of such shares. In accepting an Award under the Plan, a Participant shall agree to be bound by any clawback policy the Company has adopted or may adopt in the future, or any other compensation recovery requirements that the Company determines are necessary or appropriate to be applicable to an Award. (c) Effective Date and Term of Plan. The Plan shall become effective on the date the Plan is approved by the Company’s shareholders (the “Effective Date”). No Awards shall be granted under the Plan after the expiration of 10 years from the Effective Date, but Awards previously granted may extend beyond that date. (d) Amendment of Plan. The Board may amend, suspend or terminate the Plan or any portion thereof at any time provided that (i) to the extent required by Section 162(m), no Award granted to a Participant that is intended to comply with Section 162(m) after the date of such amendment shall become exercisable, realizable or vested, as applicable to such Award, unless and until the Company’s shareholders approve such amendment in the manner required by Section 162(m); (ii) no amendment that would require shareholder approval under the rules of the national securities exchange on which the Company then maintains its primary listing may be made effective unless and until the Company’s shareholders approve such amendment; and (iii) if the national securities exchange on which the Company then maintains its primary listing does not have rules regarding when shareholder approval of amendments to equity compensation plans is required (or if the Common Stock is not then listed on any national securities exchange), then no amendment to the Plan (A) materially increasing the number of shares authorized under the Plan (other than pursuant to Section 4(c) or 10), (B) expanding the types of Awards that may be granted under the Plan, or (C) materially expanding the class of participants eligible to participate in the Plan shall be effective unless and until the Company’s shareholders approve such amendment. In addition, if at any time the approval of the Company’s shareholders is required as to any other modification or amendment under Section 422 of the Code or any successor provision with respect to Incentive Stock Options, the Board may not effect such modification or amendment without such approval. Unless otherwise specified in the amendment, any amendment to the Plan adopted in accordance with this Section 12(d) shall apply to, and be binding on the holders of, all Awards outstanding under the Plan at the time the amendment is adopted, provided the Board determines that such amendment, taking into account any related action, does not materially and adversely affect the rights of Participants under the Plan. No Award shall be made that is conditioned upon shareholder approval of any amendment to the Plan unless the Award provides that (i) it will terminate or be forfeited if shareholder approval of such amendment is not obtained within no more than 12 months from the date of grant and (2) it may not be exercised or settled (or otherwise result in the issuance of Common Stock) prior to such shareholder approval. (e) Authorization of Sub-Plans (including for Grants to non-U.S. Employees). The Board may from time to time establish one or more sub-plans under the Plan for purposes of satisfying applicable securities, tax or other laws of various jurisdictions. The Board shall establish such sub-plans by adopting supplements to the Plan containing (i) such limitations on the Board’s discretion under the Plan as the Board deems necessary or desirable or (ii) such additional terms and conditions not otherwise inconsistent with the Plan as the Board shall deem necessary or desirable. All supplements adopted by the Board shall be deemed to be part of the -21-

 
Plan, but each supplement shall apply only to Participants within the affected jurisdiction and the Company shall not be required to provide copies of any supplement to Participants in any jurisdiction which is not the subject of such supplement. (f) Compliance with Section 409A of the Code. Except as provided in individual Award agreements initially or by amendment, if and to the extent (i) any portion of any payment, compensation or other benefit provided to a Participant pursuant to the Plan in connection with his or her employment termination constitutes “nonqualified deferred compensation” within the meaning of Section 409A and (ii) the Participant is a specified employee as defined in Section 409A(a)(2)(B)(i) of the Code, in each case as determined by the Company in accordance with its procedures, by which determinations the Participant (through accepting the Award) agrees that he or she is bound, such portion of the payment, compensation or other benefit shall not be paid before the day that is six months plus one day after the date of “separation from service” (as determined under Section 409A) (the “New Payment Date”), except as Section 409A may then permit. The aggregate of any payments that otherwise would have been paid to the Participant during the period between the date of separation from service and the New Payment Date shall be paid to the Participant in a lump sum on such New Payment Date, and any remaining payments will be paid on their original schedule. The Company makes no representations or warranty and shall have no liability to the Participant or any other person if any provisions of or payments, compensation or other benefits under the Plan are determined to constitute nonqualified deferred compensation subject to Section 409A but do not to satisfy the conditions of that section. (g) Limitations on Liability. Notwithstanding any other provisions of the Plan, no individual acting as a director, officer, employee or agent of the Company will be liable to any Participant, former Participant, spouse, beneficiary, or any other person for any claim, loss, liability, or expense incurred in connection with the Plan, nor will such individual be personally liable with respect to the Plan because of any contract or other instrument he or she executes in his or her capacity as a director, officer, employee or agent of the Company. The Company will indemnify and hold harmless each director, officer, employee or agent of the Company to whom any duty or power relating to the administration or interpretation of the Plan has been or will be delegated, against any cost or expense (including attorneys’ fees) or liability (including any sum paid in settlement of a claim with the Board’s approval) arising out of any act or omission to act concerning the Plan unless arising out of such person’s own fraud or bad faith. (h) Governing Law. The provisions of the Plan and all Awards made hereunder shall be governed by and interpreted in accordance with the laws of the Commonwealth of Massachusetts, excluding choice-of-law principles of the law of such state that would require the application of the laws of a jurisdiction other than the Commonwealth of Massachusetts. In accepting an Award under the Plan, a Participant shall agree that the Award is granted by the Company, with respect to Common Stock issued by the Company, and that any claim with respect to the Award may only be raised against the Company in a court of competent jurisdiction in the Commonwealth of Massachusetts, regardless of whether the Participant is or was employed by the Company or a Subsidiary. -22-

 
STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN [____] Restricted Stock Unit Award Agreement with Performance Criteria Subject to your acceptance of the terms set forth in this agreement and the addendum attached hereto (“Agreement”), State Street Corporation (“Company”) has awarded you, under the State Street Corporation 2017 Stock Incentive Plan (“Plan”), and pursuant to this Agreement and the terms set forth herein, a contingent right to receive the number of shares of Common Stock (the right to receive such Common Stock, “Restricted Stock Units”) (“Award”) as set forth in the statement pertaining to this Award (“Statement”) on the website (“Website”) maintained by Fidelity Stock Plan Services LLC, an independent service provider based in the United States, or another party designated by the Company (“Equity Administrator”). Copies of the Plan, the Company’s Prospectus for the Plan and any employee information supplement to the Prospectus for your country of Employment (“Tax Supplement”) are located on the Website for your reference. Your acceptance of this Award constitutes your acknowledgement that you have read and understood this Agreement, the Plan, the Prospectus for the Plan and the Tax Supplement. The provisions of the Plan are incorporated herein by reference, and all terms used herein shall have the meaning given to them in the Plan, except as otherwise expressly provided herein. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of the Plan shall control. As used herein, “State Street” means the Company and each Subsidiary. “Subsidiary” means the Company’s consolidated subsidiaries. You may consider this Agreement for up to thirty (30) days from the date it was first made available to you on the Website. The terms of your Award are as follows: 1. Grant of Restricted Stock Units. To be entitled to any payment under this Award, you must accept your Award and in so doing agree to comply with the terms and conditions of this Agreement and the applicable provisions of the Countries Addendum outlined in Appendix A (which is incorporated into, and forms a material and integral part of, this Agreement). Failure to accept this Award within thirty (30) days following the posting of this Agreement on the Website will result in forfeiture of this Award. Subject to the terms and conditions of this Agreement, Restricted Stock Units shall vest on the vesting and payment date described in Section 2. The term “vest” as used herein means the lapsing of certain (but not all) restrictions described herein and in the Plan with respect to one or more Restricted Stock Units. To vest in all or any portion of this Award as of any date, you must have been continuously employed with the Company or a Subsidiary from and after the date hereof and until (and including) the applicable vesting date, except as otherwise provided herein. By accepting this Award, you acknowledge and agree that with respect to any claim you may undertake to raise in the future with respect to this Award of Restricted Stock Units or Common Stock issued by the Company with respect to this Agreement may only be raised against the Company in a court of competent jurisdiction in the Commonwealth of 1

 
Massachusetts, regardless of where or whether you are employed by the Company or a Subsidiary. This Award is subject to any forfeiture, compensation recovery or similar requirements set forth in this Agreement, as well as any other forfeiture, compensation recovery or similar requirements under applicable law and related implementing regulations and guidance, and to other forfeiture, compensation recovery or similar requirements under plans, policies and practices of the Company or its relevant Subsidiaries in effect from time to time, including those set forth in your offer letter. In the event pursuant to this Agreement or pursuant to any applicable law or related implementing regulations or guidance, or pursuant to any Company or its relevant Subsidiaries plans, policies or practices, the Board or State Street is required or permitted to reduce, forfeit or cancel any amount remaining to be paid, or to recover any amount previously paid, with respect to this Award, or to otherwise impose or apply restrictions on this Award or shares of Common Stock subject hereto, it shall, in its sole discretion, be authorized to do so. By accepting this Award, you consent to making payment to the Subsidiary that legally employs you (“Employer”) in the event of a compensation recovery determination by the Board or State Street. 2. Performance Targets; Board Certification; Form of Payment. Whether your Award will be paid and in what amounts will depend on achievement of average return on equity and average pre-tax margin, both as defined in the attached Exhibit I (which is incorporated into, and forms a material and integral part of, this Agreement), during the three (3) calendar years during the Performance Period, as defined in the attached Exhibit I, and the other terms and conditions as set forth herein. Payment under this Award will only be made if the Board certifies, following the close of the Performance Period, that the pre-established threshold performance targets have been met or exceeded, and then only to the extent of the level of performance so certified as having been achieved. Any portion of this Award earned by reason of the Board’s certification as described above will vest and be paid in Common Stock to you (or your Designated Beneficiary, in the case of your death) in one single installment between February 15 and March 15 of the calendar year beginning after the end of the Performance Period (unless you have been notified by the Company or any Subsidiary that you have been designated as a Risk Manager or a Senior Manager for the purposes of Article 15.17(1)(b) or (c) of the Rulebook of the UK Prudential Regulation Authority (“PRA”) in which case different terms and conditions relating to vesting and payment of this Award shall apply to you). The total number of shares of Common Stock to be paid will be determined by multiplying the number of Restricted Stock Units referred to in your Statement by the Total Vesting Percentage, as defined and set forth on the attached Exhibit I and certified by the Board. Notwithstanding the foregoing, the Company may, in its sole discretion, settle any vested Award in the form of: (i) a cash payment to the extent settlement in shares of Common Stock (1) is prohibited under local law, rules or regulations, (2) would require you, the Company or your Employer to obtain the approval of any governmental and/or regulatory body in your country of residence (or 2

 
country of Employment, if different), or (3) is administratively burdensome; or (ii) shares of Common Stock, but require you to immediately sell such shares of Common Stock (in which case, you hereby expressly authorize the Company to issue sales instructions on your behalf). 3. Identified Staff Holding Requirement. Notwithstanding anything herein to the contrary, you agree and covenant that, as a condition to the receipt of this Award and the settlement of the Restricted Stock Units in the form of shares of Common Stock hereunder, in the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated Identified Staff for purposes of the Capital Requirements Directive IV (or any implementing or successor rule, regulation or guidance, including the rules and regulations of the United Kingdom Financial Conduct Authority (“FCA”), Prudential Regulation Authority (“PRA”), German Federal Financial Supervisory Authority (“BaFin”) or any other applicable regulatory authority), you will not sell or otherwise transfer any shares of Common Stock issued and transferred to you pursuant to this Award until the date that is at least twelve (12) months for UK and State Street Bank International GmbH (“SSB Intl GmbH”) Identified Staff (or such longer period as is stipulated by the FCA, the PRA, BaFin or any other applicable regulatory authority) after the vesting date of the shares of Common Stock paid in connection with this Award (“Release Date”), except that (a) you shall be permitted to sell, prior to the Release Date, a number of shares of Common Stock sufficient to pay applicable tax and social security withholding, if any, with respect to such vesting (or, alternatively, if the Company withholds such shares pursuant to Section 12 of this Agreement, the requirements in this Section 3 not to sell or otherwise transfer any shares shall only apply to the number of such shares delivered to you (i.e., after such withholding of shares)), (b) transfers by will or pursuant to the laws of descent or distribution are permitted and (c) this holding requirement shall not apply to such portion of the shares of Common Stock, if any, that were awarded with respect to a period of time, as determined by the Company in its discretion, during which you were not subject to such holding requirement. Any attempt by you (or in the case of your death, by your Designated Beneficiary) to assign or transfer shares of Common Stock subject to this Award, either voluntarily or involuntarily, contrary to the provisions hereof, shall be null and void and without effect. The Company may, in its sole discretion, impose restrictions on the assignment or transfer of shares of Common Stock consistent with the provisions hereof, including, without limitation, by or through the transfer agent for such shares or by means of legending Common Stock certificates or otherwise. This provision applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 4. General Circumstances of Forfeiture. (a) You will immediately forfeit any and all rights to receive shares of Common Stock under this Agreement not previously vested, issued and transferred to you in the event: (i) you cease to be employed by the Company and its Subsidiaries due to Circumstances of Forfeiture; (ii) your Employer, in its sole discretion, determines that circumstances prior to the date on which you ceased to be employed by 3

 
the Company and its Subsidiaries for any reason constituted grounds for an involuntary termination constituting Circumstances of Forfeiture; or (iii) you fail to comply with the terms of the applicable Countries Addendum attached to this Award or the terms of any other Restrictive Covenant (as defined in the Countries Addendum) you agree to or have agreed to with the Company or your Employer. (b) If your Employment terminates by reason of [Retirement or] Disability or any reason other than for Circumstances of Forfeiture, then you shall be eligible to receive a payment under this Award subject to the certification of the Board in accordance with Section 2, subject to the terms and conditions of this Agreement. Unless accelerated as provided in Section 9, any amount payable pursuant to this Section 4 shall be paid in accordance with Section 2. (c) For purposes hereof: (i) “Circumstances of Forfeiture” means the termination of your Employment with the Company and its Subsidiaries either (A) voluntarily (other than [(x) Retirement or (y)] for Good Reason on or prior to the first anniversary of a Change in Control) or (B) involuntarily for reasons determined by the Company or the relevant Subsidiary in its sole discretion to constitute “gross misconduct” [(including while you are Retirement eligible)]. (ii) [“Retirement” means your attainment of age 55 and completion of 5 years of continuous service with the Company and its Subsidiaries. (iii) ]“Disability” means your inability to engage in any substantially gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in your death or can be expected to last for a continuous period of not less than 12 months. (d) If you are a local national of and employed in a country that is a member of the European Union (“EU”), the grant of this Award and the terms and conditions governing this Award are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent a court or tribunal of competent jurisdiction determines that any provision of this Award is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under applicable local law. (e) This Section 4 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 5. Material Risk Taker Malus-Based Forfeiture. In the event you hold a title of Senior Vice President or higher during the calendar year in which this Award is made, or you hold the status of “material risk taker” at the time this Award is made or any time thereafter, you acknowledge and agree that this Award is subject to the provisions of this Section 5. In respect of any Award remaining to be issued and transferred to you in Common Stock or otherwise paid may, in the sole discretion of the Board, be reduced, forfeited or cancelled, in the event that it is determined by the Board, in its sole discretion, that your actions, whether discovered 4

 
during or after your employment with the Employer, exposed The Business to any inappropriate risk or risks (including where you failed to timely identify, analyze, assess or raise concerns about such risk or risks, including in a supervisory capacity, where it was reasonable to expect you to do so), and such exposure has resulted or could reasonably be expected to result in a material loss or losses that are or would be substantial in relation to the revenues, capital and overall risk tolerance of The Business. “The Business” shall mean State Street, or, to the extent you devote substantially all of your business time to a particular business unit (e.g., Global Services Americas, Global Services International, State Street Global Exchange or State Street Sector Solutions) or business division (e.g., Alternative Investment Solutions, Securities Lending), “Business” shall refer to such business unit or business line. This provision applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 6. Identified Staff Malus-Based Forfeiture and Clawback. (a) In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated Identified Staff for purposes of the PRA Remuneration Code, you acknowledge and agree that this Award is subject to the provisions of this Section 6 for a period of seven (7) years from the date this Award is granted. The seven (7)-year period may be extended to ten (10) years in certain circumstances where (i) the Company has commenced an investigation into facts or events which it considers could potentially lead to the application of a clawback under this Section 6 were it not for the expiration of the seven (7)-year period; or (ii) the Company has been notified by a regulatory authority that an investigation has commenced into facts or events which the Company considers could potentially lead to the application of clawback by the Company under this Section 6 were it not for the expiration of the seven (7)-year period. (b) If the Company determines that a PRA Forfeiture Event has occurred it may elect to reduce, forfeit or cancel all or part of any amount remaining to be issued and transferred to you in Common Stock or otherwise paid in respect of this Award (“PRA Malus-Based Forfeiture”). (c) If the Company determines that a PRA Clawback Event has occurred it may require the repayment by you (or otherwise seek to recover from you) of all or part of any compensation paid to you in respect of this Award. (d) The Company may produce guidelines from time to time in respect of its operation of the provisions of this Section 6. The Company intends to apply such guidelines in deciding whether and when to effect any reduction, cancellation, forfeiture or recovery of compensation but, in the event of any inconsistency between the provisions of this Section 6 and any such guidelines, this Section 6 shall prevail. Such guidelines do not form part of any employee’s contract of Employment, and the Company may amend such guidelines and their application at any time. (e) By accepting this Award on the Website, you expressly and explicitly (i) consent to making the required payment to the Company (or to your Employer on behalf of the Company)upon a PRA Clawback Event; and 5

 
(ii) authorize the Company to issue related instructions, on your behalf, to the Equity Administrator and any brokerage firm and/or third party administrator engaged by the Company to hold your shares of Common Stock and other amounts acquired under the Plan and to re-convey, transfer or otherwise return such shares of Common Stock and/or other amounts to the Company. (f) For the purposes of this Section 6: (i) A “PRA Forfeiture Event” means a determination by the Company, in its sole discretion, that (A) there is reasonable evidence of your misbehavior or material error; or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material downturn in its financial performance; or (C) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management. (ii) A “PRA Clawback Event” means a determination by the Company, in its sole discretion, that either (A) there is reasonable evidence of your misbehavior or material error or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management. (g) This Section 6 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 7. SSB Intl GmbH and SSGA GmbH Affordability Limitations, and Malus- Based Forfeiture and Clawback. (a) Awards issued to SSB Intl GmbH or State Street Global Advisors GmbH staff may be impacted by the financial situation of the bank and/or regulatory group, as prescribed by regulatory requirements in its applicable version (e.g. the Remuneration Ordinance for Institutions and/or German Banking Act). Awards may also be limited to the extent ordered by the competent supervisory authority according to sec. 45 para. 2 sentence 1 no. 5a, 6 German Banking Act. Further, entitlement to an Award may lapse if the competent supervisory authority issues a corresponding definitive order according to sec. 45 para. 5 sentence 5 to 8 German Banking Act. (b) In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated SSB Intl GmbH Identified Staff for purposes of the German Remuneration Ordinance, you acknowledge and agree that this Award is subject to forfeiture and clawback for a period from the date the Award is granted until two (2) years from the date that the final tranche of this Award vests. A clawback applies if you, as SSB Intl GmbH Identified Staff, (i) contributed significantly to, or was responsible for, conduct that resulted in significant losses or regulatory sanctions for SSB Intl GmbH, or (ii) is responsible for a serious breach of relevant external or internal rules on good conduct (“SSB Intl GmbH Identified Staff Clawback Event”). (c) Section 7 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 6

 
8. Management Committee/Executive Vice President Forfeiture and Clawback. (a) If, at the time the Award is made, you are a member of the State Street Corporation Management Committee or any successor committee or body (“Management Committee” or “MC”) or hold the title Executive Vice President (“EVP”) or higher, any amount remaining to be paid in respect of this Award may, in the sole discretion of the Board, be reduced, forfeited or cancelled, in whole or in part, in the event that it is determined by the Board, in its sole discretion, that: (i) you engaged in fraud, gross negligence or any misconduct, including in a supervisory capacity, that was materially detrimental to the interests or business reputation of State Street or any of its businesses; or (ii) you engaged in conduct that constituted a violation of State Street policies and procedures or State Street Standard of Conduct in a manner which either caused or could have caused reputational harm that is material to State Street or placed or could have placed State Street at material legal or financial risk; or (iii) as a result of a material financial restatement by State Street contained in a filing with the U.S. Securities and Exchange Commission (“SEC”), or miscalculation or inaccuracy in the determination of performance metrics, financial results or other criteria used in determining the amount of this Award, you would have received a smaller or no Award hereunder. (b) If, at the time the Award is made, you are a member of the Management Committee or hold the title EVP or higher, this Award also is subject to compensation recovery as provided herein. Upon the occurrence of an MC/EVP Clawback Event within four (4) years after the date of grant of this Award or within one (1) year of the vesting and payment date of this Award, the Board may, in its sole discretion, determine to recover the MC/EVP Clawback Amount, in whole or in part. Following such a determination, you agree to immediately repay such compensation, in no event later than sixty (60) days following such determination, in the form of any shares of Common Stock delivered to you previously by the Company or cash (or a combination of such shares and cash). For purposes of calculating the value of both: (i) the amount of the MC/EVP Clawback Amount determined by the Board to be recovered; and (ii) the amount of such compensation repaid, shares of Common Stock will be valued in an amount equal to the market value of the shares of Common Stock delivered to you under this Award by the Company as determined at the time of such delivery. To the extent not prohibited by applicable law and subject to Section 16 (if applicable), if you fail to comply with any requirement to repay compensation under this Section 8(b), the Board may determine, in its sole discretion, in addition to any other remedies available to the Company, that you will satisfy your repayment obligation through an offset to any future payments owed by the Company or any of its Subsidiaries to you. (c) For purposes of this Section 8: 7

 
(i) “MC/EVP Clawback Event” means a determination by the Board, in its sole discretion, (A) with respect to any event or series of related events, that you engaged in fraud or willful misconduct, including in a supervisory capacity, that resulted in financial or reputational harm that is material to State Street and resulted in the termination of your Employment by the Company and its Subsidiaries (or, following a cessation of your Employment for any other reason, such circumstances constituting grounds for termination are determined applicable) or (B) a material financial restatement or miscalculation or inaccuracy in financial results, performance metrics, or other criteria used in determining this Award by State Street occurred. For the avoidance of doubt and as applicable, an MC/EVP Clawback Event includes any determination by the Board that is based on circumstances prior to the date on which you cease to be employed by the Company and its Subsidiaries for any reason, even if the determination by the Board occurs after such cessation of Employment. (ii) “MC/EVP Clawback Amount” means (A) with respect to an MC/EVP Clawback Event described in Section 8(c)(i)(A), the value of the shares of Common Stock, determined under Section 8(b) above, that were delivered to you under this Award by the Company prior to such MC/EVP Clawback Event or (B) with respect to an MC/EVP Clawback Event described in Section 8(c)(i)(B), the value of the shares of Common Stock, determined under Section 8(b) above, that were delivered to you under this Award by the Company (x) prior to an associated date designated by the Board and (y) that represents an amount that, in the sole discretion of the Board, exceeds the amount you would have been awarded under this Award had the financial statements or other applicable records of State Street been accurate (reduced, in the case of both of the immediately preceding clauses (A) and (B), taking into account any portion of this Award that was previously recovered by the Company under Section 8(b) to avoid a greater than 100% recovery). (d) In connection with any MC/EVP Clawback Event, you hereby expressly and explicitly authorize the Company to issue instructions, on your behalf, to the Equity Administrator and any brokerage firm and/or third party administrator engaged by the Company to hold your shares of Common Stock and other amounts acquired under the Plan to re-convey, transfer or otherwise return such shares of Common Stock and/or other amounts to the Company. (e) This Section 8 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 9. Change in Control; Acceleration of Performance Award. Subject to applicable law and regulation (including the rules and regulations of any applicable regulatory authority): (a) in the case of a Change in Control occurring (i) in [the first calendar year], the Total Vesting Percentage shall be 100%, 8

 
(ii) in [the second calendar year], the Total Vesting Percentage shall be based upon (A) the simple average of the actual return on equity results for the [first] calendar year, adjusted in accordance with the Plan, and [applicable %] for each of [the first and second calendar years] and (B) the simple average of pre-tax margin results for the [first] calendar year, adjusted in accordance with the Plan, and [applicable %] for each of [first and second calendar years], and (iii) in [the third calendar year], the Total Vesting Percentage shall be based upon (A) the simple average of the actual return on equity results, adjusted in accordance with the Plan, for each of the [first and second] calendar years and [applicable %] for [the third calendar year] and (B) the simple average of pre-tax margin results, adjusted in accordance with the Plan, for each of the [first and second] calendar years and [applicable %] for [the third calendar year]. (b) If, prior to the full settlement of your Award, your employment with the Company and its Subsidiaries is terminated by the Company or the applicable Subsidiary without Cause (as defined in the Plan) or by you for Good Reason (as defined in the Plan) [or on account of your Retirement], in each case, during the one- year period following a Change in Control, you shall be entitled within 30 days of such termination to receive a cash payment equal to the adjusted fair market value of a share of the Common Stock (1) multiplied by the number of units referred to in your Statement and (2) further multiplied by the Total Vesting Percentage (which shall be calculated in accordance with clause (a) above in the case of a Change in Control occurring prior to the end of the Performance Period); provided, to the extent an Award or any portion thereof constitutes “nonqualified deferred compensation” within the meaning of Section 409A of the Code, that such Change in Control constitutes a “change in control event” as that term is defined under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, (“Code”) and Treasury Regulation 1.409A-3(i)(5). For purposes of the preceding sentence, “adjusted fair market value” shall mean the higher of the (i) the highest average of the reported daily high and low prices per share of the Common Stock during the sixty (60)-day period prior to the first date of actual knowledge by the Board of the circumstances that resulted in a Change in Control, and (ii) if the Change in Control is the result of a transaction or series of transactions described in paragraph 1 or 2 of the definition of Change in Control in the Plan, the highest price per share of the Common Stock paid in such transaction or series of transactions (which in the case of a transaction described in paragraph 1 of such definition in the Plan shall be the highest price per share of the Common Stock as reflected in a Schedule 13D filed by the person having made the acquisition). For purposes of this Section 9, termination of employment shall mean a “separation from service” as determined in accordance with Treasury Regulation Section 1.409A-1(h). 10. Amendments to Restricted Stock Units. Subject to the specific limitations set forth in the Plan, the Board may at any time suspend or terminate any rights or obligations relating to this Award prior to the full settlement of your Award without your consent. 9

 
11. Shareholder Rights. You are not entitled to any rights as a shareholder with respect to any shares of Common Stock subject to this Award until they are transferred to you. Without limiting the foregoing, prior to the issuance and transfer to you of shares of Common Stock pursuant to this Agreement, you will have no right to receive dividends or amounts in lieu of dividends with respect to the shares of Common Stock subject to this Award nor any right to vote the shares of Common Stock prior to any shares being transferred to you. 12. Withholding of Tax-Related Items. Regardless of any action your Employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account of other tax-related withholding (“Tax-Related Items”), you acknowledge and agree that the ultimate liability for all Tax-Related Items legally due from you is and remains your responsibility. Furthermore, neither the Company nor your Employer (a) makes any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this Award, including the grant of this Award, the vesting of this Award and the issuance of shares of Common Stock in settlement of this Award, the subsequent sale of any shares of Common Stock delivered upon settlement of this Award, the cancellation, forfeiture or repayment of any shares of Common Stock (or cash in lieu thereof) or the receipt of any dividends or dividend equivalents; or (b) commits to structure the terms of the grant, vesting, settlement, cancellation, forfeiture, repayment or any other aspect of this Award to reduce or eliminate your liability for Tax-Related Items. Prior to the delivery of shares of Common Stock upon the vesting of this Award, if any taxing jurisdiction requires withholding of Tax-Related Items in connection with the Award, the Company may withhold a sufficient number of whole shares of Common Stock that have an aggregate fair market value sufficient to pay the Tax-Related Items required to be withheld with respect to this Award; provided, however, that the total tax withholding cannot exceed the Employer’s minimum statutory withholding obligations (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income). The cash equivalent of the shares of Common Stock withheld will be used to settle the obligation to withhold the Tax-Related Items (determined in the Company’s reasonable discretion). No fractional shares of Common Stock will be withheld or issued pursuant to the issuance of Common Stock hereunder. Alternatively, the Company and/or your Employer may, in its discretion, withhold any amount necessary to pay the Tax-Related Items from your salary, wages or other amounts payable to you, with no withholding in shares of Common Stock. In the event the withholding requirements are not satisfied through the withholding of shares or through your salary, wages or other amounts payable to you, no shares of Common Stock will be issued upon vesting of this Award unless and until satisfactory arrangements (as determined by the Company or your Employer) have been made by you with respect to the payment of any Tax-Related Items which the Company or your Employer determines, in its sole discretion, must be withheld or collected with respect to such Award. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering any applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. If you are subject to taxation in more than one jurisdiction, you hereby expressly acknowledge that the Company, your 10

 
Employer or another Subsidiary may be required to withhold and/or account for Tax- Related Items in more than one jurisdiction. By accepting this Award, you hereby expressly consent to the withholding of shares of Common Stock and/or cash as provided for hereunder. All other Tax-Related Items related to this Award and any Common Stock delivered in payment thereof, including the extent to which the Company or your Employer does not so-withhold shares of Common Stock and/or cash, are your sole responsibility. 13. Changes in Capitalization or Corporate Structure. This Award is subject to adjustment pursuant to Section 10(a) of the Plan in the circumstances therein described. 14. Employee Rights. Nothing in this Award shall be construed to guarantee you any right of Employment with the Company, your Employer or any Subsidiary or to limit the discretion of any of them to terminate your Employment at any time, with or without cause, to the maximum extent permitted under local law. In consideration of the grant of the Award, you acknowledge and agree that you will have no entitlement to compensation or damages in consequence of the termination of your Employment (for any reason whatsoever and whether or not in breach of contract or local labor laws), insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Award as a result of such termination, or from the loss or diminution in value of the Award. By accepting this Award, you shall be deemed irrevocably to have waived any such claim or entitlement against the Company, your Employer and all Subsidiaries that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by accepting this Agreement, you shall be deemed irrevocably to have waived your entitlement to pursue such claim. In the event your Employment ends and you are subsequently rehired by the Company or any Subsidiary, no Award previously forfeited or recovered will be reinstated. 15. Non - Transferability, Etc. This Award shall not be transferable other than (1) by will or the laws of descent and distribution or (2) pursuant to the terms of a court-approved domestic relations order, official marital settlement agreement or other divorce or settlement instrument satisfactory to State Street, in its sole discretion. In the case of transfer pursuant to (2) above, this Award shall remain subject to all the terms and conditions contained in the Plan and this Agreement, including vesting, forfeiture and clawback terms and conditions. Any attempt by you (or in the case of your death, by your Designated Beneficiary) to assign or transfer this Award, either voluntarily or involuntarily, contrary to the provisions hereof, shall be null, void and without effect and shall render this Award itself null and void. 16. Compliance with Section 409A of the Code. (a) The provisions of this Award are intended to be exempt from, or compliant with, Section 409A of the Code, and shall be construed and interpreted consistently therewith. Notwithstanding the foregoing, neither the Company nor any 11

 
Subsidiary shall have any liability to you or to any other person if this Award is not so exempt or compliant. (b) If and to the extent (i) any portion of any payment, compensation or other benefit provided to you pursuant to the Plan in connection with your Employment termination constitutes “nonqualified deferred compensation” within the meaning of Section 409A of the Code, and (ii) you are a specified employee as defined in Section 409A(a)(2)(B)(i) of the Code, in each case as determined by the Company in accordance with its procedures, by which determinations you (through accepting this Award) agree that you are bound, such portion of the payment, compensation or other benefit shall not be paid before the day that is six months plus one day after the date of “separation from service” (as determined under Section 409A of the Code) (the “New Payment Date”), except as Section 409A of the Code may then permit. The aggregate of any payments that otherwise would have been paid to you during the period between the date of separation from service and the New Payment Date shall be paid to you in a lump sum on such New Payment Date, and any remaining payments will be paid on their original deferral schedule. 17. Miscellaneous. (a) Awards Discretionary. By accepting this Award, you acknowledge and agree that the Plan is discretionary in nature and limited in duration, and may be amended, cancelled, forfeited, or terminated by the Company, in its sole discretion, at any time. The grant of this Award is a one-time benefit and does not create any contractual or other right to receive an award, compensation or benefits in lieu of an award in the future. Future awards, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of an award, the number of shares of Common Stock subject to an award, performance criteria, and forfeiture, clawback and vesting provisions. (b) Company and Committee Discretion. Sections 3, 4, 5, 6, 7 and 8 of this Agreement are intended to comply with and meet the requirements of applicable law and related implementing regulations regarding incentive compensation and will be interpreted and administered accordingly as well as in accordance with any implementing policies and practices of the Company or its relevant Subsidiaries in effect from time to time. In making determinations under such Sections, the Company, the relevant Subsidiary or the Board, as applicable, may take into account, in its sole discretion, all factors that it deems appropriate or relevant. Furthermore, the Company, the relevant Subsidiary or the Board may, as applicable, take any and all actions it deems necessary or appropriate in its sole discretion, as permitted by applicable law, to implement the intent of Sections 4, 5, 6, 7 and 8, including suspension of vesting and payment pending an investigation or the determination by the Company, the relevant Subsidiary or the Board, as applicable. Each such Section is without prejudice to the provisions of the other Sections, and the Company, the relevant Subsidiary or the Board as applicable, may elect or be required to apply any or all of the provisions of Sections 3, 4, 5, 6, 7 and 8 to this Award. Sections 3, 4, 5, 6, 7 and 8 of this Agreement shall cease to apply upon your death at any time provided, however, if a PRA Clawback Event, SSB 12

 
Intl GmbH Identified Staff Clawback Event or an MC/EVP Clawback Event has occurred pursuant to Section 6, 7 or 8, respectively, at or prior to your death, any amount that the Board has made a determination to recover under either such Section shall continue to be payable to the Company. (c) Voluntary Participation. Your participation in the Plan is voluntary. The value of this Award is an extraordinary item of compensation, is outside the scope of your employment contract, if any, and is not part of your normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension, or retirement benefits or similar payments. (d) Electronic Delivery. The Company or any of its Subsidiaries may, in its sole discretion, decide to deliver any documents related to this Award by electronic means. You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system, including the Website, established and maintained by the Company, any of its Subsidiaries, the Equity Administrator or another party designated by the Company. (e) Electronic Acceptance. By accepting this Award electronically, (i) you acknowledge and agree that you are bound by the terms of this Agreement and the Plan and that you and this Award are subject to all of the rights, power and discretion of the Company, its Subsidiaries and the Board set forth in this Agreement and the Plan; and (ii) this Award is deemed accepted by the Company and the Company shall be deemed to be bound by the terms of this Agreement. (f) Language. You acknowledge and agree that it is your express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to this Award, be drawn up in English. If you have received this Agreement, the Plan or any other documents related to this Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will prevail to the extent permitted under local law. (g) Additional Requirements. The Company reserves the right to impose other requirements on this Award, any shares of Common Stock acquired pursuant to this Award, and your participation in the Plan, to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local laws, rules and regulations or to facilitate the operation and administration of this Award and the Plan. Such requirements may include (but are not limited to) requiring you to sign any agreements or undertakings that may be necessary to accomplish the foregoing. Further, issuance of Common Stock hereunder is subject to compliance by the Company and you with all legal requirements applicable thereto, including compliance with the requirements of 12 C.F.R. Part 359, and with all applicable regulations of any stock exchange on which the Common Stock may be listed at the time of issuance. (h) Public Offering. If you are a resident and/or employed outside the United States, the grant of this Award is not intended to be a public offering of securities in your country of residence (and country of Employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local 13

 
securities authorities (unless otherwise required under local law), and the grant of this Award is not subject to the supervision of the local securities authorities. (i) Limitation of Liability. No individual acting as a director, officer, employee or agent of the Company or any of its Subsidiaries will be liable to you or any other person for any action, including any Award forfeiture, Award recovery or other discretionary action taken pursuant to this Agreement or any related implementing policy or procedure of the Company. (j) Insider Trading. By participating in the Plan, you agree to comply with the Company’s policy on insider trading (to the extent that it is applicable to you). You further acknowledge that, depending on your country of residence (and country of Employment, if different) or your broker’s country of residence or where the shares of Common Stock are listed, you may be subject to insider trading restrictions and/or market abuse laws which may affect your ability to accept, acquire, sell or otherwise dispose of the shares of Common Stock, rights to shares of Common Stock (e.g., this Award) or rights linked to the value of shares of Common Stock, during such times you are considered to have “inside information” regarding the Company (as defined by the laws or regulations in your country of residence (and country of Employment, if different). Local insider trading laws and regulations may prohibit the cancellation, forfeiture or amendment of orders you place before you possess inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party (other than on a “need to know” basis) and (ii) “tipping” third parties or causing them otherwise to buy or sell securities. You understand that third parties include fellow employees. Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. You hereby expressly acknowledge that it is your responsibility to be informed of and compliant with such regulations, and should consult with your personal advisor for additional information. (k) Exchange Rates. Neither the Company, your Employer or any Subsidiary shall be liable for any foreign exchange rate fluctuation, where applicable, between your local currency and the United States dollar that may affect the value of an Award or of any amounts due to you pursuant to the settlement of this Award or the subsequent sale of any shares of Common Stock acquired under the Plan. (l) Applicable Law. This Agreement shall be subject to and governed by the laws of the Commonwealth of Massachusetts, United States of America without regard to that Commonwealth’s conflicts of law principles. 18. Application of Local Law and Countries Addendum. (a) Notwithstanding Section 17(l), this Award shall be subject to all applicable laws, rules and regulations of your country of residence (and country of Employment, if different) and any special terms and conditions for your country of residence (and country of Employment, if different), including as set forth in the addendum that follows this Agreement (“Countries Addendum”), but limited to the extent required by local law. The Company reserves the right, in its sole discretion, to add to or amend the terms and conditions set out in the Countries Addendum as necessary or advisable in order to comply with applicable laws, rules and regulations or to facilitate the operation and administration of this Award and the Plan, including (but not limited to) circumstances where you transfer residence and/or Employment to another country. 14

 
(b) As a condition to this Award, you agree to repatriate all payments attributable to the Common Stock acquired under the Plan in accordance with local foreign exchange rules and regulations in your country of residence (and country of Employment, if different). In addition, you also agree to take any and all actions, and consent to any and all actions taken by the Company and its Subsidiaries, as may be required to allow the Company and its Subsidiaries to comply with local laws, rules and regulations in your country of residence (and country of Employment, if different). Finally, you agree to take any and all actions as may be required to comply with your personal legal, tax and other obligations under local laws, rules and regulations in your country of residence (and country of Employment, if different). 19. Data Privacy. The Company is located at One Lincoln Street, Boston, Massachusetts, U.S.A. and grants Awards under the Plan to employees of the Company and its Subsidiaries in its sole discretion. You should carefully review the following information about the Company’s data privacy practices in relation to your Award. (a) Data Collection, Processing and Usage. Pursuant to applicable data protection laws, you are hereby notified that the Company and your Employer collect, process and use certain personal data about you for the legitimate interest of implementing, administering and managing the Plan and generally administering Awards; specifically, including your name, home address, email address and telephone number, date of birth, social security number, social insurance number or other identification number, salary, citizenship, job title, any shares of Common Stock or directorships held in the Company, and details of all Awards or any other incentive compensation awards granted, canceled, forfeited, exercised, vested, or outstanding in your favor, which the Company receives from you or your Employer. In granting Awards under the Plan, the Company will collect your personal data for purposes of allocating Awards and implementing, administering and managing the Plan. The Company’s collection, processing and use of your personal data is necessary for the performance of the Company’s contractual obligations under the Plan and pursuant to the Company’s legitimate interest of managing and generally administering employee incentive compensation awards. Your refusal to provide personal data would make it impossible for the Company to perform its contractual obligations and may affect your ability to participate in the Plan. As such, by participating in the Plan, you voluntarily acknowledge the collection, processing and use of your personal data as described herein. (b) Equity Administrator. The Company transfers your personal data to the Equity Administrator, which assists the Company with the implementation, administration and management of the Plan. In the future, the Company may select a different Equity Administrator and share your personal data with another company that serves in a similar manner. The Equity Administrator will open an account for you to track your Award and to ultimately receive and trade shares of Common Stock acquired under the Plan. You will be asked to agree on separate terms and acknowledge data processing practices with the Equity Administrator, which is a condition to your ability to participate in the Plan. (c) Data Retention. The Company will use your personal data only as long as is necessary to implement, administer and manage your participation in the Plan or as required to comply with legal or regulatory obligations, including under tax and 15

 
security laws. When the Company no longer needs your personal data, the Company will remove it from its systems. If the Company keeps your data longer, it would be to satisfy legal or regulatory obligations and the Company’s legal basis would be for compliance with relevant laws or regulations. For further information about the processing of your personal data, please see the GHR Privacy Notice. * * * * * 16

 
Exhibit I [____] Performance-Based Restricted Stock Unit Awards o Performance Period: The three (3) calendar years commencing January 1, [____] and ending on December 31, [____]. o The number of Restricted Stock Units eligible to vest is based 50% on the three- year simple average of the return on equity (“Average ROE”) and 50% on the three-year simple average of pre-tax margin (“Average Margin”), each as determined under Generally Accepted Accounting Principles for each calendar year of the period from January 1, [___] to December 31, [___] (the “Performance Period”), adjusted to reflect events or items identified by the Board (“Calculation Adjustments”) such as (i) any formally adopted change in, or elimination or addition of, an accounting standard or principle, or any change in the interpretation thereof, whether identified as a change, error, correction or otherwise denominated, by the Financial Accounting Standards Board, the Securities Exchange Commission or its staff, the Public Company Accounting Oversight Board, or any other competent accounting or regulatory body, as determined by the Board based on objective information; (ii) any non- discretionary change in tax or bank regulatory laws, rules, final regulations or other binding interpretations or guidance issued by a competent regulatory body; (iii) any acquisition, disposition, joint venture or restructuring by the Company of a business or portion thereof, however structured in any year during the Performance Period; (iv) any merger and integration expenses in any year during the Performance Period; (v) any restructuring expenses (e.g., cost of workforce reductions, facilities or lease abandonments, asset impairments) in any year during the Performance Period; (vi) any impact (dilution and associated initial and ongoing expenses) of share buybacks (or cancellations of share buybacks) or securities issuances (debt or equity) to finance, or in contemplation of, acquisitions or ventures in any year during the Performance Period; and (vii) any settlement, charge or other payment made with respect to any litigation or regulatory matter arising from events that occurred prior to the Performance Period; provided, however, that for the avoidance of doubt, the Board retains the discretionary right to disregard any Calculation Adjustment that would result in an increase to Average ROE or to Average Margin and to reduce any Award for any Performance Period for other material events or items that affect performance. o The Total Vesting Percentage will be determined by reference to the percentages listed in Tables 1 and 2 below opposite the Average ROE and Average Margin, respectively (the “Vesting Percentage”). The Vesting Percentage for the Average ROE and for the Average Margin will be determined under Tables 1 and 2, respectively, using linear interpolation to adjust between percentage points and rounding up to the nearest one-tenth of one percent, as determined by the Board in its sole discretion. The Average ROE Vesting Percentage and the Average Margin Vesting Percentage will be added together to determine the Total Vesting Percentage. Table 1: Average ROE Vesting Percentage 17

 
Three-year Average ROE Average ROE Vesting Percentage [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] Table 2: Average Margin Vesting Percentage Three-year Average Margin Vesting Average Margin Percentage [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] [applicable %] APPENDIX A COUNTRIES ADDENDUM TO [____] RESTRICTED STOCK UNIT AWARD AGREEMENT 18

 
STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN A. United States B. Australia C. Austria D. Belgium E. Brazil F. Canada G. Cayman Islands H. China I. Denmark J. France K. Germany L. Hong Kong M. India N. Ireland O. Italy P. Japan Q. Jersey R. Luxembourg S. Netherlands T. Norway U. Poland V. Singapore W. South Africa X. Switzerland Y. Taiwan Z. United Arab Emirates AA. United Kingdom A. UNITED STATES ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with the Company and its Subsidiaries. Failure to comply with the terms and conditions of this Countries Addendum A may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. In addition, your eligibility to participate in the Plan in the future, including any potential future grants of awards under the Plan (or any successor incentive plan of the Company), is subject to and conditioned on your compliance with the terms and conditions of this Countries Addendum A. 19

 
This Countries Addendum A contains a covenant not to compete in Paragraph 5 which shall apply to you at any time that you hold the title of Executive Vice President or higher. You should review it carefully. You may consult with an attorney before accepting the Award. You may consider whether you wish to accept the Award for up to 30 days from the date it was first made available to you on the Website. By accepting the Award, you acknowledge and agree that it is fair and adequate consideration for the covenant not to compete and other promises you make in this Countries Addendum A. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Confidentiality. (a) You acknowledge that you have access to Confidential Information which is not generally known or made available to the general public and that such Confidential Information is the property of the Company, its Subsidiaries or its or their licensors, suppliers or customers. Subject to Paragraph 17, below, you agree specifically as follows, in each case whether during your Employment or following the termination thereof: (i) You will always preserve as confidential all Confidential Information, and will never use it for your own benefit or for the benefit of others; this includes that you will not use the knowledge of activities or positions in clients’ securities portfolio accounts or cash accounts for your own personal gain or for the gain of others. (ii) You will not disclose, divulge, or communicate Confidential Information to any unauthorized person, business or corporation during or after the termination of your Employment with the Company and its Subsidiaries. You will use your best efforts and exercise due diligence to protect, to not disclose and to keep as confidential all Confidential Information. (iii) You will not initiate or facilitate any unauthorized attempts to intercept data in transmission or attempt entry into data systems or files. You will not intentionally affect the integrity of any data or systems of the Company or any of its Subsidiaries through the introduction of unauthorized code or data, or through unauthorized deletion or addition. You will abide by all applicable Corporate Information Security procedures. (iv) Upon the earlier of request or termination of Employment, you agree to return to the Company or the relevant Subsidiaries, or if so directed by the Company or the relevant Subsidiaries, destroy any and all copies of materials in your possession containing Confidential Information. (b) The terms of this Countries Addendum A do not apply to any information which is previously known to you without an obligation of confidence or without breach of this Countries Addendum A, is publicly disclosed (other than by a violation by you of the terms of this Countries Addendum A) either prior to or subsequent to your receipt of such information, or is rightfully received by you from a third party without obligation of confidence and other than in relation to your Employment with the Company or any of its Subsidiaries. 20

 
State Street recognizes that certain disclosures of confidential information to appropriate government authorities or other designated persons are protected by “whistleblower” and other laws. Nothing in this Countries Addendum A is intended to or should be understood or construed to prohibit or otherwise discourage such disclosures. State Street will not tolerate any discipline or other retaliation against employees who properly make such legally-protected disclosures. 2. Assignment and Disclosure. (a) You acknowledge that, by reason of being employed by your Employer, to the extent permitted by law, all works, deliverables, products, methodologies and other work product conceived, created and/or reduced to practice by you, individually or jointly with others, during the period of your Employment by your Employer and relating to the Company or any of its Subsidiaries or demonstrably anticipated business, products, activities, research or development of the Company or any of its Subsidiaries or resulting from any work performed by you for the Company or any of its Subsidiaries, including, without limitation, any track record with which you may be associated as an investment manager or fund manager (collectively, “Work Product”), that consists of copyrightable subject matter is "work made for hire" as defined in the Copyright Act of 1976 (17 U.S.C. § 101), and such copyrights are therefore owned, upon creation, exclusively by State Street. To the extent the foregoing does not apply and to the extent permitted by law, you hereby assign and agree to assign, for no additional consideration, all of your rights, title and interest in any Work Product and any intellectual property rights therein to State Street. You hereby waive in favor of State Street any and all artist’s or moral rights (including without limitation, all rights of integrity and attribution) you may have pursuant to any state, federal or foreign laws, rules or regulations in respect of any Work Product and all similar rights thereto. You will not pursue any ownership or other interest in such Work Product, including, without limitation, any intellectual property rights. (b) You will disclose promptly and in writing to the Company or your Employer all Work Product, whether or not patentable or copyrightable. You agree to reasonably cooperate with State Street (i) to transfer to State Street the Work Product and any intellectual property rights therein, (ii) to obtain or perfect such rights, (iii) to execute all papers, at State Street’s expense, that State Street shall deem necessary to apply for and obtain domestic and foreign patents, copyright and other registrations, and (iv) to protect and enforce State Street’s interest in them. (c) These obligations shall continue beyond the period of your Employment with respect to inventions or creations conceived or made by you during the period of your Employment. 3. Non-Solicitation. (a) This Paragraph 3 shall apply to you at any time that you hold the title of Vice President or higher. (b) You agree that, during your Employment and for a period of six (6) months from the date your Employment terminates for any reason you will not, without the prior written consent of the Company or your Employer: 21

 
(i) solicit, directly or indirectly (other than through a general solicitation of employment not specifically directed to employees of the Company or any of its Subsidiaries), the employment of, hire or employ, recruit, or in any way assist another in soliciting or recruiting the employment of, or otherwise induce the termination of the employment of, any person who then or within the preceding twelve (12) months was an officer of the Company or any of its Subsidiaries (excluding any such officer whose employment was involuntarily terminated); or (ii) engage in the Solicitation of Business from any Client on behalf of any person or entity other than the Company or any of its Subsidiaries. (c) Paragraph 3(b)(i) above shall be deemed to exclude the words “hire or employ” if your work location is in California or New York, and shall be construed and administered accordingly. (i) For purposes of this Paragraph 3, “officer” shall include any person holding a position title of Assistant Vice President or SSGA Principal 4 or higher. Notwithstanding the foregoing, this Paragraph 3 shall be inapplicable following a Change in Control. 4. Notice Period Upon Resignation. (a) This Paragraph 4 shall apply to you at any time that you hold the title of Managing Director or higher (or, any time that you hold the title of Vice President or higher in State Street Global Markets (“SSGM”)). If you are subject to an employment agreement that requires a longer notice period, that employment agreement shall govern. (b) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (i) if you are a member of the Management Committee, you will give 180 days’ advance notice; (ii) if you are an Executive Vice President or higher, you will give ninety (90) days’ advance notice; (iii) if you are a Vice President in SSGM, you will give thirty (30) days’ advance notice; and (iv) otherwise, you will give sixty (60) days’ advance notice. (c) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. (d) In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (e) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits (although you may not be eligible for any new incentive compensation awards or, subject to applicable law, 22

 
to accrue any paid vacation time), and shall continue to comply with the applicable policies of your Employer, the Company and its Subsidiaries. (e) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 4, your Employer, the Company or any of its Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for a period equal to the period for which notice of resignation was required but not provided, and for the period of restriction under Paragraph 5, if applicable, in addition to any other remedies available under law. (f) If you have sixty (60) or fewer days’ notice remaining in your required Notice Period under this Paragraph 4, your Employer, or the Company, or any of its Subsidiaries may, at any time during the remainder of your Notice Period, release you from your obligations under this Paragraph 4 and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum A. (g) Notwithstanding the foregoing, if you hold the title of Executive Vice President or higher this Paragraph 4 shall not apply in the event you terminate your Employment for Good Reason on or prior to the first anniversary of a Change in Control (each as defined in the Plan). 5. Non-Competition. (a) This Paragraph 5 shall apply to you at any time that you hold the title of Executive Vice President or higher, except as provided below. You should review it carefully and may, if you wish, consult with an attorney before accepting this Award. (b) During your Employment and for the twelve (12) months following its termination for any reason the “Non-Compete Period”), you will not, anywhere in the Restricted Area, for yourself or any other person or entity, directly or indirectly, in any Restricted Capacity, engage in, provide services to, consult for, or be employed by a business that provides products or services competitive with any products or services of your Employer, the Company or any of its Subsidiaries with respect to which you were involved at any time during your Employment or, with respect to the portion of the Non- Compete Period that follows termination of your Employment, within the two years preceding the date of the termination of your Employment. (c) If you reside in or have a primary reporting location in California, then this Paragraph 5 applies only during your Employment, but has no effect after the termination of your Employment for any reason. (d) If you reside in or are employed in Massachusetts and State Street terminates your employment involuntarily not for cause, then this Paragraph 5 applies only during your Employment, but has no effect after such termination. Here, “cause” means (i) your Employer’s or the Company’s good faith determination that it has a reasonable basis for dissatisfaction with your Employment for reasons such as lack of capacity or diligence, failure to conform to usual standards of conduct, or other culpable or inappropriate behavior or (ii) other grounds for discharge that are reasonably related, in your Employer’s or the Company’s honest judgment, to the needs of the 23

 
business of your Employer, the Company or any of its Subsidiaries. In addition, if you violate a fiduciary duty to your Employer, the Company or any of its Subsidiaries, then the post-employment portion of the Non- Compete Period shall be extended by the time during which you engage in such activities, for up to a total of 2 years following termination of your Employment. (e) “Restricted Area” means anywhere that your Employer, the Company or any of its Subsidiaries markets its products or services (which you acknowledge specifically includes the entire world), or with respect to the portion of the Non-Compete Period that follows termination of your Employment, anywhere in which you provided services or had a material presence or influence on behalf of your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination. (f) “Restricted Capacity” means any capacity, or with respect to the portion of the Non-Compete Period that follows termination of your Employment, any capacity that is the same or similar to the capacity in which you were employed by your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination and/or involves any services that you provided to your Employer, the Company or any of its Subsidiaries at any time within such 2-year period. 6. Definitions – Countries Addendum. For the purpose of this Countries Addendum A, the following terms are defined as follows: (a) “Client” means a prospective, present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve (12) months prior to the date your Employment with your Employer ends. (b) “Confidential Information” includes but is not limited to all trade secrets, trade knowledge, systems, software, code, data documentation, files, formulas, processes, programs, training aids, printed materials, methods, books, records, client files, policies and procedures, client and prospect lists, employee data and other information relating to the operations of the Company or any of its Subsidiaries and to its or any of their customers, and any and all discoveries, inventions or improvements thereof made or conceived by you or others for the Company or any of its Subsidiaries whether or not patented or copyrighted, as well as cash and securities account transactions and position records of clients, regardless of whether such information is stamped “confidential.” (c) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (d) “Solicitation of Business” means the attempt through direct or indirect contact by you or by any other Person with your assistance to induce a Client to: (i) transfer the Client’s business from the Company or any of its Subsidiaries to any other person or entity; 24

 
(ii) cease or curtail the Client’s business with the Company or any of its Subsidiaries; or (iii) divert a business opportunity from the Company or any of its Subsidiaries to any other person or entity, which business or business opportunity concerns or relates to the business with which you were actively connected during your Employment with the Company or any of its Subsidiaries. (e) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 7. Definition – Award Agreement. For the purpose of the Award Agreement, Restrictive Covenant is defined as follows: “Restrictive Covenant” means any confidentiality, non-solicitation, non-competition, non-disparagement, post-employment cooperation or notice provision that you agree to or had agreed to with your Employer, including but not limited to the restrictions contained in the Award Agreement, any employment agreement or offer letter, deferred compensation award agreement of any type, change in control employment agreement or required as a condition to entitlement to payment under any executive supplemental retirement plan. 8. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum A is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. 9. Non-Disparagement. Subject to Paragraph 17, below, you agree that during your Employment and following the termination thereof you shall not make any false, disparaging, or derogatory statements to any media outlet (including Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry groups, financial institutions, or to any current, former or prospective employees, consultants, clients, or customers of the Company or its Subsidiaries regarding the Company, its Subsidiaries or any of their respective directors, officers, employees, agents, or representatives, or about the business affairs or financial condition of the Company or any of its Subsidiaries. 10. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum A are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum A is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such promises in accordance with their specific terms or otherwise breach the promises 25

 
made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled. You further agree that, the periods of restriction contained in this Countries Addendum A shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum A, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. Should the Company determine that any portion of the Deferred Shares granted to you in connection with this Award are to be forfeited on account of your breach of the provisions of this Countries Addendum A, any unvested portion of your Award will cease to vest upon such determination. 11. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum A shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 12. Relationship to Other Agreements. This Addendum A supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 13. Interpretation of Business Protections. The agreements made by you in Paragraphs 1, 2, 3, 4 and 5 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum A is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum A is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 14. Assignment. Except as provided otherwise herein, this Countries Addendum A shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 15. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum A, and it shall be deemed to have been accepted by the Company. You agree that this electronic acceptance by both you and the Company shall be deemed equivalent to the Award having been signed by both parties. 16. Notification Requirement. Until forty-five (45) days after the period of 26

 
restriction under Paragraph 5 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least five (5) business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum A. 17. Certain Limitations. (a) Nothing in this Countries Addendum A prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum A requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any Confidential Information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. You shall not be held criminally or civilly liable under any Federal or State trade secret law if you disclose a Company trade secret (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, solely for the purposes of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * * * Entire Agreement. The Plan and the Agreement constitute the complete understanding and agreement between the parties to the Agreement with respect to this Award, and supersedes and cancels any previous oral or written discussions, agreements or representations regarding this Award or the Common Stock. B. AUSTRALIA ______________________________________________________________________ 1. Award Conditioned on Satisfaction of Regulatory Obligations. If you are (a) a director of a Subsidiary incorporated in Australia, or (b) a person who is a 27

 
management-level executive of a Subsidiary incorporated in Australia and who also is a director of a Subsidiary incorporated outside of Australia, the grant of this Award is conditioned upon satisfaction of the shareholder approval provisions of section 200B of the Corporations Act 2001 (Cth) in Australia. 2. Tax Deferral. This Award is intended to be subject to tax deferral under Subdivision 83A-C of the Income Tax Assessment Act 1997 (subject to the conditions and requirements thereunder). 3. Attached Offer Document. The terms of your Award incorporate the rules of the Plan, the Agreement, this Countries Addendum and the provisions of the attached Offer Document. The Offer Document is hereby incorporated into, and forms an integral and material part of, the Agreement and this Countries Addendum. By accepting your Award, you will be bound by the rules of the Plan, the Agreement, this Countries Addendum and the attached Offer Document. 4. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title of Executive Vice President or higher immediately prior to termination of your Employment, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice in writing; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice in writing. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole 28

 
discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any remaining portion of the Notice Period; provided that such action shall not affect your other obligations under this Addendum. b) Non-Competition. i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co-venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. iii) The period of 12 months referred to in Paragraph 3(b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, 29

 
you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. iv) Nothing in this Paragraph (b) shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. c) Definitions. For the purpose of this Clause 4, the following terms are defined as follows: i) “Client” means a current or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following 30

 
the date of this Award to which this Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. e) Enforcement. You acknowledge and agree that the promises contained in this Clause 3 are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. h) Interpretation of Business Protections. The agreements made by you in Paragraphs 3(a) and 3(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Addendum is severable and independently enforceable without reference to the enforcement of any other provision. Consistent with the Restraint of Trade Act 1976 (NSW), if any restriction set forth in this Clause 3 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. i) Assignment. Except as provided otherwise herein, this Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 31

 
j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Addendum, and it shall be deemed to have been accepted by the Company. k) Notification Requirement. During the period of restriction under Paragraph 3(b) above and for a further 45 days after that period of restriction has expired, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Addendum. l) Certain Limitations i) Nothing in this Addendum prohibits you from reporting possible violations of United States federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of United States federal law or regulation. Moreover, nothing in this Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. C. AUSTRIA ______________________________________________________________________ No country-specific provisions. D. BELGIUM 32

 
______________________________________________________________________ No country-specific provisions. E. BRAZIL ______________________________________________________________________ 1. Compliance with Law. By accepting the Award, you expressly acknowledge and agree to comply with applicable Brazilian laws and to pay any and all applicable taxes associated with the vesting of the Award, the receipt of any dividends, and the sale of shares of Common Stock acquired under the Plan. 2. Labor Law Acknowledgment. You expressly acknowledge and agree that, for all legal purposes, (a) the benefits provided pursuant to the Agreement and the Plan are the result of commercial transactions unrelated to your Employment; (b) the Agreement and the Plan are not a part of the terms and conditions of your Employment; and (c) the income you realize from the Award, if any, is not part of your remuneration from Employment. BY ELECTRONICALLY ACCEPTING THE AGREEMENT AND THIS COUNTRIES ADDENDUM, YOU ACKNOWLEDGE, UNDERSTAND AND AGREE TO THE TERMS AND CONDITIONS OF THE PLAN, YOUR AGREEMENT AND THIS COUNTRIES ADDENDUM. F. CANADA ______________________________________________________________________ 1. Settlement in Shares of Common Stock. Notwithstanding anything to the contrary in the Agreement, this Countries Addendum or the Plan, your Award shall be settled only in shares of Common Stock (and may not be settled in cash). 2. Use of English Language. The following provision will apply if you are a resident of Quebec: You acknowledge and agree that it is your express wish that the Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English. In French: Vous reconnaissez et consentez que c’est votre souhait exprès qui cet accord, de même que tous documents, toutes notifications et tous procédés légaux est entré dans, donné ou instituté conformément ci- 33

 
annexé ou relatant directement ou indirectement ci-annexé, est formulé dans l’anglais. Une version française de cet Accord peut être consultée sur l’intranet. G. CAYMAN ISLANDS ______________________________________________________________________ No country-specific provisions. H. CHINA ______________________________________________________________________ 1. Award Conditioned on Satisfaction of Regulatory Obligations. If you are a national of the Peoples’ Republic of China (“PRC”), this Award is conditioned upon the Company securing all necessary approvals from the PRC State Administration of Foreign Exchange (“SAFE”) to permit the operation of the Plan and the participation of PRC nationals employed by the Company or a Subsidiary, as determined by the Company in its sole discretion. 2. Common Stock Must Remain With Equity Administrator. You agree to hold the shares of Common Stock received upon settlement of this Award with the Equity Administrator until the shares are sold. 3. Exchange Control Restrictions. You understand and agree that, if you are subject to exchange control laws in China, you will be required immediately to repatriate to China the proceeds from the sale of any shares of Common Stock acquired under the Plan. You further understand that such repatriation of proceeds shall be effected through a special bank account established by the Company, and you hereby consent and agree that proceeds from the sale of shares of Common Stock acquired under the Plan may be transferred to such account by the Company on your behalf prior to being delivered to you and that no interest shall be paid with respect to funds held in such account. The proceeds may be paid to you in U.S. dollars or local currency at the Company’s discretion. If the proceeds are paid to you in U.S. dollars, you understand that a U.S. dollar bank account in China must be established and maintained so that the proceeds may be deposited into such account. If the proceeds are paid to you in local currency, you acknowledge that the Company is under no obligation to secure any particular exchange conversion rate and that the Company may face delays in converting the proceeds to local currency due to exchange control restrictions. You agree to bear any currency fluctuation risk between the time the shares of Common Stock are sold and the net proceeds are converted into local currency and distributed to you. You further agree to comply with any other requirements that may be imposed by the Company in the future in order to facilitate compliance with exchange control requirements in China. 34

 
4. Sale of Shares upon Termination of Employment. If you are a PRC national and you cease to be employed by the Company and its Subsidiaries for any reason, you will be required to sell all shares of Common Stock acquired upon vesting of this Award within such time frame as may be required by the SAFE or the Company (in which case, by accepting this Award, you hereby expressly authorize the Company to issue sales instructions on your behalf). You agree to sign any additional agreements, forms and/or consents that reasonably may be requested by the Company (or the Company’s designated brokerage firm) to effectuate the sale of the shares of Common Stock (including, without limitation, as to the transfer of the sale proceeds and other exchange control matters noted above) and shall otherwise cooperate with the Company with respect to such matters. You acknowledge that neither the Company nor the designated brokerage firm is under any obligation to arrange for such sale of shares of Common Stock at any particular price (it being understood that the sale will occur in the market) and that broker’s fees and similar expenses may be incurred in any such sale. In any event, when the shares of Common Stock are sold, the sale proceeds, less any withholding of Tax-Related Items, any broker’s fees or commissions, and any similar expenses of the sale will be remitted to you in accordance with applicable exchange control laws and regulations. 5. Administration. The Company shall not be liable for any costs, fees, lost interest or dividends or other losses you may incur or suffer resulting from the enforcement of the terms of this Countries Addendum or otherwise from the Company’s operation and enforcement of the Plan, the Agreement and this Award in accordance with Chinese law including, without limitation, any applicable SAFE rules, regulations and requirements. I. DENMARK _____________________________________________________________________ _ 1. Danish Stock Option Act. In accepting the Award, you acknowledge and agree that the Award may be subject to additional terms and conditions, to the extent the Danish Stock Option Act applies to the Award. J. FRANCE ______________________________________________________________________ 1. No country-specific provisions. K. GERMANY ______________________________________________________________________ Subsection (a)(ii) of Section 4 General Circumstances of Forfeiture shall not apply to an Award subject to this Agreement. 35

 
L. HONG KONG ______________________________________________________________________ 1. IMPORTANT NOTICE. WARNING: The contents of the Agreement, this Countries Addendum, the Plan, and all other materials pertaining to this Award and/or the Plan have not been reviewed by any regulatory authority in Hong Kong. You are hereby advised to exercise caution in relation to the offer thereunder. If you have any doubts about any of the contents of the aforesaid materials, you should obtain independent professional advice. 2. Nature of the Plan. The Company specifically intends that the Plan will not be treated as an occupational retirement scheme for purposes of the Occupational Retirement Schemes Ordinance (“ORSO”). To the extent any court, tribunal or legal/regulatory body in Hong Kong determines that the Plan constitutes an occupational retirement scheme for the purposes of ORSO, the grant of the Deferred Shares shall be null and void. 3. Settlement in Shares of Common Stock. Notwithstanding Section 2(b) of the Agreement, this Award shall be paid in shares of Common Stock only and does not provide any right for you to receive a cash payment. 4. Award Benefits Are Not Wages. This Award and the shares of Common Stock underlying this Award do not form part of your wages for purposes of calculating any statutory or contractual payments under Hong Kong Law. 5. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. 36

 
(3) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. (iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Section 5 by giving immediate effect to your resignation and making a payment in lieu of any notice due; provided that such action shall not affect your other obligation under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher. (ii) During your Employment and for the 6 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co- venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the 37

 
business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 6 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph (ii) above. (iv) Nothing in this Paragraph 4 shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a present or former customer or client of your Employer, the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which your Employer, the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. (iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 4(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with your Employer, you will reasonably cooperate with your Employer, the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this 38

 
Countries Addendum is appended or following the termination of your Employment). Your Employer, the Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of this Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs 4(a) and 4(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their 39

 
respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by your Employer and the Company. (k) Notification Requirement. Until 45 days after the period of restriction under Paragraph (b) expires, you shall give notice to your Employer of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide your Employer with such other pertinent information concerning such business activity as your Employer or the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. (l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify your Employer or the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney- client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. M. INDIA ____________________________________________________________________ No country-specific provisions. 40

 
N. IRELAND ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. All terms and defined terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (i) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance written notice; and (ii) If you are an Executive Vice President or higher, you will give 90 days’ advance written notice. (iii) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (b) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence otherwise known as “garden leave” and relieve you of some or all of your duties and responsibilities and to cease attending your place of work and/or to cease contact with the Employer’s employees and customers. During any period of garden leave, you will remain subject to the provisions of this agreement and to your obligation of fidelity to your Employer, the Company and its Subsidiaries. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or, subject to applicable law, to accrue any paid vacation time. (c) You agree that should you fail to provide advance written notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its 41

 
Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for a period equal to the period for which notice of resignation was required but not provided, in addition to any other remedies available under law. (d) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph 1, and give immediate effect to your resignation and make a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligation under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher with the Employer and/or the Company or its Subsidiaries. (b) During your Employment and for the six months (such period to be reduced by the duration of the Notice Period as defined in Paragraph 1 above) following its termination for any reason, you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries within the island of Ireland or the United Kingdom, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries and has the meaning assigned to such by section 7 of the Companies Act 2014. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will make 42

 
yourself available and reasonably cooperate with the Company or the relevant Subsidiary or their advisers with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation provided that such expenses are approved in advance by the Company or Employer. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s/legal fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to 43

 
extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations. Nothing in this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other relevant disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. O. ITALY ______________________________________________________________________ No country-specific provisions. P. JAPAN ______________________________________________________________________ No country-specific provisions. Q. JERSEY 44

 
______________________________________________________________________ No country-specific provisions. R. LUXEMBOURG ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title Executive Vice President or higher you are required to give your Employer advance notice of your resignation as per the legal provisions. (b) During the Notice Period, you will cooperate with your employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period. (c) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its Subsidiaries shall be entitled to a compensatory payment in addition to any other remedies available under law. (d) At any time during the Notice Period and upon your request formulated in writing, the Company or your Employer may release you from your obligations under this Section 1, and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher. 45

 
(b) During your Employment you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or they do business, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) For the 12 months after you leave the company, whatever the reason, you will not, directly or indirectly, as a self-employed person whether as owner, co- venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or they do business, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries, this area being in any case limited to the Grand-Duchy of Luxembourg. Specifically, but without limiting the foregoing, you agree not to engage in any manner as a self-employed person in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this 46

 
Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of- pocket and properly documented expenses you incur in connection with such cooperation. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this 47

 
Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations (a) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, and/or privileges applicable to information covered by the bank secrecy (Article 41 of the Law on the financial sector dated April 5, 1993, as amended), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. S. NETHERLANDS ______________________________________________________________________ 1. Waiver of Termination Rights. As a condition to the grant of this Award, you hereby waive any and all rights to compensation or damages as a result of the termination of Employment with the Company and the Subsidiary that employs you in the Netherlands for any reason whatsoever, insofar as those rights result or may result from (a) the loss or diminution in value of such rights or entitlements under the Plan, or (b) your ceasing to have rights under, or ceasing to be entitled to any awards under the Plan as a result of such termination. T. NORWAY 48

 
______________________________________________________________________ No country-specific provisions. U. POLAND ______________________________________________________________________ No country-specific provisions. V. SINGAPORE ______________________________________________________________________ 1. Qualifying Person Exemption. The following provision shall replace Section 17(h) of the Agreement: The grant of the Award under the Plan is being made pursuant to the “Qualifying Person” exemption” under section 273(1)(f) of the Securities and Futures Act (Chapter 289, 2006 Ed.) (“SFA”). The Plan has not been and will not be lodged or registered as a prospectus with the Monetary Authority of Singapore and is not regulated by any financial supervisory authority pursuant to any legislation in Singapore. Accordingly, statutory liability under the SFA in relation to the content of prospectuses shall not apply. You should note that, as a result, the Award is subject to section 257 of the SFA and you will not be able to make (i) any subsequent sale of shares of Common Stock in Singapore or (ii) any offer of such subsequent sale of shares of Common Stock subject to the Award in Singapore, unless such sale or offer is made pursuant to the exemptions under Part XIII Division (1) Subdivision (4) (other than section 280) of the SFA (Chapter 289, 2006 Ed.). W. SOUTH AFRICA ______________________________________________________________________ No country-specific provisions. X. SWITZERLAND ______________________________________________________________________ Securities Law Notice. The offer of the Award is not intended to be publicly offered in Switzerland. Because the offer of the Award is considered a private offering, it is not subject to registration in Switzerland. Neither this document nor any other materials relating to the Award constitutes a prospectus as such term is understood pursuant to article 652a of the Swiss Code of Obligations, and neither this document nor any other 49

 
materials relating to the Award may be publicly distributed nor otherwise made publicly available in Switzerland. Neither this document nor any other offering or marketing material relating to the Award have been or will be filed with, approved or supervised by any Swiss regulatory authority (in particular, the Swiss Financial Market Supervisory Authority (“FINMA”). Y. TAIWAN ______________________________________________________________________ No country-specific provisions. Z. UNITED ARAB EMIRATES ______________________________________________________________________ Securities Law Notice. This document may not be distributed in the Kingdom except to such persons as are permitted under the Rules on the Offer of Securities and Continuing Obligations issued by the Capital Market Authority. The Capital Market Authority does not make any representation as to the accuracy or completeness of this document, and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this document. Prospective recipients of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this document, you should consult an authorized financial adviser. AA. UNITED KINGDOM ______________________________________________________________________ 1. Income Tax and Social Insurance Contribution Withholding. Without limitation to Section 12 of the Agreement, you hereby agree that you are liable for all Tax-Related Items and hereby consent to pay all such Tax-Related Items, as and when requested by the Company and or your Employer (if different) or by HM Revenue & Customs (“HMRC”) (or any other tax authority or any other relevant authority). You also hereby agree to indemnify and keep indemnified the Company and your Employer (if different) against any Tax-Related Items that they are required to pay or withhold on your behalf or have paid or will pay to HMRC (or any other tax authority or any other relevant authority). Notwithstanding the foregoing, if you are a director or executive officer of the Company (within the meaning of Section 13(k) of the Exchange Act), you understand that you may not be able to indemnify the Company for the amount of any income tax not collected from or paid by you within ninety (90) days of the end of the U.K. tax year in which the event giving rise to the Tax-Related Items occurs as it may be considered to be a loan and therefore, it may constitute a benefit to you on which additional income tax and National Insurance contributions (“NICs”) may be payable. You understand that you will be responsible for reporting and paying any income tax due on this additional benefit directly to HMRC under the self-assessment regime and for paying to the Company and/or your Employer (as appropriate) the amount of any NICs 50

 
due on this additional benefit, which may also be recovered from you by any of the means referred to in Section 12 of the Agreement. 2. Exclusion of Claim. You acknowledge and agree that you will have no entitlement to compensation or damages insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Deferred Shares, whether or not as a result of such termination, (whether such termination is in breach of contract or otherwise), or from the loss or diminution in value of the Deferred Shares. Upon the grant of your Award, you shall be deemed irrevocably to have waived any such entitlement. 3. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its 51

 
Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. (iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligations under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. (ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co- venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 12 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. (iv) Nothing in this Paragraph (b) shall prevent your ownership for investment purposes only of shares or other securities of two percent (2%) or less of the total issued capital of any company whether or not its securities are publicly traded. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have 52

 
supervised have had, substantive and recurring personal contact during the Relevant Period. (ii) “Products or Services” means any products or services which are of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. (iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of- pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to 53

 
recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs (a) and (b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. (k) Notification Requirement. Until 45 days after the period of restriction under this Paragraph 3 (b) expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 54

 
(l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney- client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * 55

 
OFFER DOCUMENT STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN OFFER OF DEFERRED STOCK TO AUSTRALIAN RESIDENT EMPLOYEES GRANT DATE: [_____________________] INVESTMENT IN SHARES INVOLVES A DEGREE OF RISK. EMPLOYEES WHO ELECT TO PARTICIPATE IN THE PLAN SHOULD MONITOR THEIR PARTICIPATION AND CONSIDER ALL RISK FACTORS RELEVANT TO THE PURCHASE OF COMMON STOCK UNDER THE PLAN AS SET OUT IN THIS OFFER DOCUMENT AND THE ADDITIONAL DOCUMENTS. ANY ADVICE CONTAINED IN THIS OFFER DOCUMENT IN RELATION TO THE DEFERRED STOCK BEING OFFERED UNDER THE PLAN DOES NOT TAKE INTO ACCOUNT THE OBJECTIVES, FINANCIAL SITUATION AND NEEDS OF ANY INDIVIDUAL EMPLOYEE. EMPLOYEES SHOULD CONSIDER OBTAINING THEIR OWN FINANCIAL PRODUCT ADVICE FROM AN INDEPENDENT PERSON LICENSED BY THE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION TO GIVE ADVICE ABOUT PARTICIPATING IN THE PLAN. 56

 
OFFER OF DEFERRED STOCK TO AUSTRALIAN RESIDENT EMPLOYEES STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN We are pleased to provide you with this offer to participate in the State Street Corporation 2017 Stock Incentive Plan (and any sub-plan established thereunder) (U.S. Plan) as supplemented for implementation in Australia by the Australian Addendum to the State Street Corporation 2017 Stock Incentive Plan (Australian Addendum). The U.S. Plan as supplemented by the Australian Addendum is hereinafter referenced as the “Plan.” This Offer Document sets out information about grants of Deferred Stock (referenced as “Restricted Common Stock Units” in the U.S. Plan) (Awards) under the Plan and the Deferred Stock Award Agreement (Agreement) to Australian resident employees of subsidiaries of State Street Corporation (Company). The purpose of the U.S. Plan is to advance the interests of the Company by providing for the grant of Common Stock-based Awards. Terms defined in the U.S. Plan and the Australian Addendum have the same meaning in this Offer Document. 1. OFFER This is an Offer of Deferred Stock, as may be granted from time to time in accordance with the Plan by the Company to selected eligible employees of Australian Affiliates. The grant of Deferred Stock under the Plan is intended to comply with the provisions of the Australian Corporations Act 2001 (Cth) (Corporations Act 2001), Australian Securities and Investment Commission (ASIC) Regulatory Guide 49 and ASIC Class Order 14/1000. 2. TERMS OF GRANT The terms of your Award incorporate the rules of the Plan, this Offer Document and your Agreement. By accepting your Award, you will be bound by the rules of this Offer Document, the Plan and your Agreement. 3. ADDITIONAL DOCUMENTS In addition to the information set out in this Offer Document, the following attached documents provide further information necessary to make an informed decision about participating in the Plan: (a) The U.S. Plan and related U.S. prospectus; (b) the Agreement and the Countries Addendum; (c) the Australian Addendum; and (d) the Employee Information Supplement. 57

 
(collectively Additional Documents). The U.S. Plan document sets out, among other details, the nature of your Award and the consequences of a change in the nature or status of your Employment. To the extent of any inconsistency between (a) this Offer Document or the Australian Addendum and (b) any Additional Document (other than the Offer Document and Australian Addendum), the terms of the Offer Document (and Australian Addendum) will apply. 4. RELIANCE ON STATEMENTS You should not rely upon any oral statements made to you in relation to this Offer. You should only rely upon the statements contained in this Offer Document and the Additional Documents when considering your participation in the Plan. 5. WHO IS ELIGIBLE TO PARTICIPATE You are eligible to participate in the Plan if, at the time of the offer, you are an Australian resident employee, officer, consultant, advisor or non-employee Director of the Company or an Australian subsidiary and meet the eligibility requirements established under the Plan. 6. ACCEPTING AN AWARD Your Agreement sets out the key details of your Award. To accept your grant you must expressly accept the Award within the period set out in your Agreement, and in any case no more than thirty (30) days from the date on which the Board made the determination to grant the Award. 7. WHAT ARE THE MATERIAL TERMS OF AN AWARD? (a) What is Deferred Stock? A Deferred Stock Award represents the right to receive shares of Common Stock of the Company on fulfilment of the time-based vesting conditions set out in your Agreement. When your Deferred Stock vests, you will be issued shares of the Company’s Common Stock at no monetary cost to you. The Deferred Stock is considered “restricted” because it will be subject to forfeiture and restrictions on transfer until it vests. The restrictions will be set forth in the attached Agreement. (b) Do I have to pay any money to receive the Deferred Stock Award? No. You do not pay any monetary consideration to receive this Award, and you do not pay any monetary consideration to receive the shares of Common Stock subject to your Award upon vesting. (c) How many shares of Common Stock will I receive upon vesting of my Deferred Stock Award? Your Agreement will indicate the number of shares of Common Stock subject to your Award. (d) When do I become a Stockholder? 58

 
You are not a stockholder merely as a result of holding an Award, and your Award does not entitle you to vote or receive dividends, notices of meeting, proxy statements or other materials provided to stockholders until the shares of Common Stock are issued to you upon vesting. You should also refer to your Agreement for details of the consequences of a change in the nature of your Employment. (e) Can I transfer my Award to someone else? No. However, once shares of Common Stock are issued to you upon vesting, the shares will be freely tradeable and transferable. Please note, though, the possible disclosure obligations included under clause 9. 8. WHAT IS A SHARE OF STOCK IN THE COMPANY? Common stock of a U.S. corporation is analogous to ordinary shares of an Australian company. Each holder of Common Stock is entitled to one vote for every share of Common Stock held in the Company. Dividends may be paid on the shares of Common Stock out of any funds of the Company legally available for dividends at the discretion of the Board of Directors of the Company. The shares of Common Stock are traded on the New York Common Stock Exchange and are traded under the symbol STT. Shares of Common Stock are not liable to any further calls for payment of capital or for other assessment by the Company and have no sinking fund provisions, pre-emptive rights, conversion rights or redemption provisions. 9. HOW CAN I OBTAIN UPDATED INDICATIVE EXAMPLES OF THE CURRENT MARKET PRICE IN AUSTRALIAN DOLLARS? Within a reasonable period following your request, the Company undertakes to provide you with the Australian dollar equivalent of the current market price of a share of Common Stock, (calculated as at the date of your request). The current market price for this purpose will be the final sale price of a share of Common Stock on the New York Common Stock Exchange on the trading day immediately preceding the date of your request. The Australian dollar equivalent of these prices will be calculated using the Australian/U.S. dollar exchange rate published by an Australian bank on the business day immediately preceding the date of your request. Please note that the Australian dollar equivalent of these prices is only provided as information and not as a prediction of the Australian dollar equivalent of the fair market value of a share of Common Stock at the time of vesting. The Australian dollar equivalent at these times will depend on the exchange rate applied by your bank in converting your Australian dollars to U.S. Dollars at the time of vesting. The exchange rate is available at: http://www.rba.gov.au/statistics/frequency/exchange-rates.html 59

 
You should direct your request to: Name: John T. Sheehan Title: Compensation Consultant, Global Benefits & Equity Australian Affiliate means State Street Australia Limited; State Street Global Advisors Australia; State Street Bank and Trust Company – Sydney Branch and any other Associated Body Corporate employing Employees in Australia. Address: State Street Financial Center, 1 Lincoln Street, Boston, MA 02116, USA Phone: +1 617-664-5455 Email: jtsheehan@statestreet.com 10. WHAT ADDITIONAL RISK FACTORS APPLY TO AUSTRALIAN RESIDENTS' PARTICIPATION IN THE PLAN? Employees should consider generally the risk factors connected with investing in securities and, in particular, to holding shares of Common Stock. You should be aware that the fair market value of shares of Common Stock underlying your Award and the future value of shares of Common Stock you acquire and the Australian dollar equivalent of these values will be affected by: (a) fluctuations in the Company's performance; (b) fluctuations in the U.S.$/A$ exchange rate; (c) factors identified from time to time by the Company's filings with the U.S. Securities and Exchange Commission; (d) fluctuations in the domestic and international market for listed stocks (e) general economic conditions including interest rates, inflation rates, commodity and oil prices; (f) changes to governmental fiscal, monetary and regulatory policies; (g) legislation or regulation; (h) the nature of the markets in which the Company operates; and (i) general operational business risks. Please note that if you offer your shares of Common Stock for sale to a person or entity resident in Australia, your offer may be subject to disclosure requirements under Australian law. Please obtain legal advice on your disclosure obligations before you make any such offer. 60

 
11. PLAN MODIFICATION, TERMINATION, ETC. Subject to Section 9 of the U.S. Plan, the Board may amend, alter, suspend, discontinue or terminate the Plan or any part of it at any time. 12. WHAT ARE THE AUSTRALIAN TAXATION CONSEQUENCES OF PARTICIPATION IN THE PLAN? Please see the Additional Document entitled "Employee Information Supplement – Deferred Stock Awards" for information regarding the Australian tax treatment of your Award. 13. WHAT ARE THE U.S. TAXATION CONSEQUENCES OF PARTICIPATION IN THE PLAN? Employees (who are not U.S. citizens or permanent residents) will not be subject to U.S. tax by reason only of the grant and vesting of the Deferred Stock or the sale of shares of Common Stock, except as described in the dividends section of the “Employee Information Supplement - Deferred Stock”. However, liability for U.S. taxes may accrue if an employee is otherwise subject to U.S. taxes. The above is an indication only of the likely U.S. taxation consequences for Australian resident employees receiving Awards under the Plan. Award recipients should seek their own advice as to the U.S. taxation consequences of Plan participation. 14. RESTRICTION ON CAPITAL RAISING 5% LIMIT In addition to any other limitations as identified in this Offer Document, the Plan or as prescribed by the Board from time to time under the terms of the Plan, there is an overall restriction on the number of shares of Common Stock that can be issued to Australian employees. * * * * * We urge you to carefully review the information contained in this Offer Document and the Additional Documents. If you have any questions, please contact the person listed in Section 9. Yours sincerely, State Street Corporation 61

 
STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN [____] Deferred Stock Award Agreement Subject to your acceptance of the terms set forth in this agreement and the addendum attached hereto (“Agreement”), State Street Corporation (“Company”) has awarded you, under the State Street Corporation 2017 Stock Incentive Plan (“Plan”), and pursuant to this Agreement and the terms set forth herein, a contingent right to receive the number of shares of Common Stock (“Deferred Shares”) (“Award”) as set forth in the statement pertaining to this Award (“Statement”) on the website (“Website”) maintained by Fidelity Stock Plan Services LLC, an independent service provider based in the United States, or another party designated by the Company (“Equity Administrator”). Copies of the Plan, the Company’s Prospectus for the Plan and any employee information supplement to the Prospectus for your country of Employment (“Tax Supplement”) are located on the Website for your reference. Your acceptance of this Award constitutes your acknowledgement that you have read and understood this Agreement, the Plan, the Prospectus for the Plan and the Tax Supplement. The provisions of the Plan are incorporated herein by reference, and all terms used herein shall have the meaning given to them in the Plan, except as otherwise expressly provided herein. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of the Plan shall control. As used herein, “State Street” means the Company and each Subsidiary. “Subsidiary” means the Company’s consolidated subsidiaries. You may consider this Agreement for up to thirty (30) days from the date it was first made available to you on the Website. The terms of your Award are as follows: 1. Grant of Deferred Shares. To be entitled to any payment under this Award, you must accept your Award and in so doing agree to comply with the terms and conditions of this Agreement and the applicable provisions of the Countries Addendum outlined in Appendix A (which is incorporated into, and forms a material and integral part of, this Agreement). Failure to accept this Award within thirty (30) days following the posting of this Agreement on the Website will result in forfeiture of this Award. Subject to the terms and conditions of this Agreement, Deferred Shares shall vest and be settled in the form of shares of Common Stock according to the vesting schedule set forth in your Statement. The term “vest” as used herein means the lapsing of certain (but not all) restrictions described herein and in the Plan with respect to one or more Deferred Shares as of each applicable vesting date. To vest in all or any portion of this Award as of any date, you must have been continuously employed with the Company or a Subsidiary, from and after the date hereof and until (and including) the applicable vesting date, except as otherwise provided herein. By accepting this Award, you acknowledge and agree that with respect to any claim you may undertake to raise in the future with respect to this Award, of Deferred Shares or Common Stock issued by the Company with respect to this Agreement may only be 1

 
raised against the Company in a court of competent jurisdiction in the Commonwealth of Massachusetts, regardless of where or whether you are employed by the Company or a Subsidiary. This Award is subject to any forfeiture, compensation recovery or similar requirements set forth in this Agreement, as well as any other forfeiture, compensation recovery or similar requirements under applicable law and related implementing regulations and guidance, and to other forfeiture, compensation recovery or similar requirements under plans, policies and practices of the Company or its relevant Subsidiaries in effect from time to time, including those set forth in your offer letter. In the event pursuant to this Agreement or pursuant to any applicable law or related implementing regulations or guidance, or pursuant to any Company or its relevant Subsidiaries plans, policies or practices, the Board or State Street is required or permitted to reduce, forfeit or cancel any amount remaining to be paid, or to recover any amount previously paid, with respect to this Award, or to otherwise impose or apply restrictions on this Award or shares of Common Stock subject hereto, it shall, in its sole discretion, be authorized to do so. By accepting this Award, you consent to making payment to the Subsidiary that legally employs you (“Employer”) in the event of a compensation recovery determination by the Board or State Street. 2. Payment of Common Stock. (a) The Company will issue and transfer to you, no later than thirty (30) days following the applicable vesting dates, the number of shares of Common Stock specified in the vesting schedule in your Statement. The Company’s obligation to issue and transfer Common Stock in the future pursuant to this Agreement is an unsecured and unfunded contractual obligation. (b) Notwithstanding the foregoing, the Company may, in its sole discretion, settle any vested Deferred Shares in the form of: (i) a cash payment to the extent settlement in shares of Common Stock (1) is prohibited under local law, rules or regulations, (2) would require you, the Company or your Employer to obtain the approval of any governmental and/or regulatory body in your country of residence (or country of Employment, if different), or (3) is administratively burdensome; or (ii) shares of Common Stock, but require you to immediately sell such shares of Common Stock (in which case, you hereby expressly authorize the Company to issue sales instructions on your behalf). 3. Identified Staff Holding Requirement. Notwithstanding anything herein to the contrary, you agree and covenant that, as a condition to the receipt of this Award and the settlement of the Deferred Shares in the form of shares of Common Stock hereunder, in the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated Identified Staff for purposes of the Capital Requirements Directive IV (or any implementing or successor rule, regulation or guidance, including the rules and regulations of the United Kingdom Financial Conduct Authority (“FCA”), Prudential Regulation Authority (“PRA”), German Federal Financial Supervisory Authority (“BaFin”) or any other applicable regulatory authority), you will not sell or otherwise transfer any 2

 
shares of Common Stock issued and transferred to you pursuant to this Award until the date that is at least twelve (12) months for UK and State Street Bank International GmbH (“SSB Intl GmbH”) Identified Staff (or such longer period as is stipulated by the FCA, the PRA, BaFin or any other applicable regulatory authority) after the vesting date of Deferred Shares paid in connection with this Award, except that (a) you shall be permitted to sell, upon such vesting date, a number of shares of Common Stock sufficient to pay applicable tax and social security withholding, if any, with respect to such vesting (or, alternatively, if the Company withholds such shares pursuant to Section 11 of this Agreement, the requirements in this Section 3 not to sell or otherwise transfer any shares shall only apply to the number of such shares delivered to you (i.e., after such withholding of shares)), (b) transfers by will or pursuant to the laws of descent or distribution are permitted and (c) this holding requirement shall not apply to such portion of the Deferred Shares, if any, that were awarded with respect to a period of time, as determined by the Company in its discretion, during which you were not subject to such holding requirement. Any attempt by you (or in the case of your death, by your Designated Beneficiary) to assign or transfer shares of Common Stock subject to this Award, either voluntarily or involuntarily, contrary to the provisions hereof, shall be null and void and without effect. The Company may, in its sole discretion, impose restrictions on the assignment or transfer of shares of Common Stock consistent with the provisions hereof, including, without limitation, by or through the transfer agent for such shares or by means of legending Common Stock certificates or otherwise. This provision applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 4. General Circumstances of Forfeiture. (a) You will immediately forfeit any and all rights to receive shares of Common Stock under this Agreement not previously vested, issued and transferred to you in the event: (i) you cease to be employed by the Company and its Subsidiaries due to Circumstances of Forfeiture; (ii) your Employer, in its sole discretion, determines that circumstances prior to the date on which you ceased to be employed by the Company and its Subsidiaries for any reason constituted grounds for an involuntary termination constituting Circumstances of Forfeiture; or (iii) you fail to comply with the terms of the applicable Countries Addendum attached to this Award or the terms of any other Restrictive Covenant (as defined in the Countries Addendum) you agree to or have agreed to with the Company or your Employer. (b) If your Employment terminates by reason of [Retirement or] Disability or for reasons other than for Circumstances of Forfeiture, then unless accelerated as 3

 
provided in Section 9, your unvested right to receive shares of Common Stock hereunder shall continue to vest in accordance with the vesting schedule detailed in your Statement, subject to the terms and conditions of this Agreement. (c) For purposes hereof: (i) “Circumstances of Forfeiture” means the termination of your Employment with the Company and its Subsidiaries either (A) voluntarily (other than [(x) Retirement or (y)] for Good Reason on or prior to the first anniversary of a Change in Control) or (B) involuntarily for reasons determined by the Company or the relevant Subsidiary in its sole discretion to constitute “gross misconduct” [(including while you are Retirement eligible)]. (ii) [“Retirement” means your attainment of age 55 and completion of 5 years of continuous service with the Company and its Subsidiaries. (iii) ]“Disability” means your inability to engage in any substantially gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in your death or can be expected to last for a continuous period of not less than 12 months. (d) If you are a local national of and employed in a country that is a member of the European Union (“EU”), the grant of this Award and the terms and conditions governing this Award are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent a court or tribunal of competent jurisdiction determines that any provision of this Award is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under applicable local law. (e) This Section 4 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 5. Material Risk Taker Malus-Based Forfeiture. In the event you hold a title of Senior Vice President or higher during the calendar year in which this Award is made, or you hold the status of “material risk taker” at the time this Award is made or any time thereafter, you acknowledge and agree that this Award is subject to the provisions of this Section 5. In respect of any Award remaining to be issued and transferred to you in Common Stock or otherwise paid may, in the sole discretion of the Board, be reduced, forfeited or cancelled, in the event that it is determined by the Board, in its sole discretion, that your actions, whether discovered during or after your employment with the Employer, exposed The Business to any inappropriate risk or risks (including where you failed to timely identify, analyze, assess or raise concerns about such risk or risks, including in a supervisory capacity, where it was reasonable to expect you to do so), and such exposure has resulted or could reasonably be expected to result in a material loss or losses that are or would be substantial in relation to the revenues, capital and overall risk tolerance of The Business. “The Business” shall mean State Street, or, to the extent you devote substantially all of your business time to a particular business unit (e.g., Global Services Americas, Global Services International, State Street Global Exchange or State Street Sector Solutions) 4

 
or business division (e.g., Alternative Investment Solutions, Securities Lending), “Business” shall refer to such business unit or business line. This provision applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 6. Identified Staff Malus-Based Forfeiture and Clawback. (a) In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated Identified Staff for purposes of the PRA Remuneration Code, you acknowledge and agree that this Award is subject to the provisions of this Section 6 for a period of seven (7) years from the date this Award is granted. The seven (7)-year period may be extended to ten (10) years in certain circumstances where: (i) the Company has commenced an investigation into facts or events which it considers could potentially lead to the application of a clawback under this Section 6 were it not for the expiration of the seven (7)-year period; or (ii) the Company has been notified by a regulatory authority that an investigation has commenced into facts or events which the Company considers could potentially lead to the application of clawback by the Company under this Section 6 were it not for the expiration of the seven (7)-year period. (b) If the Company determines that a PRA Forfeiture Event has occurred it may elect to reduce, forfeit or cancel all or part of any amount remaining to be issued and transferred to you in Common Stock or otherwise paid in respect of this Award (“PRA Malus-Based Forfeiture”). (c) If the Company determines that a PRA Clawback Event has occurred it may require the repayment by you (or otherwise seek to recover from you) of all or part of any compensation paid to you in respect of this Award. (d) The Company may produce guidelines from time to time in respect of its operation of the provisions of this Section 6. The Company intends to apply such guidelines in deciding whether and when to effect any reduction, cancellation, forfeiture or recovery of compensation but, in the event of any inconsistency between the provisions of this Section 6 and any such guidelines, this Section 6 shall prevail. Such guidelines do not form part of any employee’s contract of Employment, and the Company may amend such guidelines and their application at any time. (e) By accepting this Award on the Website, you expressly and explicitly: (i) consent to making the required payment to the Company (or to your Employer on behalf of the Company) upon a PRA Clawback Event; and (ii) authorize the Company to issue related instructions, on your behalf, to the Equity Administrator and any brokerage firm and/or third party administrator engaged by the Company to hold your shares of Common Stock and other amounts acquired under the Plan and to re-convey, transfer or otherwise return such shares of Common Stock and/or other amounts to the Company. (f) For the purposes of this Section 6: 5

 
(i) A “PRA Forfeiture Event” means a determination by the Company, in its sole discretion, that (A) there is reasonable evidence of your misbehavior or material error; or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material downturn in its financial performance; or (C) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management. (ii) A “PRA Clawback Event” means a determination by the Company, in its sole discretion, that either (A) there is reasonable evidence of your misbehavior or material error or (B) the Company, one of its Subsidiaries or a relevant business unit has suffered a material failure of risk management. (g) This Section 6 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 7. SSB Intl GmbH and SSGA GmbH Affordability Limitations, and Malus- Based Forfeiture and Clawback. (a) Awards issued to SSB Intl GmbH or State Street Global Advisors GmbH staff may be impacted by the financial situation of the bank and/or regulatory group, as prescribed by regulatory requirements in its applicable version (e.g. the Remuneration Ordinance for Institutions and/or German Banking Act). Awards may also be limited to the extent ordered by the competent supervisory authority according to sec. 45 para. 2 sentence 1 no. 5a, 6 German Banking Act. Further, entitlement to an Award may lapse if the competent supervisory authority issues a corresponding definitive order according to sec. 45 para. 5 sentence 5 to 8 German Banking Act. (b) In the event the Company or any Subsidiary notifies you at any time before or after this Award is made that you have been designated SSB Intl GmbH Identified Staff for purposes of the German Remuneration Ordinance, you acknowledge and agree that this Award is subject to forfeiture and clawback for a period from the date the Award is granted until two (2) years from the date that the final tranche of this Award vests. A clawback applies if you, as SSB Intl GmbH Identified Staff, (i) contributed significantly to, or was responsible for, conduct that resulted in significant losses or regulatory sanctions for SSB Intl GmbH, or (ii) is responsible for a serious breach of relevant external or internal rules on good conduct (“SSB Intl GmbH Identified Staff Clawback Event”). (c) Section 7 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 8. Management Committee/Executive Vice President Forfeiture and Clawback. (a) If, at the time the Award is made, you are a member of the State Street Corporation Management Committee or any successor committee or body (“Management Committee” or “MC”) or hold the title Executive Vice President (“EVP”) or higher, any amount remaining to be paid in respect of this Award may, in the sole 6

 
discretion of the Board, be reduced, forfeited or cancelled, in whole or in part, in the event that it is determined by the Board, in its sole discretion, that: (i) you engaged in fraud, gross negligence or any misconduct, including in a supervisory capacity, that was materially detrimental to the interests or business reputation of State Street or any of its businesses; or (ii) you engaged in conduct that constituted a violation of State Street policies and procedures or State Street Standard of Conduct in a manner which either caused or could have caused reputational harm that is material to State Street or placed or could have placed State Street at material legal or financial risk; or (iii) as a result of a material financial restatement by State Street contained in a filing with the U.S. Securities and Exchange Commission (“SEC”), or miscalculation or inaccuracy in the determination of performance metrics, financial results or other criteria used in determining the amount of this Award, you would have received a smaller or no Award hereunder. (b) If, at the time the Award is made, you are a member of the Management Committee or hold the title EVP or higher, this Award also is subject to compensation recovery as provided herein. Upon the occurrence of an MC/EVP Clawback Event within three (3) years (within one (1) year for an EVP) after the date of grant of this Award, the Board may, in its sole discretion, determine to recover the MC/EVP Clawback Amount, in whole or in part. Following such a determination, you agree to immediately repay such compensation, in no event later than sixty (60) days following such determination, in the form of any shares of Common Stock delivered to you previously by the Company or cash (or a combination of such shares and cash). For purposes of calculating the value of both: (i) the amount of the MC/EVP Clawback Amount determined by the Board to be recovered; and (ii) the amount of such compensation repaid, shares of Common Stock will be valued in an amount equal to the market value of the Deferred Shares delivered to you under this Award by the Company as determined at the time of such delivery. To the extent not prohibited by applicable law and subject to Section 15 (if applicable), if you fail to comply with any requirement to repay compensation under this Section 8(b), the Board may determine, in its sole discretion, in addition to any other remedies available to the Company, that you will satisfy your repayment obligation through an offset to any future payments owed by the Company or any of its Subsidiaries to you. (c) For purposes of this Section 8: (i) “MC/EVP Clawback Event” means a determination by the Board, in its sole discretion, (A) with respect to any event or series of related events, that you engaged in fraud or willful misconduct, including in a supervisory capacity, that resulted in financial or reputational harm that is material to State Street and resulted in the termination of your Employment by the Company and its Subsidiaries (or, following a cessation of your Employment for any other reason, such circumstances constituting grounds for termination are determined applicable) or (B) a material financial restatement or miscalculation or inaccuracy in financial results, performance metrics, or other criteria used in determining this Award by State Street occurred. For the avoidance of doubt and as applicable, 7

 
an MC/EVP Clawback Event includes any determination by the Board that is based on circumstances prior to the date on which you cease to be employed by the Company and its Subsidiaries for any reason, even if the determination by the Board occurs after such cessation of Employment. (ii) “MC/EVP Clawback Amount” means (A) with respect to an MC/EVP Clawback Event described in Section 8(c)(i)(A), the value of the Deferred Shares, determined under Section 8(b) above, that were delivered to you under this Award by the Company during the period of three (3) years (one (1) year for an EVP) immediately prior to such MC/EVP Clawback Event or (B) with respect to an MC/EVP Clawback Event described in Section 8(c)(i)(B), the value of the Deferred Shares, determined under Section 8(b) above, that were delivered to you under this Award by the Company (x) during the period of three (3) years (one (1) year for an EVP) immediately prior to an associated date designated by the Board and (y) that represents an amount that, in the sole discretion of the Board, exceeds the amount you would have been awarded under this Award had the financial statements or other applicable records of State Street been accurate (reduced, in the case of both of the immediately preceding clauses (A) and (B), taking into account any portion of this Award that was previously recovered by the Company under Section 8(b) to avoid a greater than 100% recovery). (d) In connection with any MC/EVP Clawback Event, you hereby expressly and explicitly authorize the Company to issue instructions, on your behalf, to the Equity Administrator and any brokerage firm and/or third party administrator engaged by the Company to hold your shares of Common Stock and other amounts acquired under the Plan to re-convey, transfer or otherwise return such shares of Common Stock and/or other amounts to the Company. (e) This Section 8 applies in addition to, and not to the exclusion of, any other holding, forfeiture and/or clawback provisions contained in this Agreement. 9. Acceleration of Vesting upon Certain Events. (a) Notwithstanding anything in this Agreement to the contrary, if you die while employed by the Company or any of its Subsidiaries, or in the event that you die after your Employment has terminated for a reason permitting continued vesting pursuant to subparagraph 4(b) above, any unvested Deferred Shares shall vest on the date of your death and the Company will issue and pay to your Designated Beneficiary within sixty (60) days of your death the value of such Deferred Shares under this Award in the form of a cash payment/issuance of shares of Common Stock. In addition, Sections 5, 6, 7 and 8 of this Agreement shall cease to apply upon your death at any time provided, however, if a PRA Clawback Event, SSB Intl GmbH Identified Staff Clawback Event or an MC/EVP Clawback Event has occurred pursuant to Section 6, 7 or 8, respectively, at or prior to your death, any amount that the Board has made a determination to recover under either such Sections shall continue to be payable to the Company. (b) Subject to applicable law and regulation (including the rules and regulations of any applicable regulatory authority), if your Employment with the Company and its Subsidiaries is terminated by the Company or the applicable Subsidiary without Cause, [or] by you for Good Reason [or on account of your Retirement], in each case, on 8

 
or prior to the first anniversary of a Change in Control (and provided that such Change in Control constitutes a “change in control event” as that term is defined under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, (“Code”) and U.S. Treasury Regulation Section 1.409A-3(i)(5)) prior to the full settlement of your Award, the unvested portion of this Award shall vest on the date of such termination and the Company will promptly issue and pay to you within thirty (30) days of such termination any such shares of Common Stock under this Award. For purposes of this Section 9(b), termination of Employment shall mean a “separation from service” as determined in accordance with U.S. Treasury Regulation Section 1.409A-1(h). 10. Shareholder Rights. You are not entitled to any rights as a shareholder with respect to any shares of Common Stock subject to this Award until they are transferred to you. Without limiting the foregoing, prior to the issuance and transfer to you of shares of Common Stock pursuant to this Agreement, you will have no right to receive dividends or amounts in lieu of dividends with respect to the shares of Common Stock subject to this Award nor any right to vote the shares of Common Stock prior to any shares being transferred to you. 11. Withholding of Tax-Related Items. Regardless of any action your Employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account of other tax-related withholding (“Tax-Related Items”), you acknowledge and agree that the ultimate liability for all Tax-Related Items legally due from you is and remains your responsibility. Furthermore, neither the Company nor your Employer (a) makes any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this Award, including the grant of this Award, the vesting of this Award and the issuance of shares of Common Stock in settlement of this Award, the subsequent sale of any shares of Common Stock acquired upon vesting, the cancellation, forfeiture or repayment of any shares of Common Stock (or cash in lieu thereof); or (b) commits to structure the terms of the grant, vesting, settlement, cancellation, forfeiture, repayment or any other aspect of this Award to reduce or eliminate your liability for Tax-Related Items. Prior to the delivery of shares of Common Stock upon the vesting of this Award, if any taxing jurisdiction requires withholding of Tax-Related Items in connection with the Award, the Company may withhold a sufficient number of whole shares of Common Stock that have an aggregate fair market value sufficient to pay the Tax-Related Items required to be withheld with respect to this Award; provided, however, that the total tax withholding cannot exceed the Employer’s minimum statutory withholding obligations (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income). The cash equivalent of the shares of Common Stock withheld will be used to settle the obligation to withhold the Tax-Related Items (determined in the Company’s reasonable discretion). No fractional shares of Common Stock will be withheld or issued pursuant to the grant of the Deferred Shares and the issuance of Common Stock hereunder. Alternatively, the Company and/or your Employer may, in its discretion, withhold any amount necessary to pay the Tax-Related Items from your salary, wages or other amounts payable to you, with no withholding in shares of Common Stock. In the event the withholding requirements are not satisfied through the withholding of shares or 9

 
through your salary, wages or other amounts payable to you, no shares of Common Stock will be issued upon vesting of this Award unless and until satisfactory arrangements (as determined by the Company or your Employer) have been made by you with respect to the payment of any Tax-Related Items which the Company or your Employer determines, in its sole discretion, must be withheld or collected with respect to such Award. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering any applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. If you are subject to taxation in more than one jurisdiction, you hereby expressly acknowledge that the Company, your Employer or another Subsidiary may be required to withhold and/or account for Tax- Related Items in more than one jurisdiction. By accepting this Award, you hereby expressly consent to the withholding of shares of Common Stock and/or cash as provided for hereunder. All other Tax-Related Items related to this Award and any Common Stock delivered in payment thereof, including the extent to which the Company or your Employer does not so-withhold shares of Common Stock and/or cash, are your sole responsibility. 12. Changes in Capitalization or Corporate Structure. This Award is subject to adjustment pursuant to Section 10(a) of the Plan in the circumstances therein described. 13. Employee Rights. Nothing in this Award shall be construed to guarantee you any right of Employment with the Company, your Employer or any Subsidiary or to limit the discretion of any of them to terminate your Employment at any time, with or without cause to the maximum extent permitted under local law. In consideration of the grant of the Award, you acknowledge and agree that you will have no entitlement to compensation or damages in consequence of the termination of your Employment (for any reason whatsoever and whether or not in breach of contract or local labor laws), insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Award as a result of such termination, or from the loss or diminution in value of the Award. By accepting this Award, you shall be deemed irrevocably to have waived any such claim or entitlement against the Company, your Employer and all Subsidiaries that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by accepting this Agreement, you shall be deemed irrevocably to have waived your entitlement to pursue such claim. In the event your Employment ends and you are subsequently rehired by the Company or any Subsidiary, no Award previously forfeited or recovered will be reinstated. 14. Non-Transferability, Etc. This Award shall not be transferable other than (1) by will or the laws of descent and distribution or (2) pursuant to the terms of a court-approved domestic relations order, official marital settlement agreement or other divorce or settlement instrument 10

 
satisfactory to State Street, in its sole discretion. In the case of transfer pursuant to (2) above, this Award shall remain subject to all the terms and conditions contained in the Plan and this Agreement, including vesting, forfeiture and clawback terms and conditions. Any attempt by you (or in the case of your death, by your Designated Beneficiary) to assign or transfer this Award, either voluntarily or involuntarily, contrary to the provisions hereof, shall be null, void and without effect and shall render this Award itself null and void. 15. Compliance with Section 409A of the Code. (a) The provisions of this Award are intended to be exempt from, or compliant with, Section 409A of the Code, and shall be construed and interpreted consistently therewith. Notwithstanding the foregoing, neither the Company nor any Subsidiary shall have any liability to you or to any other person if this Award is not so exempt or compliant. (b) If and to the extent (i) any portion of any payment, compensation or other benefit provided to you pursuant to the Plan in connection with your Employment termination constitutes “nonqualified deferred compensation” within the meaning of Section 409A of the Code, and (ii) you are a specified employee as defined in Section 409A(a)(2)(B)(i) of the Code, in each case as determined by the Company in accordance with its procedures, by which determinations you (through accepting this Award) agree that you are bound, such portion of the payment, compensation or other benefit shall not be paid before the day that is six months plus one day after the date of “separation from service” (as determined under Section 409A of the Code) (the “New Payment Date”), except as Section 409A of the Code may then permit. The aggregate of any payments that otherwise would have been paid to you during the period between the date of separation from service and the New Payment Date shall be paid to you in a lump sum on such New Payment Date, and any remaining payments will be paid on their original deferral schedule. 16. Miscellaneous. (a) Awards Discretionary. By accepting this Award, you acknowledge and agree that the Plan is discretionary in nature and limited in duration, and may be amended, cancelled, forfeited, or terminated by the Company, in its sole discretion, at any time. The grant of this Award is a one-time benefit and does not create any contractual or other right to receive an award, compensation or benefits in lieu of an award in the future. Future awards, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of an award, the number of shares of Common Stock subject to an award, and forfeiture, clawback and vesting provisions. (b) Company and Committee Discretion. Sections 3, 4, 5, 6, 7 and 8 of this Agreement are intended to comply with and meet the requirements of applicable law and related implementing regulations regarding incentive compensation and will be interpreted and administered accordingly as well as in accordance with any 11

 
implementing policies and practices of the Company or its relevant Subsidiaries in effect from time to time. In making determinations under such Sections, the Company, the relevant Subsidiary or the Board, as applicable, may take into account, in its sole discretion, all factors that it deems appropriate or relevant. Furthermore, the Company, the relevant Subsidiary or the Board may, as applicable, take any and all actions it deems necessary or appropriate in its sole discretion, as permitted by applicable law, to implement the intent of Sections 4, 5, 6, 7 and 8, including suspension of vesting and payment pending an investigation or the determination by the Company, the relevant Subsidiary or the Board as applicable. Each such Section is without prejudice to the provisions of the other Sections, and the Company, the relevant Subsidiary or the Board, as applicable, may elect or be required to apply any or all of the provisions of Sections 3, 4, 5, 6, 7 and 8 to this Award. (c) Voluntary Participation. Your participation in the Plan is voluntary. The value of this Award is an extraordinary item of compensation, is outside the scope of your employment contract, if any, and is not part of your normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments. (d) Electronic Delivery. The Company or any of its Subsidiaries may, in its sole discretion, decide to deliver any documents related to this Award by electronic means. You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system, including the Website, established and maintained by the Company, any of its Subsidiaries, the Equity Administrator or another party designated by the Company. (e) Electronic Acceptance. By accepting this Award electronically, (i) you acknowledge and agree that you are bound by the terms of this Agreement and the Plan and that you and this Award are subject to all of the rights, power and discretion of the Company, its Subsidiaries and the Board set forth in this Agreement and the Plan; and (ii) this Award is deemed accepted by the Company and the Company shall be deemed to be bound by the terms of this Agreement. (f) Language. You acknowledge and agree that it is your express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to this Award, be drawn up in English. If you have received this Agreement, the Plan or any other documents related to this Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will prevail to the extent permitted under local law. France: Une version française de cet Accord peut être consultée sur l’intranet. Poland: Kopię tej Umowy w języku polskim może Pan/Pani otrzymać wchodząc na Stronę. (g) Additional Requirements. The Company reserves the right to impose other requirements on this Award, any shares of Common Stock acquired pursuant to this Award, and your participation in the Plan, to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to 12

 
comply with local laws, rules and regulations, or to facilitate the operation and administration of this Award and the Plan. Such requirements may include (but are not limited to) requiring you to sign any agreements or undertakings that may be necessary to accomplish the foregoing. Further, issuance of Common Stock hereunder is subject to compliance by the Company and you with all legal requirements applicable thereto, including compliance with the requirements of 12 C.F.R. Part 359, and with all applicable regulations of any stock exchange on which the Common Stock may be listed at the time of issuance. (h) Public Offering. If you are a resident and/or employed outside the United States, the grant of this Award is not intended to be a public offering of securities in your country of residence (and country of Employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law), and the grant of this Award is not subject to the supervision of the local securities authorities. (i) Limitation of Liability. No individual acting as a director, officer, employee or agent of the Company or any of its Subsidiaries will be liable to you or any other person for any action, including any Award forfeiture, Award recovery or other discretionary action taken pursuant to this Agreement or any related implementing policy or procedure of the Company. (j) Insider Trading. By participating in the Plan, you agree to comply with the Company’s policy on insider trading (to the extent that it is applicable to you). You further acknowledge that, depending on your country of residence (and country of Employment, if different) or your broker’s country of residence or where the shares of Common Stock are listed, you may be subject to insider trading restrictions and/or market abuse laws which may affect your ability to accept, acquire, sell or otherwise dispose of the shares of Common Stock, rights to shares of Common Stock (e.g., this Award) or rights linked to the value of shares of Common Stock, during such times you are considered to have “inside information” regarding the Company (as defined by the laws or regulations in your country of residence (and country of Employment, if different). Local insider trading laws and regulations may prohibit the cancellation, forfeiture or amendment of orders you place before you possess inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party (other than on a “need to know” basis) and (ii) “tipping” third parties or causing them otherwise to buy or sell securities. You understand that third parties include fellow employees. Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. You hereby expressly acknowledge that it is your responsibility to be informed of and compliant with such regulations, and should consult with your personal advisor for additional information. (k) Exchange Rates. Neither the Company, your Employer or any Subsidiary shall be liable for any foreign exchange rate fluctuation, where applicable, between your local currency and the United States dollar that may affect the value of an 13

 
Award or of any amounts due to you pursuant to the settlement of this Award or the subsequent sale of any shares of Common Stock acquired under the Plan. (l) Applicable Law. This Agreement shall be subject to and governed by the laws of the Commonwealth of Massachusetts, United States of America without regard to that Commonwealth’s conflicts of law principles. 17. Application of Local Law and Countries Addendum. (a) Notwithstanding Section 16(l), this Award shall be subject to all applicable laws, rules and regulations of your country of residence (and country of Employment, if different) and any special terms and conditions for your country of residence (and country of Employment, if different), including as set forth in the addendum that follows this Agreement ("Countries Addendum"), but limited to the extent required by local law. The Company reserves the right, in its sole discretion, to add to or amend the terms and conditions set out in the Countries Addendum as necessary or advisable in order to comply with applicable laws, rules and regulations or to facilitate the operation and administration of this Award and the Plan, including (but not limited to) circumstances where you transfer residence and/or Employment to another country. (b) As a condition to this Award, you agree to repatriate all payments attributable to the Common Stock acquired under the Plan in accordance with local foreign exchange rules and regulations in your country of residence (and country of Employment, if different). In addition, you also agree to take any and all actions, and consent to any and all actions taken by the Company and its Subsidiaries, as may be required to allow the Company and its Subsidiaries to comply with local laws, rules and regulations in your country of residence (and country of Employment, if different). Finally, you agree to take any and all actions as may be required to comply with your personal legal, tax and other obligations under local laws, rules and regulations in your country of residence (and country of Employment, if different). 18. Data Privacy. The Company is located at One Lincoln Street, Boston, Massachusetts, U.S.A. and grants Awards under the Plan to employees of the Company and its Subsidiaries in its sole discretion. You should carefully review the following information about the Company’s data privacy practices in relation to your Award. (a) Data Collection, Processing and Usage. Pursuant to applicable data protection laws, you are hereby notified that the Company and your Employer collect, process and use certain personal data about you for the legitimate interest of implementing, administering and managing the Plan and generally administering Awards; specifically, including your name, home address, email address and telephone number, date of birth, social security number, social insurance number or other identification number, salary, citizenship, job title, any shares of Common Stock or directorships held in the Company, and details of all Awards or any other incentive compensation awards granted, canceled, forfeited, exercised, vested, or outstanding in your favor, which the Company receives from you or your Employer. In granting Awards under the Plan, the Company will collect your personal data for purposes of allocating Awards and implementing, administering and managing the Plan. The Company’s collection, processing and use of your personal data is necessary for the performance of the Company’s contractual obligations under the Plan and pursuant to the Company’s legitimate interest of managing and generally administering employee incentive 14

 
compensation awards. Your refusal to provide personal data would make it impossible for the Company to perform its contractual obligations and may affect your ability to participate in the Plan. As such, by participating in the Plan, you voluntarily acknowledge the collection, processing and use of your personal data as described herein. (b) Equity Administrator. The Company transfers your personal data to the Equity Administrator, which assists the Company with the implementation, administration and management of the Plan. In the future, the Company may select a different Equity Administrator and share your personal data with another company that serves in a similar manner. The Equity Administrator will open an account for you to track your Award and to ultimately receive and trade shares of Common Stock acquired under the Plan. You will be asked to agree on separate terms and acknowledge data processing practices with the Equity Administrator, which is a condition to your ability to participate in the Plan. (c) Data Retention. The Company will use your personal data only as long as is necessary to implement, administer and manage your participation in the Plan or as required to comply with legal or regulatory obligations, including under tax and security laws. When the Company no longer needs your personal data, the Company will remove it from its systems. If the Company keeps your data longer, it would be to satisfy legal or regulatory obligations and the Company’s legal basis would be for compliance with relevant laws or regulations. For further information about the processing of your personal data, please see the GHR Privacy Notice. ********************************** 15

 
APPENDIX A COUNTRIES ADDENDUM TO [____] DEFERRED STOCK AWARD AGREEMENT STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN A. United States B. Australia C. Austria D. Belgium E. Brazil F. Canada G. Cayman Islands H. China I. Denmark J. France K. Germany L. Hong Kong M. India N. Ireland O. Italy P. Japan Q. Jersey R. Luxembourg S. Netherlands T. Norway U. Poland V. Singapore W. South Africa X. Switzerland Y. Taiwan Z. United Arab Emirates AA. United Kingdom A. UNITED STATES ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with the Company and its Subsidiaries. Failure to comply with the terms and conditions of this Countries Addendum A may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. In addition, your eligibility to participate in the Plan in the future, including any potential future grants of awards under the Plan (or any successor incentive plan of the 16

 
Company), is subject to and conditioned on your compliance with the terms and conditions of this Countries Addendum A. This Countries Addendum A contains a covenant not to compete in Paragraph 5 which shall apply to you at any time that you hold the title of Executive Vice President or higher. You should review it carefully. You may consult with an attorney before accepting the Award. You may consider whether you wish to accept the Award for up to 30 days from the date it was first made available to you on the Website. By accepting the Award, you acknowledge and agree that it is fair and adequate consideration for the covenant not to compete and other promises you make in this Countries Addendum A. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Confidentiality. (a) You acknowledge that you have access to Confidential Information which is not generally known or made available to the general public and that such Confidential Information is the property of the Company, its Subsidiaries or its or their licensors, suppliers or customers. Subject to Paragraph 17, below, you agree specifically as follows, in each case whether during your Employment or following the termination thereof: (i) You will always preserve as confidential all Confidential Information, and will never use it for your own benefit or for the benefit of others; this includes that you will not use the knowledge of activities or positions in clients’ securities portfolio accounts or cash accounts for your own personal gain or for the gain of others. (ii) You will not disclose, divulge, or communicate Confidential Information to any unauthorized person, business or corporation during or after the termination of your Employment with the Company and its Subsidiaries. You will use your best efforts and exercise due diligence to protect, to not disclose and to keep as confidential all Confidential Information. (iii) You will not initiate or facilitate any unauthorized attempts to intercept data in transmission or attempt entry into data systems or files. You will not intentionally affect the integrity of any data or systems of the Company or any of its Subsidiaries through the introduction of unauthorized code or data, or through unauthorized deletion or addition. You will abide by all applicable Corporate Information Security procedures. (iv) Upon the earlier of request or termination of Employment, you agree to return to the Company or the relevant Subsidiaries, or if so directed by the Company or the relevant Subsidiaries, destroy any and all copies of materials in your possession containing Confidential Information. (b) The terms of this Countries Addendum A do not apply to any information which is previously known to you without an obligation of confidence or without breach of this Countries Addendum A, is publicly disclosed (other than by a violation by you of the terms of this Countries Addendum A) either prior to or subsequent to your receipt of such information, or is rightfully received by you from a third party without obligation of confidence and other than in relation to your Employment with the Company or any of its Subsidiaries. 17

 
State Street recognizes that certain disclosures of confidential information to appropriate government authorities or other designated persons are protected by “whistleblower” and other laws. Nothing in this Countries Addendum A is intended to or should be understood or construed to prohibit or otherwise discourage such disclosures. State Street will not tolerate any discipline or other retaliation against employees who properly make such legally-protected disclosures. 2. Assignment and Disclosure. (a) You acknowledge that, by reason of being employed by your Employer, to the extent permitted by law, all works, deliverables, products, methodologies and other work product conceived, created and/or reduced to practice by you, individually or jointly with others, during the period of your Employment by your Employer and relating to the Company or any of its Subsidiaries or demonstrably anticipated business, products, activities, research or development of the Company or any of its Subsidiaries or resulting from any work performed by you for the Company or any of its Subsidiaries, including, without limitation, any track record with which you may be associated as an investment manager or fund manager (collectively, “Work Product”), that consists of copyrightable subject matter is "work made for hire" as defined in the Copyright Act of 1976 (17 U.S.C. § 101), and such copyrights are therefore owned, upon creation, exclusively by State Street. To the extent the foregoing does not apply and to the extent permitted by law, you hereby assign and agree to assign, for no additional consideration, all of your rights, title and interest in any Work Product and any intellectual property rights therein to State Street. You hereby waive in favor of State Street any and all artist’s or moral rights (including without limitation, all rights of integrity and attribution) you may have pursuant to any state, federal or foreign laws, rules or regulations in respect of any Work Product and all similar rights thereto. You will not pursue any ownership or other interest in such Work Product, including, without limitation, any intellectual property rights. (b) You will disclose promptly and in writing to the Company or your Employer all Work Product, whether or not patentable or copyrightable. You agree to reasonably cooperate with State Street (i) to transfer to State Street the Work Product and any intellectual property rights therein, (ii) to obtain or perfect such rights, (iii) to execute all papers, at State Street’s expense, that State Street shall deem necessary to apply for and obtain domestic and foreign patents, copyright and other registrations, and (iv) to protect and enforce State Street’s interest in them. (c) These obligations shall continue beyond the period of your Employment with respect to inventions or creations conceived or made by you during the period of your Employment. 3. Non-Solicitation. (a) This Paragraph 3 shall apply to you at any time that you hold the title of Vice President or higher. (b) You agree that, during your Employment and for a period of six (6) months from the date your Employment terminates for any reason you will not, without the prior written consent of the Company or your Employer: 18

 
(i) solicit, directly or indirectly (other than through a general solicitation of employment not specifically directed to employees of the Company or any of its Subsidiaries), the employment of, hire or employ, recruit, or in any way assist another in soliciting or recruiting the employment of, or otherwise induce the termination of the employment of, any person who then or within the preceding twelve (12) months was an officer of the Company or any of its Subsidiaries (excluding any such officer whose employment was involuntarily terminated); or (ii) engage in the Solicitation of Business from any Client on behalf of any person or entity other than the Company or any of its Subsidiaries. (c) Paragraph 3(b)(i) above shall be deemed to exclude the words “hire or employ” if your work location is in California or New York, and shall be construed and administered accordingly. (i) For purposes of this Paragraph 3, “officer” shall include any person holding a position title of Assistant Vice President or SSGA Principal 4 or higher. Notwithstanding the foregoing, this Paragraph 3 shall be inapplicable following a Change in Control. 4. Notice Period Upon Resignation. (a) This Paragraph 4 shall apply to you at any time that you hold the title of Managing Director or higher (or, any time that you hold the title of Vice President or higher in State Street Global Markets (“SSGM”)). If you are subject to an employment agreement that requires a longer notice period, that employment agreement shall govern. (b) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (i) if you are a member of the Management Committee, you will give 180 days’ advance notice; (ii) if you are an Executive Vice President or higher, you will give ninety (90) days’ advance notice; (iii) if you are a Vice President in SSGM, you will give thirty (30) days’ advance notice; and (iv) otherwise, you will give sixty (60) days’ advance notice. (c) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. (d) In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (e) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits (although you may not be eligible for any new incentive compensation awards or, subject to applicable law, 19

 
to accrue any paid vacation time), and shall continue to comply with the applicable policies of your Employer, the Company and its Subsidiaries. (e) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 4, your Employer, the Company or any of its Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for a period equal to the period for which notice of resignation was required but not provided, and for the period of restriction under Paragraph 5, if applicable, in addition to any other remedies available under law. (f) If you have sixty (60) or fewer days’ notice remaining in your required Notice Period under this Paragraph 4, your Employer, or the Company, or any of its Subsidiaries may, at any time during the remainder of your Notice Period, release you from your obligations under this Paragraph 4 and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum A. (g) Notwithstanding the foregoing, if you hold the title of Executive Vice President or higher this Paragraph 4 shall not apply in the event you terminate your Employment for Good Reason on or prior to the first anniversary of a Change in Control (each as defined in the Plan). 5. Non-Competition. (a) This Paragraph 5 shall apply to you at any time that you hold the title of Executive Vice President or higher, except as provided below. You should review it carefully and may, if you wish, consult with an attorney before accepting this Award. (b) During your Employment and for the twelve (12) months following its termination for any reason (the “Non-Compete Period”), you will not, anywhere in the Restricted Area, for yourself or any other person or entity, directly or indirectly, in any Restricted Capacity, engage in, provide services to, consult for, or be employed by a business that provides products or services competitive with any products or services of your Employer, the Company or any of its Subsidiaries with respect to which you were involved at any time during your Employment or, with respect to the portion of the Non- Compete Period that follows termination of your Employment, within the two years preceding the date of the termination of your Employment. (c) If you reside in or have a primary reporting location in California, then this Paragraph 5 applies only during your Employment, but has no effect after the termination of your Employment for any reason. (d) If you reside in or are employed in Massachusetts and State Street terminates your employment involuntarily not for cause, then this Paragraph 5 applies only during your Employment, but has no effect after such termination. Here, “cause” means (i) your Employer’s or the Company’s good faith determination that it has a reasonable basis for dissatisfaction with your Employment for reasons such as lack of capacity or diligence, failure to conform to usual standards of conduct, or other culpable or inappropriate behavior or (ii) other grounds for discharge that are reasonably related, in your Employer’s or the Company’s honest judgment, to the needs of the business of 20

 
your Employer, the Company or any of its Subsidiaries. In addition, if you violate a fiduciary duty to your Employer, the Company or any of its Subsidiaries, then the post-employment portion of the Non-Compete Period shall be extended by the time during which you engage in such activities, for up to a total of 2 years following termination of your Employment. (e) “Restricted Area” means anywhere that your Employer, the Company or any of its Subsidiaries markets its products or services (which you acknowledge specifically includes the entire world), or with respect to the portion of the Non-Compete Period that follows termination of your Employment, anywhere in which you provided services or had a material presence or influence on behalf of your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination. (f) “Restricted Capacity” means any capacity, or with respect to the portion of the Non-Compete Period that follows termination of your Employment, any capacity that is the same or similar to the capacity in which you were employed by your Employer, the Company or any of its Subsidiaries at any time within the 2-year period immediately preceding such termination and/or involves any services that you provided to your Employer, the Company or any of its Subsidiaries at any time within such 2-year period. 6. Definitions – Countries Addendum. For the purpose of this Countries Addendum A, the following terms are defined as follows: (a) “Client” means a prospective, present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve (12) months prior to the date your Employment with your Employer ends. (b) “Confidential Information” includes but is not limited to all trade secrets, trade knowledge, systems, software, code, data documentation, files, formulas, processes, programs, training aids, printed materials, methods, books, records, client files, policies and procedures, client and prospect lists, employee data and other information relating to the operations of the Company or any of its Subsidiaries and to its or any of their customers, and any and all discoveries, inventions or improvements thereof made or conceived by you or others for the Company or any of its Subsidiaries whether or not patented or copyrighted, as well as cash and securities account transactions and position records of clients, regardless of whether such information is stamped “confidential.” (c) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (d) “Solicitation of Business” means the attempt through direct or indirect contact by you or by any other Person with your assistance to induce a Client to: (i) transfer the Client’s business from the Company or any of its Subsidiaries to any other person or entity; 21

 
(ii) cease or curtail the Client’s business with the Company or any of its Subsidiaries; or (iii) divert a business opportunity from the Company or any of its Subsidiaries to any other person or entity, which business or business opportunity concerns or relates to the business with which you were actively connected during your Employment with the Company or any of its Subsidiaries. (e) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 7. Definition – Award Agreement. For the purpose of the Award Agreement, Restrictive Covenant is defined as follows: “Restrictive Covenant” means any confidentiality, non-solicitation, non-competition, non-disparagement, post-employment cooperation or notice provision that you agree to or had agreed to with your Employer, including but not limited to the restrictions contained in the Award Agreement, any employment agreement or offer letter, deferred compensation award agreement of any type, change in control employment agreement or required as a condition to entitlement to payment under any executive supplemental retirement plan. 8. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum A is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. 9. Non-Disparagement. Subject to Paragraph 17, below, you agree that during your Employment and following the termination thereof you shall not make any false, disparaging, or derogatory statements to any media outlet (including Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry groups, financial institutions, or to any current, former or prospective employees, consultants, clients, or customers of the Company or its Subsidiaries regarding the Company, its Subsidiaries or any of their respective directors, officers, employees, agents, or representatives, or about the business affairs or financial condition of the Company or any of its Subsidiaries. 10. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum A are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum A is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such promises in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries 22

 
shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled. You further agree that, the periods of restriction contained in this Countries Addendum A shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum A, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. Should the Company determine that any portion of the Deferred Shares granted to you in connection with this Award are to be forfeited on account of your breach of the provisions of this Countries Addendum A, any unvested portion of your Award will cease to vest upon such determination. 11. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum A shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 12. Relationship to Other Agreements. This Addendum A supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 13. Interpretation of Business Protections. The agreements made by you in Paragraphs 1, 2, 3, 4 and 5 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum A is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum A is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 14. Assignment. Except as provided otherwise herein, this Countries Addendum A shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 15. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum A, and it shall be deemed to have been accepted by the Company. You agree that this electronic acceptance by both you and the Company shall be deemed equivalent to the Award having been signed by both parties. 16. Notification Requirement. Until forty-five (45) days after the period of restriction under Paragraph 5 expires, you shall give notice to the Company of each new 23

 
business activity you plan to undertake, at least five (5) business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum A. 17. Certain Limitations. (a) Nothing in this Countries Addendum A prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum A requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any Confidential Information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. You shall not be held criminally or civilly liable under any Federal or State trade secret law if you disclose a Company trade secret (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, solely for the purposes of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * * * Entire Agreement. The Plan and the Agreement constitute the complete understanding and agreement between the parties to the Agreement with respect to this Award, and supersedes and cancels any previous oral or written discussions, agreements or representations regarding this Award or the Common Stock. B. AUSTRALIA ______________________________________________________________________ 1. Award Conditioned on Satisfaction of Regulatory Obligations. If you are (a) a director of a Subsidiary incorporated in Australia, or (b) a person who is a management-level executive of a Subsidiary incorporated in Australia and who also is a 24

 
director of a Subsidiary incorporated outside of Australia, the grant of this Award is conditioned upon satisfaction of the shareholder approval provisions of section 200B of the Corporations Act 2001 (Cth) in Australia. 2. Tax Deferral. This Award is intended to be subject to tax deferral under Subdivision 83A-C of the Income Tax Assessment Act 1997 (subject to the conditions and requirements thereunder). 3. Attached Offer Document. The terms of your Award incorporate the rules of the Plan, the Agreement, this Countries Addendum and the provisions of the attached Offer Document. The Offer Document is hereby incorporated into, and forms an integral and material part of, the Agreement and this Countries Addendum. By accepting your Award, you will be bound by the rules of the Plan, the Agreement, this Countries Addendum and the attached Offer Document. 4. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title of Executive Vice President or higher immediately prior to termination of your Employment, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice in writing; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice in writing. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a 25

 
partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any remaining portion of the Notice Period; provided that such action shall not affect your other obligations under this Addendum. (b) Non-Competition. i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co- venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. iii) The period of 12 months referred to in Paragraph 3(b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. 26

 
iv) Nothing in this Paragraph (b) shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. c) Definitions. For the purpose of this Clause 4, the following terms are defined as follows: i) “Client” means a current or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented 27

 
expenses you incur in connection with such cooperation. e) Enforcement. You acknowledge and agree that the promises contained in this Clause 3 are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. h) Interpretation of Business Protections. The agreements made by you in Paragraphs 3(a) and 3(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Addendum is severable and independently enforceable without reference to the enforcement of any other provision. Consistent with the Restraint of Trade Act 1976 (NSW), if any restriction set forth in this Clause 3 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. i) Assignment. Except as provided otherwise herein, this Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Addendum, and it shall be deemed to have been accepted by the Company. 28

 
k) Notification Requirement. During the period of restriction under Paragraph 3(b) above and for a further 45 days after that period of restriction has expired, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Addendum. l) Certain Limitations i) Nothing in this Addendum prohibits you from reporting possible violations of United States federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of United States federal law or regulation. Moreover, nothing in this Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. C. AUSTRIA ______________________________________________________________________ No country-specific provisions. D. BELGIUM ______________________________________________________________________ No country-specific provisions. 29

 
E. BRAZIL ______________________________________________________________________ 1. Compliance with Law. By accepting the Award, you expressly acknowledge and agree to comply with applicable Brazilian laws and to pay any and all applicable taxes associated with the vesting of the Award, the receipt of any dividends, and the sale of shares of Common Stock acquired under the Plan. 2. Labor Law Acknowledgment. You expressly acknowledge and agree that, for all legal purposes, (a) the benefits provided pursuant to the Agreement and the Plan are the result of commercial transactions unrelated to your Employment; (b) the Agreement and the Plan are not a part of the terms and conditions of your Employment; and (c) the income you realize from the Award, if any, is not part of your remuneration from Employment. BY ELECTRONICALLY ACCEPTING THE AGREEMENT AND THIS COUNTRIES ADDENDUM, YOU ACKNOWLEDGE, UNDERSTAND AND AGREE TO THE TERMS AND CONDITIONS OF THE PLAN, YOUR AGREEMENT AND THIS COUNTRIES ADDENDUM. F. CANADA ______________________________________________________________________ 1. Settlement in Shares of Common Stock. Notwithstanding anything to the contrary in the Agreement, this Countries Addendum or the Plan, your Award shall be settled only in shares of Common Stock (and may not be settled in cash). 2. Use of English Language. The following provision will apply if you are a resident of Quebec: You acknowledge and agree that it is your express wish that the Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English. In French: Vous reconnaissez et consentez que c’est votre souhait exprès qui cet accord, de même que tous documents, toutes notifications et tous procédés légaux est entré dans, donné ou instituté conformément ci- annexé ou relatant directement ou indirectement ci-annexé, est formulé dans l’anglais. Une version française de cet Accord peut être consultée sur l’intranet. 30

 
G. CAYMAN ISLANDS ______________________________________________________________________ No country-specific provisions. H. CHINA ______________________________________________________________________ 1. Award Conditioned on Satisfaction of Regulatory Obligations. If you are a national of the Peoples’ Republic of China (“PRC”), this Award is conditioned upon the Company securing all necessary approvals from the PRC State Administration of Foreign Exchange (“SAFE”) to permit the operation of the Plan and the participation of PRC nationals employed by the Company or a Subsidiary, as determined by the Company in its sole discretion. 2. Common Stock Must Remain With Equity Administrator. You agree to hold the shares of Common Stock received upon settlement of this Award with the Equity Administrator until the shares are sold. 3. Exchange Control Restrictions. You understand and agree that, if you are subject to exchange control laws in China, you will be required immediately to repatriate to China the proceeds from the sale of any shares of Common Stock acquired under the Plan. You further understand that such repatriation of proceeds shall be effected through a special bank account established by the Company, and you hereby consent and agree that proceeds from the sale of shares of Common Stock acquired under the Plan may be transferred to such account by the Company on your behalf prior to being delivered to you and that no interest shall be paid with respect to funds held in such account. The proceeds may be paid to you in U.S. dollars or local currency at the Company’s discretion. If the proceeds are paid to you in U.S. dollars, you understand that a U.S. dollar bank account in China must be established and maintained so that the proceeds may be deposited into such account. If the proceeds are paid to you in local currency, you acknowledge that the Company is under no obligation to secure any particular exchange conversion rate and that the Company may face delays in converting the proceeds to local currency due to exchange control restrictions. You agree to bear any currency fluctuation risk between the time the shares of Common Stock are sold and the net proceeds are converted into local currency and distributed to you. You further agree to comply with any other requirements that may be imposed by the Company in the future in order to facilitate compliance with exchange control requirements in China. 4. Sale of Shares upon Termination of Employment. If you are a PRC national and you cease to be employed by the Company and its Subsidiaries for any reason, you will be required to sell all shares of Common Stock acquired upon vesting of 31

 
this Award within such time frame as may be required by the SAFE or the Company (in which case, by accepting this Award, you hereby expressly authorize the Company to issue sales instructions on your behalf). You agree to sign any additional agreements, forms and/or consents that reasonably may be requested by the Company (or the Company’s designated brokerage firm) to effectuate the sale of the shares of Common Stock (including, without limitation, as to the transfer of the sale proceeds and other exchange control matters noted above) and shall otherwise cooperate with the Company with respect to such matters. You acknowledge that neither the Company nor the designated brokerage firm is under any obligation to arrange for such sale of shares of Common Stock at any particular price (it being understood that the sale will occur in the market) and that broker’s fees and similar expenses may be incurred in any such sale. In any event, when the shares of Common Stock are sold, the sale proceeds, less any withholding of Tax-Related Items, any broker’s fees or commissions, and any similar expenses of the sale will be remitted to you in accordance with applicable exchange control laws and regulations. 5. Administration. The Company shall not be liable for any costs, fees, lost interest or dividends or other losses you may incur or suffer resulting from the enforcement of the terms of this Countries Addendum or otherwise from the Company’s operation and enforcement of the Plan, the Agreement and this Award in accordance with Chinese law including, without limitation, any applicable SAFE rules, regulations and requirements. I. DENMARK _____________________________________________________________________ _ 1. Danish Stock Option Act. In accepting the Award, you acknowledge and agree that the Award may be subject to additional terms and conditions, to the extent the Danish Stock Option Act applies to the Award. J. FRANCE ______________________________________________________________________ 1. French Language Version. You may obtain a copy the Agreement in French on the Fidelity Website. In French: Une version française de cet Accord peut être consultée sur l’intranet. K. GERMANY ______________________________________________________________________ 32

 
Subsection (a)(ii) of Section 4 General Circumstances of Forfeiture shall not apply to an Award subject to this Agreement. L. HONG KONG ______________________________________________________________________ 1. IMPORTANT NOTICE. WARNING: The contents of the Agreement, this Countries Addendum, the Plan, and all other materials pertaining to this Award and/or the Plan have not been reviewed by any regulatory authority in Hong Kong. You are hereby advised to exercise caution in relation to the offer thereunder. If you have any doubts about any of the contents of the aforesaid materials, you should obtain independent professional advice. 2. Nature of the Plan. The Company specifically intends that the Plan will not be treated as an occupational retirement scheme for purposes of the Occupational Retirement Schemes Ordinance (“ORSO”). To the extent any court, tribunal or legal/regulatory body in Hong Kong determines that the Plan constitutes an occupational retirement scheme for the purposes of ORSO, the grant of the Deferred Shares shall be null and void. 3. Settlement in Shares of Common Stock. Notwithstanding Section 2(b) of the Agreement, this Award shall be paid in shares of Common Stock only and does not provide any right for you to receive a cash payment. 4. Award Benefits Are Not Wages. This Award and the shares of Common Stock underlying this Award do not form part of your wages for purposes of calculating any statutory or contractual payments under Hong Kong Law. 5. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and 33

 
(2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. (3) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. (iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Section 5 by giving immediate effect to your resignation and making a payment in lieu of any notice due; provided that such action shall not affect your other obligation under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher. (ii) During your Employment and for the 6 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co- venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide 34

 
services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 6 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph (ii) above. (iv) Nothing in this Paragraph 4 shall prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a present or former customer or client of your Employer, the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. A former customer or client means a customer or client for which your Employer, the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (ii) “Products or Services” means any products or services which are the same as, of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. (iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 4(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with your Employer, you will reasonably cooperate with your Employer, the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to 35

 
reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). Your Employer, the Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of this Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs 4(a) and 4(b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 36

 
(i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by your Employer and the Company. (k) Notification Requirement. Until 45 days after the period of restriction under Paragraph (b) expires, you shall give notice to your Employer of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide your Employer with such other pertinent information concerning such business activity as your Employer or the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. (l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify your Employer or the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney- client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. M. INDIA ____________________________________________________________________ No country-specific provisions. 37

 
N. IRELAND ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. All terms and defined terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit your Employer, the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows— (i) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance written notice; and (ii) If you are an Executive Vice President or higher, you will give 90 days’ advance written notice. (iii) For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (b) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence otherwise known as “garden leave” and relieve you of some or all of your duties and responsibilities and to cease attending your place of work and/or to cease contact with the Employer’s employees and customers. During any period of garden leave, you will remain subject to the provisions of this agreement and to your obligation of fidelity to your Employer, the Company and its Subsidiaries. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or, subject to applicable law, to accrue any paid vacation time. (c) You agree that should you fail to provide advance written notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its Subsidiaries shall be entitled to seek injunctive relief restricting you from employment for 38

 
a period equal to the period for which notice of resignation was required but not provided, in addition to any other remedies available under law. (d) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph 1, and give immediate effect to your resignation and make a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligation under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher with the Employer and/or the Company or its Subsidiaries. (b) During your Employment and for the six months (such period to be reduced by the duration of the Notice Period as defined in Paragraph 1 above) following its termination for any reason, you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries within the island of Ireland or the United Kingdom, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries and has the meaning assigned to such by section 7 of the Companies Act 2014. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will make yourself available and reasonably cooperate with the Company or the relevant 39

 
Subsidiary or their advisers with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with such cooperation provided that such expenses are approved in advance by the Company or Employer. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their Confidential Information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s/legal fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as 40

 
to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations. Nothing in this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other relevant disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. O. ITALY ______________________________________________________________________ No country-specific provisions. P. JAPAN ______________________________________________________________________ No country-specific provisions. Q. JERSEY 41

 
______________________________________________________________________ No country-specific provisions. R. LUXEMBOURG ______________________________________________________________________ In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. Your failure to comply with the terms and conditions below may result in the sole determination of the Company in the forfeiture of any or all of the amounts remaining to be paid under this Award. All terms used herein shall have the meaning given to them in the Plan or this Award, except as otherwise expressly provided herein. 1. Notice Period Upon Resignation. (a) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, if you hold the title Executive Vice President or higher you are required to give your Employer advance notice of your resignation as per the legal provisions. (b) During the Notice Period, you will cooperate with your employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in Paragraph (d) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period. (c) You agree that should you fail to provide advance notice of your resignation as required in this Paragraph 1, your Employer, the Company or any of its Subsidiaries shall be entitled to a compensatory payment in addition to any other remedies available under law. (d) At any time during the Notice Period and upon your request formulated in writing, the Company or your Employer may release you from your obligations under this Section 1, and give immediate effect to your resignation; provided that such action shall not affect your other obligations under this Countries Addendum. 2. Non-Competition. (a) This Paragraph 2 shall apply to you at any time that you hold the title of Executive Vice President or higher. (b) During your Employment you will not, directly or indirectly, whether as owner, partner, investor, consultant, agent, co-venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or 42

 
they do business, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries. Specifically, but without limiting the foregoing, you agree not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer, the Company or any of its Subsidiaries for which you have provided services, as conducted or in planning during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. (c) For the 12 months after you leave the company, whatever the reason, you will not, directly or indirectly, as a self-employed person whether as owner, co- venturer or otherwise, compete with your Employer, the Company or any of its Subsidiaries in any geographic area in which it or they do business, or undertake any planning for any business competitive with the business of your Employer, the Company or any of its Subsidiaries, this area being in any case limited to the Grand-Duchy of Luxembourg. Specifically, but without limiting the foregoing, you agree not to engage in any manner as a self-employed person in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, the Company or any of its Subsidiaries as conducted or under consideration at any time during your Employment. The foregoing, however, shall not prevent your passive ownership of two percent (2%) or less of the equity securities of any publicly traded company. 3. Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (a) “Client” means a present or former customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your Employment with the Company or any of its Subsidiaries. A former customer or client means a customer or client for which the Company or any of its Subsidiaries stopped providing all services within twelve months prior to the date your Employment with your Employer ends. (b) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than your Employer, the Company or any of its Subsidiaries. (c) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. 4. Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of- pocket and properly documented expenses you incur in connection with such 43

 
cooperation. 5. Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without limitation its and their confidential information, trade secrets and good will, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your Employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. 6. No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. 7. Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. 8. Interpretation of Business Protections. The agreements made by you in Paragraphs 1 and 2 above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 9. Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. 10. Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 11. Notification Requirement. Until 45 days after the period of restriction 44

 
under Paragraph 2 expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. 12. Certain Limitations (a) Nothing this Countries Addendum prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (b) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, and/or privileges applicable to information covered by the bank secrecy (Article 41 of the Law on the financial sector dated April 5, 1993, as amended), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. S. NETHERLANDS ______________________________________________________________________ 1. Waiver of Termination Rights. As a condition to the grant of this Award, you hereby waive any and all rights to compensation or damages as a result of the termination of Employment with the Company and the Subsidiary that employs you in the Netherlands for any reason whatsoever, insofar as those rights result or may result from (a) the loss or diminution in value of such rights or entitlements under the Plan, or (b) your ceasing to have rights under, or ceasing to be entitled to any awards under the Plan as a result of such termination. T. NORWAY ______________________________________________________________________ 45

 
No country-specific provisions. U. POLAND ______________________________________________________________________ Kopię tej Umowy w języku polskim może Pan/Pani otrzymać wchodząc na Stronę. V. SINGAPORE ______________________________________________________________________ 1. Qualifying Person Exemption. The following provision shall replace Section 16(h) of the Agreement: The grant of the Award under the Plan is being made pursuant to the “Qualifying Person” exemption” under section 273(1)(f) of the Securities and Futures Act (Chapter 289, 2006 Ed.) (“SFA”). The Plan has not been and will not be lodged or registered as a prospectus with the Monetary Authority of Singapore and is not regulated by any financial supervisory authority pursuant to any legislation in Singapore. Accordingly, statutory liability under the SFA in relation to the content of prospectuses shall not apply. You should note that, as a result, the Award is subject to section 257 of the SFA and you will not be able to make (i) any subsequent sale of shares of Common Stock in Singapore or (ii) any offer of such subsequent sale of shares of Common Stock subject to the Award in Singapore, unless such sale or offer is made pursuant to the exemptions under Part XIII Division (1) Subdivision (4) (other than section 280) of the SFA (Chapter 289, 2006 Ed.). W. SOUTH AFRICA ______________________________________________________________________ No country-specific provisions. X. SWITZERLAND ______________________________________________________________________ Securities Law Notice. The offer of the Award is not intended to be publicly offered in Switzerland. Because the offer of the Award is considered a private offering, it is not 46

 
subject to registration in Switzerland. Neither this document nor any other materials relating to the Award constitutes a prospectus as such term is understood pursuant to article 652a of the Swiss Code of Obligations, and neither this document nor any other materials relating to the Award may be publicly distributed nor otherwise made publicly available in Switzerland. Neither this document nor any other offering or marketing material relating to the Award have been or will be filed with, approved or supervised by any Swiss regulatory authority (in particular, the Swiss Financial Market Supervisory Authority (“FINMA”). Y. TAIWAN ______________________________________________________________________ No country-specific provisions. Z. UNITED ARAB EMIRATES ______________________________________________________________________ Securities Law Notice. This document may not be distributed in the Kingdom except to such persons as are permitted under the Rules on the Offer of Securities and Continuing Obligations issued by the Capital Market Authority. The Capital Market Authority does not make any representation as to the accuracy or completeness of this document, and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this document. Prospective recipients of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this document, you should consult an authorized financial adviser. AA. UNITED KINGDOM ______________________________________________________________________ 1. Income Tax and Social Insurance Contribution Withholding. Without limitation to Section 11 of the Agreement, you hereby agree that you are liable for all Tax-Related Items and hereby consent to pay all such Tax-Related Items, as and when requested by the Company and or your Employer (if different) or by HM Revenue & Customs (“HMRC”) (or any other tax authority or any other relevant authority). You also hereby agree to indemnify and keep indemnified the Company and your Employer (if different) against any Tax-Related Items that they are required to pay or withhold on your behalf or have paid or will pay to HMRC (or any other tax authority or any other relevant authority). Notwithstanding the foregoing, if you are a director or executive officer of the Company (within the meaning of Section 13(k) of the Exchange Act), you understand that you may not be able to indemnify the Company for the amount of any income tax not collected from or paid by you within ninety (90) days of the end of the 47

 
U.K. tax year in which the event giving rise to the Tax-Related Items occurs as it may be considered to be a loan and therefore, it may constitute a benefit to you on which additional income tax and National Insurance contributions (“NICs”) may be payable. You understand that you will be responsible for reporting and paying any income tax due on this additional benefit directly to HMRC under the self-assessment regime and for paying to the Company and/or your Employer (as appropriate) the amount of any NICs due on this additional benefit, which may also be recovered from you by any of the means referred to in Section 11 of the Agreement. 2. Exclusion of Claim. You acknowledge and agree that you will have no entitlement to compensation or damages insofar as such entitlement arises or may arise from your ceasing to have rights under or to be entitled to the Deferred Shares, whether or not as a result of such termination, (whether such termination is in breach of contract or otherwise), or from the loss or diminution in value of the Deferred Shares. Upon the grant of your Award, you shall be deemed irrevocably to have waived any such entitlement. 3. Notice and Non-Compete. In consideration of your receipt of this Award, you expressly agree to comply with the terms and conditions below without regard to whether or not any amount has been forfeited, paid, delivered or repaid, under this Award at any time, including the time you separate from service with your Employer, the Company and its Subsidiaries. It is a condition of this Award that, if you fail to comply with the terms and conditions below, then the Company may in its absolute discretion determine that any or all of the amounts remaining to be paid under this Award should be forfeited. All terms used herein shall have the meaning given to them in the Plan or the Award, except as otherwise expressly provided herein. (a) Notice Period Upon Resignation. (i) In order to permit the Company and its Subsidiaries to safeguard their business interests and goodwill in the event of your resignation from Employment for any reason, you agree to give your Employer advance notice of your resignation. The duration of the advance notice you provide (the “Notice Period”) will be determined by your title at the time you deliver such notice, as follows: (1) If you are a member of the State Street Corporation Management Committee, you will give 180 days’ advance notice; and (2) If you are an Executive Vice President or higher, you will give 90 days’ advance notice. For the avoidance of doubt, the Notice Periods set out above shall be subject always to any contractual obligation you have to give a longer period of notice of termination of your Employment (whether such obligation is contained in your contract of Employment or any other agreement to which you are a party). (ii) During the Notice Period, you will cooperate with your Employer, as well as the Company and its Subsidiaries, and provide them with any requested information to assist with transitioning your duties, accomplishing its or their business, and/or preserving its or their client relationships. In its sole discretion, 48

 
during the Notice Period, your Employer or the Company may place you on a partial or complete leave of absence and relieve you of some or all of your duties and responsibilities. Except as provided otherwise in (iii) below, at all times during the Notice Period you shall continue to be an employee of your Employer, shall continue to receive your regular salary and benefits and you will continue to comply with the applicable policies of your Employer, the Company, and its Subsidiaries. However, you will not be eligible for any incentive compensation awards made on or after the first day of the Notice Period or to accrue any vacation save as required by statute. (iii) In its sole discretion, at any time during the Notice Period, the Company or your Employer may release you from your obligations under this Paragraph (a) by giving immediate effect to your resignation and making a payment of basic salary in lieu of any notice due; provided that such action shall not affect your other obligations under this Countries Addendum. (b) Non-Competition. (i) This Paragraph (b) shall apply to you at any time that you hold the title of Executive Vice President or higher and following the termination of your Employment where you held the title of Executive Vice President or higher immediately prior to such termination. (ii) During your Employment and for the 12 months following its termination for any reason, you will not within the Restricted Territory, directly or indirectly, whether as owner, director, partner, investor, consultant, agent, employee, co- venturer or otherwise and whether alone or in conjunction with or on behalf of any other person: (1) become engaged, employed, concerned or interested in or provide technical, commercial or professional advice to, any Person which supplies or provides (or intends to supply or provide) Products or Services in competition with such parts of the business of the Employer or any Relevant Group Company with which you were materially engaged or involved or for which you were responsible during the Relevant Period; (2) compete with your Employer or any Relevant Group Company, or undertake any planning for any business competitive with the business of your Employer or any Relevant Group Company; (3) engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of your Employer, or any Relevant Group Company as conducted or under consideration during the Relevant Period and further agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person who is engaged in any business that is competitive with the business of your Employer or any Relevant Group Company, as conducted or in planning during the Relevant Period. (iii) The period of 12 months referred to in Paragraph (b)(ii) above will be reduced by one day for every day during which, at the Employer’s direction, you are on a complete leave of absence pursuant to Paragraph 3(a)(ii) above. 49

 
(iv) Nothing in this Paragraph (b) shall prevent your ownership for investment purposes only of shares or other securities of two percent (2%) or less of the total issued capital of any company whether or not its securities are publicly traded. (c) Definitions. For the purpose of this Countries Addendum, the following terms are defined as follows: (i) “Client” means a customer or client of the Company or any of its Subsidiaries with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during the Relevant Period. (ii) “Products or Services” means any products or services which are of the same kind as, of a materially similar kind to, or competitive with, any products or services supplied or provided by your Employer or Relevant Group Company and with which you were materially concerned or connected within the Relevant Period. (iii) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, a limited liability partnership, an estate, a trust and any other entity or organization (whether conducted on its own or as part of a wider entity), other than your Employer, the Company or any of its Subsidiaries. (iv) “Relevant Group Company” means the Company and/or any Subsidiaries for which you have performed services or in respect of which you have had operational or managerial responsibility at any time during the Relevant Period. (v) “Relevant Period” means the period of 24 months immediately before the date of termination of your Employment, or (where such provision is applied) the date of commencement of any period of complete leave of absence pursuant to Paragraph 3(a)(ii). (vi) “Restricted Territory” means any area or territory: (1) in which you worked during the Relevant Period; and/or (2) in relation to which you were responsible for, or materially involved in, the supply of Products or Services in the Relevant Period. (vii) “Subsidiaries” means any entity controlling, controlled by or under common control with the Company, including direct and indirect subsidiaries. (d) Post-Employment Cooperation. You agree that, following the termination of your Employment with the Company and its Subsidiaries, you will reasonably cooperate with the Company or the relevant Subsidiary with respect to any matters arising during or related to your Employment, including but not limited to reasonable cooperation in connection with any litigation, governmental investigation, or regulatory or other proceeding (even if such litigation, governmental investigation, or regulatory or other proceeding arises following the date of this Award to which this Countries Addendum is appended or following the termination of your Employment). The Company or any of its Subsidiaries shall reimburse you for any reasonable out-of- pocket and properly documented expenses you incur in connection with such cooperation. (e) Enforcement. You acknowledge and agree that the promises contained in this Countries Addendum are necessary to the protection of the legitimate business interests of your Employer, the Company and its Subsidiaries, including without 50

 
limitation its and their confidential information, trade secrets and goodwill, and are material and integral to the undertakings of the Company under this Award to which this Countries Addendum is appended. You further agree that one or more of your employer, the Company and its Subsidiaries will be irreparably harmed in the event you do not perform such provisions in accordance with their specific terms or otherwise breach the promises made herein. Accordingly, your Employer, the Company and any of its Subsidiaries shall each be entitled to preliminary or permanent injunctive or other equitable relief or remedy without the need to post bond, and to recover its or their reasonable attorney’s fees and costs incurred in securing such relief, in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled, including the immediate forfeiture of any as-yet unvested portion of the Award. You further agree that, the periods of restriction contained in this Countries Addendum shall be tolled, and shall not run, during any period in which you are in violation of the terms of this Countries Addendum, so that your Employer, the Company and its Subsidiaries shall have the full protection of the periods agreed to herein. (f) No Waiver. No delay by your Employer, the Company or any of its Subsidiaries in exercising any right under this Countries Addendum shall operate as a waiver of that right or of any other right. Any waiver or consent as to any of the provisions herein provided by your Employer, the Company or any of its Subsidiaries must be in writing, is effective only in that instance, and may not be construed as a broader waiver of rights or as a bar to enforcement of the provision(s) at issue on any other occasion. (g) Relationship to Other Agreements. This Addendum supplements and does not limit, amend or replace any other obligations you may have under applicable law or any other agreement or understanding you may have with your Employer, the Company or any of its Subsidiaries or pursuant to the applicable policies of any of them, whether such additional obligations have been agreed to in the past, or are agreed to in the future. (h) Interpretation of Business Protections. The agreements made by you in Paragraphs (a) and (b) above shall be construed and interpreted in any judicial or other adjudicatory proceeding to permit their enforcement to the maximum extent permitted by law, and each of the provisions to this Countries Addendum is severable and independently enforceable without reference to the enforcement of any other provision. If any restriction set forth in this Countries Addendum is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. (i) Assignment. Except as provided otherwise herein, this Countries Addendum shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any person or entity which acquires the Company or its assets or business; provided, however, that your obligations are personal and may not be assigned by you. (j) Electronic Acceptance. By accepting this Award electronically, you will be deemed to have acknowledged and agreed that you are bound by the terms of this Countries Addendum, and it shall be deemed to have been accepted by the Company. 51

 
(k) Notification Requirement. Until 45 days after the period of restriction under this Paragraph 3 (b) expires, you shall give notice to the Company of each new business activity you plan to undertake, at least 5 business days prior to beginning any such activity. Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of your business relationship(s) and position(s) with such Person. You shall provide the Company with such other pertinent information concerning such business activity as the Company may reasonably request in order to determine your continued compliance with your obligations under this Countries Addendum. (l) Certain Limitations (i) Nothing this Countries Addendum prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of law or regulation. Moreover, nothing in this Countries Addendum requires you to notify the Company that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (ii) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your Employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney- client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. Your Employer, the Company and its Subsidiaries do not waive any applicable privileges or the right to continue to protect its and their privileged attorney-client information, attorney work product, and other privileged information. * * * * * 52

 
OFFER DOCUMENT STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN OFFER OF DEFERRED STOCK TO AUSTRALIAN RESIDENT EMPLOYEES GRANT DATE: [______________] INVESTMENT IN SHARES INVOLVES A DEGREE OF RISK. EMPLOYEES WHO ELECT TO PARTICIPATE IN THE PLAN SHOULD MONITOR THEIR PARTICIPATION AND CONSIDER ALL RISK FACTORS RELEVANT TO THE PURCHASE OF COMMON STOCK UNDER THE PLAN AS SET OUT IN THIS OFFER DOCUMENT AND THE ADDITIONAL DOCUMENTS. ANY ADVICE CONTAINED IN THIS OFFER DOCUMENT IN RELATION TO THE DEFERRED STOCK BEING OFFERED UNDER THE PLAN DOES NOT TAKE INTO ACCOUNT THE OBJECTIVES, FINANCIAL SITUATION AND NEEDS OF ANY INDIVIDUAL EMPLOYEE. EMPLOYEES SHOULD CONSIDER OBTAINING THEIR OWN FINANCIAL PRODUCT ADVICE FROM AN INDEPENDENT PERSON LICENSED BY THE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION TO GIVE ADVICE ABOUT PARTICIPATING IN THE PLAN. 53

 
OFFER OF DEFERRED STOCK TO AUSTRALIAN RESIDENT EMPLOYEES STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN We are pleased to provide you with this offer to participate in the State Street Corporation 2017 Stock Incentive Plan (and any sub-plan established thereunder) (U.S. Plan) as supplemented for implementation in Australia by the Australian Addendum to the State Street Corporation 2017 Stock Incentive Plan (Australian Addendum). The U.S. Plan as supplemented by the Australian Addendum is hereinafter referenced as the “Plan.” This Offer Document sets out information about grants of Deferred Stock (referenced as “Restricted Common Stock Units” in the U.S. Plan) (Awards) under the Plan and the Deferred Stock Award Agreement (Agreement) to Australian resident employees of subsidiaries of State Street Corporation (Company). The purpose of the U.S. Plan is to advance the interests of the Company by providing for the grant of Common Stock- based Awards. Terms defined in the U.S. Plan and the Australian Addendum have the same meaning in this Offer Document. 1. OFFER This is an Offer of Deferred Stock, as may be granted from time to time in accordance with the Plan by the Company to selected eligible employees of Australian Affiliates. The grant of Deferred Stock under the Plan is intended to comply with the provisions of the Australian Corporations Act 2001 (Cth) (Corporations Act 2001), Australian Securities and Investment Commission (ASIC) Regulatory Guide 49 and ASIC Class Order 14/1000. 2. TERMS OF GRANT The terms of your Award incorporate the rules of the Plan, this Offer Document and your Agreement. By accepting your Award, you will be bound by the rules of this Offer Document, the Plan and your Agreement. 3. ADDITIONAL DOCUMENTS In addition to the information set out in this Offer Document, the following attached documents provide further information necessary to make an informed decision about participating in the Plan: (a) The U.S. Plan and related U.S. prospectus; (b) the Agreement and the Countries Addendum; (c) the Australian Addendum; and 54

 
(d) the Employee Information Supplement. (collectively Additional Documents). The U.S. Plan document sets out, among other details, the nature of your Award and the consequences of a change in the nature or status of your Employment. To the extent of any inconsistency between (a) this Offer Document or the Australian Addendum and (b) any Additional Document (other than the Offer Document and Australian Addendum), the terms of the Offer Document (and Australian Addendum) will apply. 4. RELIANCE ON STATEMENTS You should not rely upon any oral statements made to you in relation to this Offer. You should only rely upon the statements contained in this Offer Document and the Additional Documents when considering your participation in the Plan. 5. WHO IS ELIGIBLE TO PARTICIPATE You are eligible to participate in the Plan if, at the time of the offer, you are an Australian resident employee, officer, consultant, advisor or non-employee Director of the Company or an Australian subsidiary and meet the eligibility requirements established under the Plan. 6. ACCEPTING AN AWARD Your Agreement sets out the key details of your Award. To accept your grant you must expressly accept the Award within the period set out in your Agreement, and in any case no more than thirty (30) days from the date on which the Board made the determination to grant the Award. 7. WHAT ARE THE MATERIAL TERMS OF AN AWARD? (a) What is Deferred Stock? A Deferred Stock Award represents the right to receive shares of Common Stock of the Company on fulfilment of the time-based vesting conditions set out in your Agreement. When your Deferred Stock vests, you will be issued shares of the Company’s Common Stock at no monetary cost to you. The Deferred Stock is considered “restricted” because it will be subject to forfeiture and restrictions on transfer until it vests. The restrictions will be set forth in the attached Agreement. (b) Do I have to pay any money to receive the Deferred Stock Award? No. You do not pay any monetary consideration to receive this Award, and you do not pay any monetary consideration to receive the shares of Common Stock subject to your Award upon vesting. 55

 
(c) How many shares of Common Stock will I receive upon vesting of my Deferred Stock Award? Your Agreement will indicate the number of shares of Common Stock subject to your Award. (d) When do I become a Stockholder? You are not a stockholder merely as a result of holding an Award, and your Award does not entitle you to vote or receive dividends, notices of meeting, proxy statements or other materials provided to stockholders until the shares of Common Stock are issued to you upon vesting. You should also refer to your Agreement for details of the consequences of a change in the nature of your Employment. (e) Can I transfer my Award to someone else? No. However, once shares of Common Stock are issued to you upon vesting, the shares will be freely tradeable and transferable. Please note, though, the possible disclosure obligations included under clause 9. 8. WHAT IS A SHARE OF STOCK IN THE COMPANY? Common stock of a U.S. corporation is analogous to ordinary shares of an Australian company. Each holder of Common Stock is entitled to one vote for every share of Common Stock held in the Company. Dividends may be paid on the shares of Common Stock out of any funds of the Company legally available for dividends at the discretion of the Board of Directors of the Company. The shares of Common Stock are traded on the New York Common Stock Exchange and are traded under the symbol STT. Shares of Common Stock are not liable to any further calls for payment of capital or for other assessment by the Company and have no sinking fund provisions, pre-emptive rights, conversion rights or redemption provisions. 9. HOW CAN I OBTAIN UPDATED INDICATIVE EXAMPLES OF THE CURRENT MARKET PRICE IN AUSTRALIAN DOLLARS? Within a reasonable period following your request, the Company undertakes to provide you with the Australian dollar equivalent of the current market price of a share of Common Stock, (calculated as at the date of your request). The current market price for this purpose will be the final sale price of a share of Common Stock on the New York Common Stock Exchange on the trading day immediately preceding the date of your request. The Australian dollar equivalent of these prices will be calculated using the Australian/U.S. dollar exchange rate published by an Australian bank on the business day immediately preceding the date of your request. Please note that the Australian dollar equivalent of these prices is only provided as information and not as a prediction 56

 
of the Australian dollar equivalent of the fair market value of a share of Common Stock at the time of vesting. The Australian dollar equivalent at these times will depend on the exchange rate applied by your bank in converting your Australian dollars to U.S. Dollars at the time of vesting. The exchange rate is available at: http://www.rba.gov.au/statistics/frequency/exchange-rates.html You should direct your request to: Name: John T. Sheehan Title: Compensation Consultant, Global Benefits & Equity Australian Affiliate means State Street Australia Limited; State Street Global Advisors Australia; State Street Bank and Trust Company – Sydney Branch and any other Associated Body Corporate employing Employees in Australia. Address: State Street Financial Center, 1 Lincoln Street, Boston, MA 02116, USA Phone: +1 617-664-5455 Email: jtsheehan@statestreet.com 10. WHAT ADDITIONAL RISK FACTORS APPLY TO AUSTRALIAN RESIDENTS' PARTICIPATION IN THE PLAN? Employees should consider generally the risk factors connected with investing in securities and, in particular, to holding shares of Common Stock. You should be aware that the fair market value of shares of Common Stock underlying your Award and the future value of shares of Common Stock you acquire and the Australian dollar equivalent of these values will be affected by: (a) fluctuations in the Company's performance; (b) fluctuations in the U.S.$/A$ exchange rate; (c) factors identified from time to time by the Company's filings with the U.S. Securities and Exchange Commission; (d) fluctuations in the domestic and international market for listed stocks (e) general economic conditions including interest rates, inflation rates, commodity and oil prices; (f) changes to governmental fiscal, monetary and regulatory policies; (g) legislation or regulation; (h) the nature of the markets in which the Company operates; and (i) general operational business risks. 57

 
Please note that if you offer your shares of Common Stock for sale to a person or entity resident in Australia, your offer may be subject to disclosure requirements under Australian law. Please obtain legal advice on your disclosure obligations before you make any such offer. 11. PLAN MODIFICATION, TERMINATION, ETC. Subject to Section 9 of the U.S. Plan, the Board may amend, alter, suspend, discontinue or terminate the Plan or any part of it at any time. 12. WHAT ARE THE AUSTRALIAN TAXATION CONSEQUENCES OF PARTICIPATION IN THE PLAN? Please see the Additional Document entitled "Employee Information Supplement – Deferred Stock Awards" for information regarding the Australian tax treatment of your Award. 13. WHAT ARE THE U.S. TAXATION CONSEQUENCES OF PARTICIPATION IN THE PLAN? Employees (who are not U.S. citizens or permanent residents) will not be subject to U.S. tax by reason only of the grant and vesting of the Deferred Stock or the sale of shares of Common Stock, except as described in the dividends section of the “Employee Information Supplement - Deferred Stock”. However, liability for U.S. taxes may accrue if an employee is otherwise subject to U.S. taxes. The above is an indication only of the likely U.S. taxation consequences for Australian resident employees receiving Awards under the Plan. Award recipients should seek their own advice as to the U.S. taxation consequences of Plan participation. 14. RESTRICTION ON CAPITAL RAISING 5% LIMIT In addition to any other limitations as identified in this Offer Document, the Plan or as prescribed by the Board from time to time under the terms of the Plan, there is an overall restriction on the number of shares of Common Stock that can be issued to Australian employees. * * * * * We urge you to carefully review the information contained in this Offer Document and the Additional Documents. If you have any questions, please contact the person listed in Section 9. Yours sincerely, State Street Corporation 58

 
STATE STREET CORPORATION 2017 STOCK INCENTIVE PLAN [____] Deferred Stock Award Agreement--Directors You have elected to defer payment of one or more of the annual stock award, annual retainer or an additional retainer payable to you for your services as a member of the State Street Board of Directors from the date of the [____] Annual Meeting of Shareholders to the date of the [____] Annual Meeting of Shareholders. The total number of shares of Stock you elected to defer (the “Deferred Shares”) is shown on your investment report on the website maintained by the Equity Administrator (Fidelity or another third party designated by the Corporation). The Deferred Shares are granted under the State Street Corporation 2017 Stock Incentive Plan (the “2017 Plan”), and are subject to the terms and conditions contained in the 2017 Plan, the State Street Corporation Deferred Compensation Plan for Directors (the “Deferral Plan”), the related election forms and the terms set forth below. All capitalized terms used herein shall have the meaning given to them in the Deferral Plan, except as otherwise expressly provided herein. 1. The Deferred Shares plus any additional shares of Stock determined under paragraph 3 below (the Deferred Shares plus the shares described in paragraph 3 being hereinafter referred to as the “[____] shares”) will be issued to you [in accordance with the election you made for the [____] shares or as otherwise provided under the terms of the Deferral Plan] [for Canadian directors: as soon as practicable following your Separation from Service and, in any event, no later than the end of the calendar year in which such Separation from Service occurs or, if later, the 15th day of the third month following the date of such Separation from Service. For this purpose, you will not be deemed to have a Separation from Service so long as you continue to provide any services as a director or employee; provided, however, a Separation from Service will be deemed to occur in the event you terminate all positions as an employee or director of the Company, but continue to provide services as a consultant]. In the event of your death prior to the issuance of the [____] shares, the [____] shares will be issued to your [Beneficiary. You may designate a Beneficiary or Beneficiaries (or change a designation previously made)] [for Canadian directors: spouse, relatives, dependent or estate, as the beneficiaries of the trust (your “Permitted Beneficiaries”). You may designate your Permitted Beneficiary] by contacting the Equity Administrator. 2. Any election to change the timing (to a later date) and/or form of payment of the [____] shares must be made in accordance with the terms of the Deferral Plan. Please feel free to contact the Equity Administrator (Fidelity Executive Services, 800 823 0217 – Team 503) or the State Street Head of Executive Compensation if you have any questions regarding the Deferral Plan or wish to request a re-deferral form. 3. You will not have any rights as a stockholder with respect to the [____] shares until they have been issued to you. However, if any dividends and/or distributions

 
(other than distributions described in paragraph 4) are paid on the Stock prior to the date you are issued the [____] shares, the number of [____] shares notionally credited to your account will be increased by the number of shares obtained as follows: by dividing the total applicable dividend or distribution you would have received if you had owned the [____] shares credited to your account on the dividend or other distribution declaration date, by the closing price of a share of Stock on the date the dividend or distribution was paid. 4. The number and kind of shares constituting the [____] shares shall further be appropriately adjusted by the Board to reflect stock splits, stock dividends or similar changes in the capitalization of the Corporation. 5. Your rights to the [____] shares are only those of an unsecured creditor of the Corporation. Nothing herein or in the Deferral Plan or otherwise shall be construed as obligating the Corporation to establish a trust or otherwise to set aside Stock or funds to meet its obligations hereunder or under the Deferral Plan. 6. Nothing herein or in the Deferral Plan or otherwise shall obligate the Corporation to register the shares of Stock to be issued hereunder. You acknowledge that Federal and state securities laws or other laws may limit the extent to which you or your [for Canadian directors: Permitted] Beneficiary(ies) may sell or otherwise transfer or dispose of any shares of Stock issued hereunder. Under currently applicable rules under the Securities Exchange Act of 1934, as amended, you are required to report the award described above as a [____] exempt award. 7. [The Board may at any time vote to accelerate the issuance of the [____] shares to you, but only if doing so would be consistent with the requirements of Section 409A. The Deferral Plan and the award described herein are intended to comply with Section 409A and shall be subject to such modifications as are necessary so to comply.] [for Canadian directors: No additional awards may be made or awards adjusted to reduce the impact to you of any decline in the value of the Deferred Shares.] 8. You agree that as a precondition to the issuance of any of the [____] shares, you will pay to the Corporation such amounts, if any (including, but not limited to, income taxes and social insurance contributions if applicable), as are required to be withheld by the Corporation in respect of the award and payments described herein. 9. The Deferral Plan and the award described herein shall be construed and administered by the Board in accordance with [applicable Federal law, but otherwise pursuant to] the laws of the Commonwealth of Massachusetts [for Canadian directors: to the maximum extent allowed by local law], and the determination of the Board shall be binding on all persons.

 
TRANSITION AND SEPARATION AGREEMENT This is a Transition and Separation Agreement (this “Agreement”) between Jeff Conway (“you”) and State Street Bank and Trust Company, its parent, and their respective direct and indirect subsidiaries and other affiliates (collectively, “State Street” or the “Company”), dated as of March 20, 2019. This Agreement summarizes the severance benefits for which you will be eligible under the State Street Corporation Severance Plan (“Plan”), subject to the terms and conditions specified in this Agreement. A further description of these Severance Benefits is contained in the State Street Corporation Severance Plan Summary Plan Description (“SPD”) which has been provided to you. You should read the SPD carefully. In addition, this Agreement sets forth the terms and conditions of the additional consideration that State Street is offering you in exchange for your agreement not to compete with the business of State Street for a period of time following the termination of your employment. Because you are a “specified employee” within the meaning of Internal Revenue Code Section 409A, certain payments to you will commence or be made to you following the expiration of six months from the termination of your employment, as set forth in Paragraph 4, below. You and State Street agree as follows: 1. TRANSITION PERIOD AND TERMINATION OF EMPLOYMENT. (a) Your employment will terminate on June 1, 2019 unless earlier terminated in accordance with the terms of this Agreement including by mutual agreement of the parties. The actual date your employment terminates is referred to in this Agreement as the “Separation Date.” The period from February 25, 2019 through the Separation Date is referred to as the “Transition Period.” By signing below, you resign from all internal boards and committees of State Street, effective as of the date hereof, and agree promptly to execute any additional documents State Street may determine are necessary to effect such resignation. (b) During the Transition Period, you will continue to be employed as an Executive Vice President, reporting to Ron O’Hanley, or his successor or designee (the “Manager”). You will initially continue to perform such duties as you have previously performed or as the Manager shall specify in his discretion. Commencing on March 13, 2019, or such other date as the Manager may designate, you will commence a garden leave. During this garden leave period, you will not be required to report to the office or perform any work for State Street; provided, however, that you will make yourself available in person or by telephone or other communications technology upon request to perform such services as the Manager may request from time to time. (c) For the duration of the Transition Period, you will comply with all of State Street’s policies and procedures and with your obligations under this Agreement, under your Amended and Restated Employment Agreement dated as of December 13, 2018 (the “Employment Agreement”), and under your existing deferred compensation award agreements and any such other award agreements that you may be offered and accept during the Transition Period (all such award agreements and the incentive compensation plans governing them, the Conway Transition and Separation Agreement 1

 
“Award Agreements”). During the Transition Period and at all times thereafter, you will not make any statements or take any actions on behalf of State Street, unless specifically requested or approved to do so by the Manager. During the Transition Period, if you learn of any opportunities or receive any inquiries, in either case related to the business of the Company, you will promptly disclose the same to the Manager. (d) During the Transition Period, State Street will continue to pay you your base salary, at the rate currently in effect, in accordance with State Street’s standard payroll practices, and you will continue to be eligible to participate in State Street’s employee benefit plans and programs, including paid time off programs, subject to plan terms and generally applicable policies of State Street. Except as specifically provided in this Agreement and in the Award Agreements, you will not be entitled to earn any other compensation of any kind during the Transition Period. During and after the Transition Period, the Award Agreements shall continue to govern your existing and any newly-granted deferred compensation awards and you will continue to be eligible for the tax equalization and tax preparation services set out in the Tax Equalization Policy for International Assignments which was previously provided to you. (e) Your employment will terminate at the end of the Transition Period, if not earlier terminated by State Street for Cause or by mutual agreement. If your employment is terminated by mutual agreement, State Street’s obligations to you under this Paragraph 1 will end on the agreed-upon new Separation Date, provided, however, you will remain eligible to receive the Severance Benefits and other benefits set forth in the other paragraphs of this Agreement, including but not limited to, vesting in Equity and Incentive Compensation Awards and the Additional Consideration described in the Agreement. State Street may terminate your employment for Cause at any time during the Transition Period upon notice. “Cause” means the occurrence of any of the following, as determined by State Street in its sole discretion: (i) your material breach your obligations under this Agreement or any of the Award Agreements; (ii) your committing, being indicted for, or entering into a pre-trial diversion program in connection with, a prosecution for a felony or any crime of dishonesty, breach of trust or money laundering (or any of the same being discovered to have occurred in the past); or (iii) your willful failure to perform, gross negligence in the performance of, or gross misconduct relating in any way to, your duties and responsibilities to State Street. Following a termination for Cause, State Street shall have no further obligation to you under this Agreement other than for Accrued Pay, as defined below. A termination for Cause under this Agreement shall constitute grounds for forfeiture of the unvested portions of the deferred compensation subject to the Award Agreements. (f) Not later than the date that is the later of (i) 5 business days following the Separation Date and (ii) 21 days following the date of this Agreement, except if your employment has been terminated for Cause, you will execute and return to State Street the Post- Employment Release attached to this Agreement as Exhibit A. 2. SEVERANCE BENEFITS. This Paragraph 2 sets forth the benefits State Street will provide you pursuant to the Plan (the “Severance Benefits”), the terms of which are fully incorporated herein, subject to your meeting in full your obligations under this Agreement and its attachments, including without limitation your timely providing the executed Post-Employment Release and not revoking it during the revocation period specified in it. Conway Transition and Separation Agreement 2

 
(a) Severance Pay. State Street will pay you an amount equal to your weekly rate of base pay for a period of 78 weeks following the Separation Date (such period the “Severance Period” and such payments the “Base Severance Payments”). (b) Subsidized Benefits Continuation. You will be eligible to continue coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) at a subsidized rate (with State Street paying its regular employer’s share and you paying the active employee rate) until the Benefits End Date (as defined in Paragraph 3 below). So that you do not experience any gap in coverage, you will be automatically enrolled into COBRA coverage under the same plan and for the same coverage (such as individual or family coverage) as in effect immediately prior to the Separation Date. The cost of COBRA coverage will not be deducted from your Base Severance Payments. Rather, you will be billed directly by our vendor, Fidelity. After the Benefits End Date, you will be eligible to continue coverage for the remainder of your legally- required COBRA period (if any), but this will be entirely at your expense. (c) Enhanced Medical Benefit. (i) Because you are at least age 52, but less than age 55 with five years of eligible service as of your Separation Date, you are eligible to continue medical coverage through State Street until you are age 65 for the same coverage (such as individual or family coverage) as in effect immediately prior to the Separation Date (the “Enhanced Medical Benefit”). The Enhanced Medical Benefit is subject to the terms and conditions of the Severance Plan, including but not limited to State Street’s right to amend or modify at any time the cost structure or administrative treatment of the Enhanced Medical Benefit. (ii) To take advantage of this Enhanced Medical Benefit, you must be enrolled in State Street medical coverage on your Separation Date and continue it through the end of the Severance. At all times, you must also keep current with your share of any premium payments, whether in respect of COBRA continuation coverage or Enhanced Medical Benefit coverage. (iii) At the end of the Severance Period, if you continue to be enrolled in State Street medical coverage, you will be automatically enrolled into the Enhanced Medical Benefit, paying the full retiree medical cost. If at that time, you wish to continue coverage under COBRA instead of auto-enrolling into the Enhanced Medical Benefit, you must actively elect to do so. If you do not enroll into the Enhanced Medical Benefit at the end of the Severance Period, you will be unable to elect this benefit in the future. In addition, if you are rehired by a State Street entity that provides for participation in State Street medical benefit plans, your Enhanced Medical Benefit will end upon such rehire. (d) Outplacement Services. You will be eligible for the level of outplacement services determined by State Street and described in the SPD. In order to utilize outplacement services, you must initiate the services prior to the termination of the Severance Period. 3. NEW EMPLOYMENT. (a) If you accept new employment with State Street or any other employer, or you provide services for State Street as a consultant or through a third party contractor or vendor, at any time before your Severance Period ends, you must immediately notify State Street (as set forth in Paragraph 26 below) of the date you are scheduled to begin such employment (the “New-employment Date”). “State Street,” as used here, includes all affiliated companies such as Conway Transition and Separation Agreement 3

 
International Financial Data Services. “Employment” as used in the first sentence of this paragraph, does not include service as a director and does not include working as a consultant who is not on any company’s payroll. (b) Your right to subsidized benefit continuation (as described in Paragraph 2 above) ends on the last day of the month in which (i) your New-employment Date occurs, or (ii) your Severance Period ends, whichever is first (such date referred to as the “Benefits End Date”). Your Severance Benefits will not be affected by new employment independent of State Street. However, if you are re-hired by State Street or commence work for State Street as an independent contractor or through a third-party agency before the end of your Severance Period, you will forfeit all remaining Severance Benefits, Subsidized Benefits Continuation and Outplacement on your New-employment Date with State Street. 4. PAYMENT RULES. Any amounts payable hereunder will be paid in accordance with the payroll practices and policies set by State Street, and will be subject to all applicable deductions for taxes. Base Severance Payments will be paid in installments on State Street’s regularly-scheduled payroll dates; provided, however, that so much of the Base Severance Payments as would otherwise be payable during the first six months following the Separation Date shall be paid instead in a single lump sum on the next regular payroll date occurring after the day that falls six months and one day after the Separation Date, and the balance of the Base Severance Payments will be paid thereafter on the regular payroll schedule. State Street will deduct from the Base Severance Payments you receive all outstanding financial obligations that you may have to State Street, including without limitation such items as expense account balances, credit card balances, advanced vacation days, and relocation allowances, as well as recompense for any State Street property you fail to return, and you hereby consent to any such deduction to the fullest extent permitted by applicable law. If the Base Severance Payments are insufficient to satisfy your outstanding financial obligations, State Street reserves all rights available to it to recover from you such remaining financial obligations to State Street. 5. ACCRUED PAY. You will receive pay, at your final base rate of salary or wages, for all work performed for State Street from the end of the last payroll period through the Separation Date, to the extent not previously paid, and pay for all hours of vacation time you have earned but not used as of the Separation Date, determined in accordance with State Street policy and records (“Accrued Pay”). Accrued Pay will be paid to you irrespective of whether you accept this Agreement. By signing this Agreement, you acknowledge that you have received all other compensation otherwise due, including but not limited to, pay for all hours worked, commissions, and bonuses through the date you sign this Agreement, and that except as specified in this Agreement and the Award Agreements, you will not be entitled to any other compensation during or after the Transition Period. Conway Transition and Separation Agreement 4

 
6. EQUITY AND INCENTIVE COMPENSATION AWARDS. As referenced in Paragraph 1(c), above, you hold and may be offered certain deferred compensation awards payable in cash and/or stock from State Street pursuant to the Award Agreements. During the Transition Period and following the termination of your employment, the deferred compensation subject to the Award Agreements shall continue to be governed by and to vest in accordance with the terms of the applicable Award Agreements. Nothing in this Agreement is intended to or shall be construed to modify the terms of any Award Agreement; provided, however, the parties acknowledge that under Award Agreements entered into after January 1, 2019, a breach of the Non-Competition or Non-Solicitation Agreements set forth below will result in forfeiture of any unvested or unpaid portion of such award, but will not result in forfeiture of any unvested or unpaid portion of such award entered into on or prior to January 1, 2019 (provided, however, that any such breach of the Non-Competition or Non-Solicitation Agreements that is also a breach of any Award Agreement entered into on or prior to January 1, 2019 may result in forfeiture of unvested or unpaid portions of such awards pursuant to the terms of such Award Agreements). 7. NON-SOLICITATION AND NON-COMPETITION. (a) You agree to abide by the terms of the attached form of Non-Solicitation Agreement, the terms of which are incorporated herein by reference and form an integral and material part hereof. (b) In addition, you agree to abide by the terms of the attached form of Non- Competition Agreement, the terms of which are incorporated herein by reference and form an integral and material part hereof. In consideration of your acceptance of and full compliance with the terms of this Agreement, the Non-Solicitation Agreement and the Non-Competition Agreement, State Street will pay you an additional gross amount of Three Million ($3,000,000) Dollars (“Additional Consideration”), payable in December of 2020, following the expiration of the period of restriction contained in the Non-Competition Agreement. (c) You acknowledge and agree that your right to receive the Severance Benefits and the Additional Consideration is contingent upon your compliance with the terms of this Agreement, including the Confidentiality Agreement, the Non-Solicitation Agreement and the Non-Competition Agreement, as well as your obligations under the Employment Agreement, the Award Agreements and any other incentive compensation plan and/or any non-qualified deferred compensation or retirement plan of State Street (including without limitation the State Street Corporation Executive Supplemental Retirement Plan) that may have previously been agreed to by you that survive termination of your employment by implication or by the terms thereof (collectively, the “Continuing Obligations”). A memorandum dated April 3, 2019 summarizing your Continuing Obligations with respect to non-competition and non-solicitation and State Street’s remedies for breaches of them has been separately provided to you and your attorney. By signing below, you acknowledge receipt of this memorandum. In all events, the terms of the underlying agreements and/or plan documents control your rights and State Street’s. (d) Notwithstanding anything to the contrary herein, you are not prohibited by the non-competition covenants in any of your Continuing Obligations, or in this Agreement, from being employed by McKinsey & Company or Boston Consulting Group to provide business advice to asset managers as long as you do not (i) provide services to any of the nine businesses (including any of their affiliated and subsidiary entities or successors) listed in the memorandum from Kathy Horgan to you dated as of March 21, 2019 referenced in the attached Non- Conway Transition and Separation Agreement 5

 
Competition Agreement or (ii) author or contribute to any papers or articles concerning any business in which State Street was engaged, or was actively in planning to engage, as of the Separation Date. You will remain subject to your confidentiality, non-solicitation and other obligations in connection with any such employment. (e) Except as for your Non-Competition obligations related to the nine businesses (including any of their affiliated and subsidiary entities or successors) listed in the memorandum from Kathy Horgan to you dated as of March 21, 2019 referenced in the attached Non- Competition Agreement, you may seek a waiver from State Street for your non-competition obligations pursuant to your Continuing Obligations, and State Street agrees not to unreasonably and untimely withhold approval for such a waiver, with reasonableness to be determined by State Street’s good faith assessment of the competitive harm which the granting of such waiver could impose on State Street based on (i) your job duties while employed at State Street, (ii) the job duties of the role and the nature of the business for which you seek the waiver, (iii) the Confidential Information to which you had access during your employment at State Street and (iv) the client relationships to which you had access during your employment at State Street. (f) You acknowledge and agree that the provisions contained in this Agreement, including the Confidentiality Agreement, the Non-Solicitation Agreement and the Non- Competition Agreement, as well as the Continuing Obligations, are necessary to the protection of State Street’s business and goodwill, and are material and integral to the undertakings of State Street in this Agreement. You further agree that State Street will be irreparably harmed in the event that you do not perform in accordance with their specific terms or are otherwise in breach those terms. Accordingly, if you fail to comply or threaten to fail to comply with such provisions, State Street shall be entitled to injunctive or other equitable relief or remedy in addition to, and not in lieu of, any other relief or remedy at law to which it or they may be entitled hereunder, without the need to post bond. You agree that any post-employment restricted period set forth in the Non-Solicitation Agreement or the Non-Competition Agreement will be tolled, and will not run, during any period in which you are in breach of your obligations under either. In addition, State Street shall be entitled to recover its reasonable attorneys’ fees and costs incurred in connection with obtaining any relief as a result of your breach as determined by a court of competent jurisdiction of any of your obligations under this Agreement, including the Confidentiality Agreement, the Non-Solicitation Agreement or the Non-Competition Agreement, or the Continuing Obligations. In the event that any provision of the Confidentiality Agreement, the Non-Solicitation Agreement or the Non-Competition Agreement, or the Continuing Obligations is found by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area, or too great a range of activities, such provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law. 8. RETURN OF STATE STREET PROPERTY. You represent that you have returned to State Street (i) all original and duplicate copies (regardless of the medium) of files, books, and records in your possession or under your control belonging to State Street or containing confidential or proprietary information concerning State Street or its customers or operations, and (ii) all State Street keys, credit cards, cell phones, parking transponders, computers and other electronic devices, and any other State Street property. You also represent that you have disclosed to State Street, any password that would be necessary to access or that Conway Transition and Separation Agreement 6

 
would assist in accessing any information that you have stored in password protected form on any of its systems. 9. COMPLIANCE REPRESENTATION. Subject to Paragraph 12, below, you acknowledge that you have notified management of any significant concerns you may have related to State Street’s compliance with securities laws or other laws or regulations applicable to State Street. 10. CONFIDENTIALITY. Subject to Paragraph 12, below: (a) You acknowledge your obligation to keep confidential any non-public information concerning State Street that you acquired during the course of your employment and other associations with State Street, including without limitation the obligations contained in any confidentiality and/or non-disclosure agreement you executed in connection with your employment with State Street, the terms of which shall remain in full force and effect. You further agree to abide by the terms of the attached form of Confidentiality Agreement. (b) You agree that any non-public terms and contents of, and any discussions resulting in, this Agreement shall be maintained in strict confidence, and shall not be disclosed except to the extent required by law or as otherwise agreed to by you and State Street. Notwithstanding the foregoing, you may disclose the existence of this Agreement and its terms to your immediate family members, legal counsel, and other advisors employed by you for the purpose of rendering professional advice related to the terms and conditions of this Agreement, so long as each such person is advised by you of the confidential nature of this Agreement and agrees, prior to disclosure, to abide by the confidentiality provisions hereof. Notwithstanding anything to the contrary herein, you may disclose terms of this Agreement related to Non- Competition and/or Non-Solicitation to prospective employers. 11. NON-DISPARAGEMENT. (a) Subject to Paragraph 12, below, you agree that, as a condition for payment to and retention by you of the consideration herein described, you shall not make any false, disparaging, or derogatory statements to any media outlet (including, but not limited to, Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry groups, financial institutions, any current, former or prospective employees, consultants, clients, or customers of State Street, or any other third party regarding State Street or any of its directors, officers, employees, agents, or representatives, or about State Street’s business affairs or financial condition. (b) State Street will instruct the members of the Management Committee as of the date of this Agreement that they are not to make any false, disparaging, or derogatory statements to any media outlet (including, but not limited to, Internet-based chat rooms, message boards, any and all social media, and/or web pages), industry groups, financial institutions, any current, former or prospective employees, consultants, clients, or customers of State Street, or any other third party regarding you. Conway Transition and Separation Agreement 7

 
12. CERTAIN LIMITATIONS. (a) Nothing in this Agreement, or in the attached Confidentiality Agreement, Non- Solicitation Agreement or Non-Competition Agreement, or in the Continuing Obligations, prohibits you from reporting possible violations of federal law or regulation to any governmental agency or regulatory authority or from making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Moreover, nothing in this Agreement or in the attached Confidentiality Agreement, Non-Solicitation Agreement or Non-Competition Agreement, or in the Continuing Obligations requires you to notify State Street that you have made any such report or disclosure. However, in connection with any such activity, you acknowledge you must take reasonable precautions to ensure that any confidential information that is disclosed to such authority is not made generally available to the public, including by informing such authority of the confidentiality of the same. (b) You shall not be held criminally or civilly liable under any Federal or State trade secret law if you disclose a State Street trade secret (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, solely for the purposes of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Notwithstanding this immunity from liability, you may be held liable if you unlawfully access State Street trade secrets by unauthorized means. (c) Despite the foregoing, you also acknowledge that you are not permitted to disclose to any third-party, including any governmental or regulatory authority, any information learned in the course of your employment that is protected from disclosure by any applicable privilege, including but not limited to the attorney-client privilege, attorney work product doctrine, the bank examiner’s privilege, and/or privileges applicable to information covered by the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), including information that would reveal the existence or contemplated filing of a suspicious activity report. State Street does not waive any applicable privileges or the right to continue to protect its privileged attorney-client information, attorney work product, and other privileged information. 13. GENERAL RELEASE OF CLAIMS. In exchange for the promises contained in this Agreement, you, individually and on behalf of your respective heirs, executors, beneficiaries, representatives, administrators, successors and assigns, hereby fully, forever, irrevocably, and unconditionally release, remise, and discharge State Street, State Street’s employee benefit and compensation plans, programs or arrangements, welfare benefit and pension benefit plans and plan administrators, predecessors, successors, and assigns, and any and all of its or their past, present and future directors, officers, shareholders, agents, employees, trustees, fiduciaries, representatives, insurers, and assigns (whether acting as agents for State Street or in their individual capacity) (individually and collectively referred to as “Releasees”) from and with respect to any and all claims, demands, charges, liabilities, damages, actions, causes of action and suits of every type whatsoever, in law or at equity (collectively, “Claims”), including without limitation Claims related to or arising out of your employment or its termination, including but not limited to: Conway Transition and Separation Agreement 8

 
(a) all Claims under any local, state or federal discrimination, fair employment practices and other employment-related statute, regulation or executive order (as they may have been amended) prohibiting discrimination, harassment or retaliation based upon any protected status including, without limitation, race, ethnicity, national origin, age, gender, pregnancy, marital status, disability, veteran status and sexual orientation. Without limitation, specifically included in this paragraph are any Claims arising under the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans with Disabilities Act, the Rehabilitation Act of 1973, Section 806 of the Corporate Fraud Accountability Act of 2002, the Equal Pay Act, the Vietnam Era Veterans' Readjustment Assistance Act of 1974, Executive Orders 11246 and 11141, and, to the fullest extent enforceable under applicable law, all similar federal, state or local statutes, regulations and orders; (b) all Claims under any other local, state or federal employment-related statute, regulation or executive order (as they may have been amended) relating to any terms and conditions of employment or separation from employment, to the fullest extent enforceable under applicable law. Without limitation, specifically included in this paragraph are any Claims arising under the Family and Medical Leave Act of 1993, the National Labor Relations Act, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Worker Adjustment Retraining Notification Act (“WARN”), including any claims regarding advance notice of termination pursuant to WARN, the Fair Credit Reporting Act, and all similar federal, state or local statutes, regulations and orders; (c) all Claims for short-term disability benefits, and Claims to any non-vested ownership interest in State Street provided through participation in a State Street plan or program other than the awards subject to the Award Agreements; (d) all Claims under any state or federal common law theory including, without limitation, wrongful discharge, breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion of privacy, misrepresentation, deceit, fraud or negligence; (e) any other Claims, whether known or unknown, suspected or unsuspected, and whether or not concealed or hidden, which you now have, may have or may have had against any of the Releasees, up to the date you sign this Agreement, including without limitation claims arising out of or in any way related to your employment with or separation from State Street (including claims for retaliation); and (f) all Claims arising under the wage and hour and wage payment laws of the Commonwealth of Massachusetts. 14. COVENANT NOT TO SUE. Subject to Paragraph 12, above, and to the extent permitted by law, you represent that you have not filed any complaints, claims or actions concerning any of the Claims released by you in Paragraph 13 with any state, federal, or local agency or court. In addition to waiving and releasing Claims as described in Paragraph 13, you hereby covenant not to sue the Releasees in respect of any of the Claims released in Paragraph 13. This “covenant not to sue” is different from the general release of claims contained in Conway Transition and Separation Agreement 9

 
Paragraph 13; for by covenanting not to sue the Releasees, you are agreeing that you will not hereafter pursue any individual Claim concerning any of the Claims you released in Paragraph 13 by filing such a Claim in any local, state, or federal court. 15. FURTHER LIMITATIONS. (a) Your execution of this Agreement, including the general release of claims in Paragraph 13 and the covenant not to sue in Paragraph 14, shall not release or restrict you from making (a) claims to enforce the provisions of the Agreement; (b) claims and rights under the Award Agreements with respect to any deferred compensation awards that you continue to hold following the date hereof; (c) claims that cannot be waived as a matter of law, including claims for unemployment benefits; (d) rights to vested benefits under any applicable welfare, retirement and/or pension plans (e) claims challenging the knowing and voluntary nature of this release under the Workers Benefit Protection Act and the Age Discrimination in Employment Act; (f) rights you may have to defense, indemnification, and contribution from State Street for actions taken by you in the course and scope of your employment with State Street, including rights pursuant to applicable law, the foundational documents of State Street or any of its subsidiaries or other affiliates, any applicable D&O policy of State Street or any of its subsidiaries or other affiliates, or any other applicable agreement, program or arrangement; or (g) claims that arise after the date of this Agreement. (b) You and State Street also agree that this Agreement will not affect the rights and responsibilities of the United States Equal Employment Opportunity Commission (“EEOC”) and state or local Fair Employment Practices Agencies to enforce the anti-discrimination laws of the United States, and that nothing in this Agreement prevents you from filing, cooperating with, or participating in any proceeding before the EEOC or any state or local Fair Employment Practices Agency. However, you represent and warrant that you knowingly and voluntarily waive all rights and claims arising prior to your execution of this Agreement, as well as rights to any payment, benefit, attorneys’ fees or other personal remedial relief as a consequence of any charge filed with or by the EEOC or analogous state or local agency and/or any litigation pursued by the EEOC concerning any facts alleged in any such charge. Nothing in this Agreement prevents you from complying with a lawful subpoena or court order. 16. EMPLOYEE’S BREACH OF THIS AGREEMENT. You acknowledge that your right to receive the Severance Benefits and the other benefits provided under this Agreement is expressly conditioned on your continuing and complete performance of your material obligations under this Agreement, including without limitation the covenant not to sue contained in Paragraph 14 of the Agreement as limited by Paragraph 15. If you materially breach any of the terms of this Agreement, the Employment Agreement, the Award Agreements, the Confidentiality Agreement, the Non-Competition Agreement or the Non-Solicitation Agreement, State Street reserves its right, if applicable, to cease payment of any then-remaining Severance Pay or other benefits set forth in this Agreement. You agree that such cessation or recoupment will not invalidate this Agreement, and further acknowledge that you will remain bound by all of the terms of this Agreement, including without limitation the release of claims in Paragraph 13. Further, if you breach the covenant not to sue contained in Paragraph 14 of this Agreement, as determined by a court of competent jurisdiction, you will be liable for all expenses, costs and attorneys’ fees incurred in defending such claims, complaint or causes of action to the fullest extent allowed by applicable law. Conway Transition and Separation Agreement 10

 
17. NOTICE OF RIGHTS. (a) You may consider the terms of this Agreement for 21 days from the day you first received it, which was March 21, 2019. You agree that if there have been any changes to a prior version of this Agreement (material or immaterial), the 21-day period set forth here will not be reset. (b) You may elect to revoke this Agreement for a period of seven (7) business days after signing the Agreement. Your written notice to revoke must be received by State Street within seven (7) business days of the date you signed this Agreement. The Agreement shall not be effective or binding until the expiration of this seven (7)-business-day revocation period (the “Revocation Period”). (c) You are hereby notified of your right to consult an attorney of your choosing, and you are advised to do so before signing and returning this Agreement. 18. ACKNOWLEDGEMENTS. (a) You acknowledge that this Agreement is written in a manner which you understand, and that you understand your obligations under this Agreement. (b) You acknowledge that your execution of this Agreement is in exchange for good and valuable consideration paid by State Street which you would not otherwise be entitled to receive. (c) You acknowledge that no other promises or agreements of any kind have been made to or with you by any person or entity whatsoever to cause you to sign this Agreement, that you freely and voluntarily assent to all of the terms and conditions of this Agreement, and that you sign your name as your own free act and deed. 19. COOPERATION. You agree to cooperate reasonably with State Street with respect to all matters arising during or related to your employment, including, but not limited to, all matters (formal or informal) in connection with any government investigation, internal State Street investigation, litigation (potential or ongoing), regulatory or other proceeding which may have arisen prior to or which may arise following the signing of this Agreement. State Street agrees that such cooperation shall be at mutually agreed upon times and locations, and shall not interfere with any subsequent employment you may have. State Street shall reimburse you for any reasonable out-of-pocket and properly documented expenses you incur in connection with any such cooperation. 20. REFERENCES. It is State Street policy not to provide references to potential future employers of its former employees. You agree that you will refer potential future employers only to the Company’s job information line, The Work Number, at either www.theworknumber.com or via telephone at (800) 367-5690. The Work Number will verify your dates of employment, your final rate of pay and the positions you held. For the purpose of accessing the Work Number, you will give potential future employers the Company’s company code, which is 70027. Conway Transition and Separation Agreement 11

 
21. NON-ADMISSION. You understand and agree that neither this Agreement nor anything provided herein constitutes an admission that State Street and/or any of the Releasees has violated any law or has any legal liability to you. 22. APPLICABLE LAW. This Agreement will be governed by and construed under the laws of the Commonwealth of Massachusetts. If any case or controversy arises under this Agreement, any action will be brought in a court of the Commonwealth of Massachusetts or the United States District Court for the District of Massachusetts, and each party will submit to each such court’s jurisdiction. 23. VALIDITY. If any provisions of this Agreement (or, with respect to Paragraph 13, the release of any Claim) shall be determined by any court of competent jurisdiction to be illegal or invalid, the validity of the remaining terms will not be affected thereby, and said illegal or invalid term will be deemed not to be part of this Agreement. Provided, however, if Paragraph 13 is deemed to be invalid in its entirety, then this Paragraph 23 shall not apply. 24. NO WAIVER. No delay or omission by State Street in exercising any right under this Agreement or its attachments shall operate as a waiver of that or any other right. A waiver or consent given by State Street on any one occasion shall be effective only in that instance, and shall not be construed as a bar or waiver of any right on any other occasion. 25. ENTIRE AGREEMENT. More than one copy of this Agreement may be signed, each of which when signed will be deemed an original. This Agreement constitutes the complete understanding and agreement between the parties to this Agreement with respect to the settlement of all matters between them, and, except as provided herein, supersedes and cancels all previous oral and written negotiations, agreements, and representations regarding such matters. For the avoidance of doubt, the Continuing Obligations and Award Agreements shall remain in full force and effect in accordance with their terms, including but not limited to any restrictive covenants and other conditions contained therein. 26. NOTICES. All notices and correspondence concerning this Agreement will be in writing and may be mailed or delivered to: In the Case of State Street: Kathryn M. Horgan, Executive Vice President, Chief Global Human Resources and Citizenship Officer, State Street Bank and Trust Company, One Lincoln Street, SFC-11, Boston, MA 02111. In the Case of Employee: The last home address you have provided to State Street during employment or thereafter to the State Street GHR Service Center at (1-855-447-7007). (The remainder of this page is intentionally left blank.) Conway Transition and Separation Agreement 12

 
27. BINDING EFFECT OF AGREEMENT; RIGHT TO MODIFY. This Agreement will be binding upon and will inure to the benefit of the parties to the Agreement and their respective heirs, successors and assigns. Notwithstanding anything else to contrary, nothing in this Agreement will in any way affect State Street’s right to change, modify, or terminate any employee benefit plan or program, including the cost of coverage charged, at any time in the future with respect to any benefits provided to active, inactive, retired, or former employees of State Street or their covered dependents. STATE STREET BANK AND TRUST COMPANY By: _/s/ Kathryn M. Horgan________ Date: 4/3/19 Kathryn M. Horgan Executive Vice President Chief Global Human Resources and Citizenship Officer Voluntarily accepted and agreed to by Employee: __/s/ Jeff Conway__________________ Date: 4/4/19 Jeff Conway Conway Transition and Separation Agreement 13

 

 
EXHIBIT A POST-EMPLOYMENT GENERAL RELEASE OF CLAIMS FOR AND IN CONSIDERATION OF certain benefits to be provided me in connection with the termination of my employment, as set forth in the agreement between me and State Street Bank and Trust Company, its parent, and their respective direct and indirect subsidiaries and other affiliates (collectively, “State Street” or the “Company”), dated as of March 20, 2019 (the “Agreement”), which are conditioned on my signing this Post-Employment General Release of Claims (this “Release of Claims”) and to which I am not otherwise entitled, I, individually and on behalf of my respective heirs, executors, beneficiaries, representatives, administrators, successors and assigns, hereby fully, forever, irrevocably, and unconditionally release, remise, and discharge State Street, State Street’s employee benefit and compensation plans, programs or arrangements, welfare benefit and pension benefit plans and plan administrators, predecessors, successors, and assigns, and any and all of its or their past, present and future directors, officers, shareholders, agents, employees, trustees, fiduciaries, representatives, insurers, and assigns (whether acting as agents for State Street or in their individual capacity) (individually and collectively referred to as “Releasees”) from and with respect to any and all claims, demands, charges, liabilities, damages, actions, causes of action and suits of every type whatsoever, in law or at equity (collectively, “Claims”), including without limitation Claims related to or arising out of my employment or its termination, including but not limited to: (a) all Claims under any local, state or federal discrimination, fair employment practices and other employment-related statute, regulation or executive order (as they may have been amended) prohibiting discrimination, harassment or retaliation based upon any protected status including, without limitation, race, ethnicity, national origin, age, gender, pregnancy, marital status, disability, veteran status and sexual orientation. Without limitation, specifically included in this paragraph are any Claims arising under the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans with Disabilities Act, the Rehabilitation Act of 1973, Section 806 of the Corporate Fraud Accountability Act of 2002, the Equal Pay Act, the Vietnam Era Veterans' Readjustment Assistance Act of 1974, Executive Orders 11246 and 11141, and, to the fullest extent enforceable under applicable law, all similar federal, state or local statutes, regulations and orders; (b) all Claims under any other local, state or federal employment-related statute, regulation or executive order (as they may have been amended) relating to any terms and conditions of employment or separation from employment, to the fullest extent enforceable under applicable law. Without limitation, specifically included in this paragraph are any Claims arising under the Family and Medical Leave Act of 1993, the National Labor Relations Act, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Worker Adjustment Retraining Notification Act (“WARN”), including any claims regarding advance notice of termination pursuant to WARN, the Fair Credit Reporting Act, and all similar federal, state or local statutes, regulations and orders; (c) all Claims for short-term disability benefits, and Claims to any non-vested ownership interest in State Street provided through participation in a State Street plan or program other than the awards subject to the Award Agreements (as defined in the Agreement); Conway Transition and Separation Agreement Exhibit A Page 1

 
(d) all Claims under any state or federal common law theory including, without limitation, wrongful discharge, breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion of privacy, misrepresentation, deceit, fraud or negligence; (e) any other Claims, whether known or unknown, suspected or unsuspected, and whether or not concealed or hidden, which I now have, may have or may have had against any of the Releasees, up to the date I sign this Release of Claims, including without limitation claims arising out of or in any way related to my employment with or separation from State Street (including claims for retaliation); and (f) all Claims arising under the wage and hour and wage payment laws of the Commonwealth of Massachusetts. Subject to Paragraph 12 of the Agreement, and to the extent permitted by law, I represent that I have not filed any complaints, claims or actions concerning any of the Claims released by me above with any state, federal, or local agency or court. In addition to waiving and releasing Claims as described above, I hereby covenant not to sue the Releasees in respect of any of the Claims released above. This “covenant not to sue” is different from the general release of claims contained above; for by covenanting not to sue the Releasees, I am agreeing that I will not hereafter pursue any individual Claim concerning any of the Claims I released above by filing such a Claim in any local, state, or federal court. My execution of this Release of Claims shall not release or restrict me from making (a) claims to enforce the provisions of the Agreement; (b) claims and rights under the Award Agreements (as defined in the Agreement) with respect to any deferred compensation awards that I continue to hold following the date hereof; (c) claims that cannot be waived as a matter of law, including claims for unemployment benefits; (d) rights to vested benefits under any applicable welfare, retirement and/or pension plans (e) claims challenging the knowing and voluntary nature of this release under the Workers Benefit Protection Act and the Age Discrimination in Employment Act; (f) rights I may have to defense, indemnification, and contribution from State Street for actions taken by me in the course and scope of my employment with State Street, including rights pursuant to applicable law, the foundational documents of State Street or any of its subsidiaries or other affiliates, any applicable D&O policy of State Street or any of its subsidiaries or other affiliates, or any other applicable agreement, program or arrangement; or (g) claims that arise after the date of this Release. I and State Street also agree that this Release of Claims will not affect the rights and responsibilities of the United States Equal Employment Opportunity Commission (“EEOC”) and state or local Fair Employment Practices Agencies to enforce the anti-discrimination laws of the United States, and that nothing in this Release of Claims prevents me from filing, cooperating with, or participating in any proceeding before the EEOC or any state or local Fair Employment Practices Agency. However, I represent and warrant that I knowingly and voluntarily waive all rights and claims arising prior to my execution of this Release of Claims, as well as rights to any payment, benefit, attorneys’ fees or other personal remedial relief as a consequence of any charge filed with or by the EEOC or analogous state or local agency and/or any litigation pursued by the EEOC concerning any facts alleged in any such charge. Nothing in this Release of Claims prevents me from complying with a lawful subpoena or court order. Conway Transition and Separation Agreement Exhibit A Page 2

 
In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to the termination of my active employment, but that I may consider the terms of this Release of Claims until the later of the date that is (i) five (5) business days from the Separation Date and (ii) twenty-one (21) days from the date that I received the Agreement and this Exhibit A. I also acknowledge that I am advised by State Street to seek the advice of an attorney prior to signing this Release of Claims; that I have had sufficient time to consider this Release of Claims and to consult with an attorney, if I wished to do so, or to consult with any other person of my choosing before signing (subject to Section 10(b) of the Agreement); and that I am signing this Release of Claims voluntarily and with a full understanding of its terms. I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or representations, express or implied, that are not set forth expressly in the Agreement. I understand that I may revoke my acceptance of this Release of Claims as to claims under the Age Discrimination in Employment Act at any time within seven (7) business days of the date of my signing by written notice delivered to State Street in accordance with the terms of the Agreement, and that this Release of Claims will take effect as to the release of such claims only upon the expiration of such seven-business-day revocation period and only if I have not timely revoked it. This Release of Claims, together with the Agreement, constitute the complete understanding and agreement between me and State Street with respect to the settlement of all matters between us, and, except as provided herein, supersede and cancel all previous oral and written negotiations, agreements, and representations regarding such matters. For the avoidance of doubt, the Continuing Obligations and Award Agreements shall remain in full force and effect in accordance with their terms, including but not limited to any restrictive covenants and other conditions contained therein. Intending to be legally bound, I have signed this Release of Claims under seal as of the date written below. Signature: __/s/ Jeff Conway______________________ Name (please print): Date Signed: __4/4/19____________________________ Conway Transition and Separation Agreement Exhibit A Page 3

 

 
NON-SOLICITATION AGREEMENT In consideration of the Severance Benefits, the Additional Consideration, and the other benefits to be provided to you under the Transition and Separation Agreement to which this Non- Solicitation Agreement is appended and of which it forms a material part, you agree that the restrictions set forth in this Non-Solicitation Agreement are necessary to protect the goodwill, Confidential Information (including trade secrets) and other legitimate interests of State Street. You agree that during your employment and for a period of eighteen (18) months from the date of termination of your employment you will not, without the prior written consent of State Street or the legal entity with whom you are employed: (a) solicit, directly or indirectly (other than through a general solicitation of employment not specifically directed to employees of State Street or its Subsidiaries), the employment of, hire or employ, recruit, or in any way assist another in soliciting or recruiting the employment of, or otherwise induce the termination of the employment of, any person who then or within the preceding eighteen (18) months was an officer of State Street (excluding any such officer whose employment was involuntarily terminated); or (b) engage in the Solicitation of Business from any Client on behalf of any person or entity other than State Street. The provisions in subsections (a) and (b) above do not limit, amend or supersede any greater or more restrictive obligations or undertakings you may have under applicable law or other agreements or arrangements with State Street. As used here— “Officer” means any person holding a position title of Assistant Vice President or SSGA Principal 4 or higher. “Client” means a present or former customer or client of State Street with whom you have had, or with whom persons you have supervised have had, substantive and recurring personal contact during your employment with State Street. A former customer or client means a customer or client for which State Street stopped providing all services within twelve months prior to the date your employment with State Street ends. “Solicitation of Business” means the attempt through direct or indirect contact by you or by any other person or entity with your assistance to induce a Client to: (i) transfer the Client’s business from State Street to any other person or entity; (ii) cease or curtail the Client’s business with State Street; or (iii) divert a business opportunity from State Street to any other person or entity, which business or business opportunity concerns or relates to the business with which you were actively connected during your employment with State Street. Conway Transition and Separation Agreement Non-Solicitation Agreement

 

 
NON-COMPETITION AGREEMENT In consideration of the Severance Benefits, the Additional Consideration, and the other benefits to be provided to you under the Transition and Separation Agreement to which this Non- Competition Agreement is appended and of which it forms a material part, you agree that the restrictions set forth in this Non-Competition Agreement are necessary to protect the goodwill, Confidential Information (including trade secrets) and other legitimate interests of State Street. You agree that, for eighteen (18) months following the date of the termination of your employment under the Transition and Separation Agreement for any reason (in the aggregate, the “Non-Compete Period”), you will not, anywhere in the Restricted Area, for yourself or any other person or entity, directly or indirectly, in any capacity, engage in, provide services to, consult for, or be employed by any of the businesses (including any of their affiliated and subsidiary entities or successors) listed in the memorandum from Kathy Horgan to you dated as of March 21, 2019. By signing the Transition and Separation Agreement, you acknowledge receipt of the memorandum. As used here— “Restricted Area” means anywhere that State Street markets its products or services (which you acknowledge specifically includes the entire world). Conway Transition and Separation Agreement

 
CONFIDENTIALITY AGREEMENT Subject to Paragraph 12 of the Transition and Separation Agreement to which this is attached and of which it forms a material part, you acknowledge that during your employment you had access to Confidential Information and that such Confidential Information is the property of State Street and/or its licensors, suppliers or clients. You agree specifically as follows, in each case whether during your employment or following its termination: (a) You will always preserve as confidential all Confidential Information, and will never use it for your own benefit or for the benefit of others or in any way that could have a negative impact on the financial condition or reputation of State Street, its Subsidiaries, and/or its or their licensors, suppliers or customers; this includes that you will not use the knowledge of activities or positions in clients’ securities portfolio accounts or cash accounts for your own personal gain or for the gain of others. (b) You will not disclose, divulge, or communicate Confidential Information to any unauthorized person, business or corporation during or after the termination of your employment with State Street. You will use your best efforts and exercise due diligence to protect, to not disclose and to keep as confidential all Confidential Information. (c) You will not initiate or facilitate any unauthorized attempts to intercept data in transmission or attempt entry into State Street systems or files. You will not intentionally affect the integrity of any State Street data or systems through the introduction of unauthorized code or data, or through unauthorized deletion or addition. You will abide by all applicable Corporate Information Security procedures. The terms of this agreement do not apply to any information which was previously known to you prior to the date of your employment with State Street without an obligation of confidence or without breach of this agreement, is or was publicly disclosed (other than by a violation by you of the terms of this agreement) either prior to or subsequent to your receipt of such information, or was rightfully received by you from a third party without obligation of confidence and other than in relation to your employment with State Street. As used here, “Confidential Information” means any and all information of State that is not generally available to the public, and includes any information received by State Street from any third party with the understanding, express or implied, that it would be kept confidential. By way of example, Confidential Information includes but is not limited to all trade secrets, trade knowledge, systems, software, code, data documentation, files, formulas, processes, programs, training aids, printed materials, methods, books, records, client files, policies and procedures, client and prospect lists, employee data and other information relating to the operations of State Street and to its customers, and information concerning any and all discoveries, inventions or improvements thereof made or conceived by you or others for State Street whether or not patented or copyrighted, as well as cash and securities account transactions and position records and track records of clients, regardless of whether such information is formally designated as “confidential.” Conway Transition and Separation Agreement

 
Exhibit 10.5 STATE STREET CORPORATION MANAGEMENT SUPPLEMENTAL SAVINGS PLAN Amended and Restated Effective as of January 1, 2014 FINAL 2014 Restatement 9.15.14.DOC -i- TABLE OF CONTENTS Page ARTICLE I NAME AND PURPOSE OF PLAN AND DEFINITIONS 1 1.1 Name and effective date 1 1.2 Status of Plan 1 1.3 Definitions 1 ARTICLE II ELIGIBILITY AND PARTICIPATION 5 2.1 Eligibility to participate 5 2.2 Commencement of participation 5 2.3 Termination of participation 5 ARTICLE III DEFERRED COMPENSATION AGREEMENTS, MATCHING CREDITS, performance- based credits, NOTIONAL INVESTMENT OF ACCOUNTS 6 3.1 Deferred Compensation Agreement; Elective Credits 6 3.2 Election procedures and deadlines. 6 3.3 Amount of deferrals. 6 3.4 Matching Credit 7 3.5 Accounts 7 3.6 Cancellation of Deferral Elections 7 ARTICLE IV VESTING 9

 
4.1 Vesting of Accounts 9 ARTICLE V PLAN DISTRIBUTIONS 10 5.1 Time and form of payment: Matching Credits and Performance-Based Credits 10 5.2 Time and form of payment: other portions of the Account 10 5.3 Special rules. 11 5.4 Unforeseeable emergency 12 5.5 Certain tax matters 12 5.6 Distribution of taxable amounts 12 5.7 Special Rule for 2007 12 ARTICLE VI ADMINISTRATION OF THE PLAN 14 6.1 Plan Administrator 14 6.2 Outside services 14 6.3 Indemnification 14 6.4 Claims procedure 14 ARTICLE VII AMENDMENT AND TERMINATION 15 7.1 Amendment; termination 15 7.2 Effect of amendment or termination 15 ARTICLE VIII MISCELLANEOUS PROVISIONS 16 8.1 Source of payments 16 8.2 Other arrangements made subject to the Plan 16 8.3 No warranties 16 8.4 Inalienability of benefits 16 8.5 Reclassification of Employment Status 16 8.6 Expenses 16 8.7 No right of employment 17 8.8 Headings 17 8.9 Acceptance of Plan terms 17 8.10 Construction 17 EXHIBIT A List of Employers................................................................................................18 EXHIBIT B Claims Procedures...............................................................................................19 ARTICLE I ARTICLE II NAME AND PURPOSE OF PLAN AND DEFINITIONS

 
1. Name and effective date. The Plan set forth herein is an amendment, restatement and continuation of the State Street Corporation 401(k) Restoration and Voluntary Deferral Plan, originally established effective July 1, 1999, as subsequently amended and restated effective January 1, 2008, and renamed the State Street Corporation Management Supplemental Savings Plan. This amendment and restatement reflects changes adopted by the Committee under the First and Second Amendments to the Plan as amended and restated effective January 1, 2008. Such amendments are effective as of the dates set forth in such First and Second Amendments. The Plan is further amended to reflect certain administrative changes, clarifications, and design changes, which further modifications are effective January 1, 2014 unless otherwise provided herein. 2. Status of Plan. The Plan is intended to be “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of Sections 201(2), 301(a)(3), 401(a)(1) and 4021(b)(6) of ERISA, and shall be interpreted and administered consistent with that intent. The Plan is intended to be operated in accordance with the requirements applicable to a “nonqualified deferred compensation plan” under Code section 409A and the regulations thereunder and shall be interpreted and administered consistent with that intent. 3. Definitions. When used herein, the following words shall have the meanings indicated below. Terms not defined herein shall have the meanings assigned to them in the State Street Salary Savings Program, as from time to time amended and in effect. (a) “Account” means, for each Participant, an account established for his or her benefit under Section 3.5. All references to a Participant’s Account shall include, as the context requires, any sub-accounts that the Plan Administrator may establish. (b) “Base Pay” means, in the case of any Employee for any period, the Employee’s regular base salary or wages, including differential pay (shift deferential and differential pay paid to an Employee while on military duty or otherwise), paid in the period in question for services rendered to the Employer as an Employee. The following special rules shall apply in determining an Employee’s Base Pay: (i) Base Pay shall be determined without regard to the limitations of Section 401(a) (17) of the Code and without excluding amounts electively deferred under the Plan. (ii) Base Pay includes any such amounts that would have been received by the individual from the Employer but for an election under this Plan or under Code sections 125, 132(f) or 401(k). Amounts under Code section 125 include any amounts not available to a Participant in cash in lieu of group health coverage because the Participant is unable to certify that he or she has other health coverage. To the extent required by applicable law or IRS guidance, an amount will be treated as an amount under Code section 125 only if the Employer does not request or collect information regarding the Participant’s other health coverage as part of the enrollment process for the health plan. (iii) Base Pay excludes all other forms of compensation not listed above paid by an Employer, including but not limited to the following: all commissions and bonuses (including incentive pay), as well as supplemental wage payments, severance (however characterized), reimbursed expenses, life insurance premiums included in compensation for income tax purposes, amounts paid by an Employer to a Participant for not selecting Employer-provided medical coverage under the State Street Corporation Employee Benefit Plan, and any other items not constituting direct compensation for services. (c) “Basic Plan” means the State Street Salary Savings Program, as from time to time amended and in effect.

 
(d) “Beneficiary” means the person or persons designated by the Participant in writing, subject to such rules as the Plan Administrator may prescribe, to receive benefits under the Plan in the event of the Participant’s death. Except for purposes of Section 5.4, in the absence of an effective designation at the time of the Participant’s death the Participant’s Beneficiary shall be his or her surviving Spouse or Domestic Partner, or, if the Participant is then unmarried or has no Domestic Partner or his or her Spouse or Domestic Partner does not survive, the Participant’s estate. (e) “Committee” means the Executive Compensation Committee of the Board of Directors of State Street. (f) “Credit” means any or all, as the context requires, of an Elective Credit, a Matching Credit, or a Performance-Based Credit. (g) “Deferred Compensation Agreement” means the written (or electronic) agreement described in Section 3.1. (h) “Disabled” means, for any Participant, that the Participant, as determined in the sole discretion of the Plan Administrator: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 6 months under an accident and health plan covering employees of the Employer. (i) “Elective Credit” means an amount credited under Section 3.1. (j) “Eligible Compensation” for a Plan Year means the sum of an Employee’s Base Pay for the Plan Year plus the Employee’s Incentive Pay for the Plan Year (k) “Eligibility Date” means each December 1 or such other determination date(s) (such as the date open enrollment begins) as determined by the Plan Administrator. (l) “Eligible Employee” means an Employee who meets the eligibility criteria set forth in Section 2.1. (m) “Employee” means, except as otherwise provided by the Plan Administrator, a United States-based common-law employee of an Employer including, without limitation, such an employee while on a temporary international assignment outside of the U.S. and excluding, without limitation, a non-U.S. based employee who is temporarily residing in the U.S. while on a temporary international assignment to the U.S. (n) “Employer” means any or all, as the context requires, of State Street and any other company (or branch) that (i) would be treated as a single employer with State Street under the first sentence of Treas. Regs. §1.409A-1(h)(3), and (ii) is shown on Exhibit A as described in clause (i) and as having adopted this Plan with State Street’s approval. Only an otherwise eligible Employee of State Street or another entity listed on Exhibit A may make an election to defer compensation under the Plan or be eligible to share in Matching Credits, but in determining whether a Separation from Service has occurred, service for State Street or any other company that is described in clause (i) above shall be treated as service for the Employer. (o) “Entry Date” means each January 1. (p) “Incentive Pay” means, in the case of any Employee for any Plan Year, the Employee’s cash bonus and/or cash incentive pay (other than commissions) paid, in accordance with the Employer’s normal annual incentive bonus processing cycle, in the Plan Year under a bonus and/or incentive plan maintained by the Employer or pursuant to an agreement or

 
other arrangement with the Employer, other than (i) any such bonus or incentive pay that is automatically deferred pursuant to the terms of such bonus and/or incentive plan, agreement or arrangement and/or (ii) any such bonus or incentive pay that is determined by the Plan Administrator, in advance of the deadline for electing any deferral hereunder, to be ineligible for deferral under the Plan. The following special rules shall apply in determining an Employee’s Incentive Pay: (i) Incentive Pay shall be determined without regard to the limitations of Section 401(a)(17) of the Code and without excluding amounts electively deferred under the Plan. (ii) Incentive Pay includes any such amounts that would have been received by the individual from the Employer but for an election under this Plan or under Code sections 125, 132(f) or 401(k). Amounts under Code section 125 include any amounts not available to a Participant in cash in lieu of group health coverage because the Participant is unable to certify that he or she has other health coverage. To the extent required by applicable law or IRS guidance, an amount will be treated as an amount under Code section 125 only if the Employer does not request or collect information regarding the Participant’s other health coverage as part of the enrollment process for the health plan. (q) “Match-Eligible Compensation” means, for each Plan Year commencing on and after January 1, 2013, an amount calculated as the lesser of (i) the Employee’s Eligible Compensation, or (ii) $500,000, in either case reduced by the dollar limitation in effect with respect to the Plan Year under Code section 401(a)(17). (r) “Matching Credit” means an amount credited under Section 3.4. (s) “Participant” means an Employee who has an Account under the Plan. (t) “Plan” means this State Street Corporation Management Supplemental Savings Plan (formerly the State Street Corporation 401(k) Restoration and Voluntary Deferral Plan), as from time to time amended and in effect. (u) “Plan Administrator” means the Plan Administrator appointed pursuant to Section 6.1. (v) “Performance-Based Credit” means amounts credited under Plan during certain Plan Years prior to January 1, 2014, which amounts were determined, in part, based upon whether a performance-based contribution was made under the Basic Plan for the Plan Year. . (w) “Separation from Service” means a separation from service, within the meaning of Treas. Regs. §1.409A-1(h), with State Street and any other company that would be treated as a single employer with State Street under the first sentence of Treas. Regs. §1.409A-1(h)(3); and correlative terms shall be construed to have a corresponding meaning. To the extent permitted by the Plan Administrator, the terms “written,” “in writing,” and terms of similar import shall include communications by electronic media. ARTICLE III ARTICLE IV ELIGIBILITY AND PARTICIPATION 1. Eligibility to participate. An Employee who is an Eligible Employee on December 31, 2007 shall (subject to the last sentence of this Section 2.1) continue to be an Eligible Employee as of January 1, 2008. Any other Employee shall become an Eligible Employee on the first Eligibility Date he or she satisfies the requirements of both (a) and (b) below. For purposes of the foregoing, an Employee must: (a) have a title of Vice President or above, and (b) effective for Plan Years commencing on and after January 1, 2013, an annual rate of Base Pay which when added to Incentive Pay for a Plan Year that exceeds the dollar limitation in

 
effect with respect to the Plan Year under Code section 401(a)(17) by $10,000 or more. Notwithstanding the foregoing, a Participant who timely elected to defer Base Pay or Incentive Pay earned in 2013 shall be deemed to remain an Eligible Employee through December 31, 2013. An Eligible Employee shall remain an Eligible Employee during continuous employment by the Employer so long as he or she continues to satisfy the requirements of (a) and (b) above as of the applicable Eligibility Date for subsequent Plan Years. 2. Commencement of participation. Except as the Plan Administrator otherwise determines, any such determination to be made in a manner that is consistent with the requirements of Section 409A of the Code, and subject to the annual election process set forth in Section 3.2, an individual upon first becoming an Eligible Employee may elect to defer (a) Base Pay under Section 3.3(a) starting with Base Pay earned for the Plan Year that begins on the Entry Date next following his or her initial Eligibility Date, and (b) Incentive Pay under Section 3.3(b) starting with Incentive Pay earned for the Plan Year that begins on the Entry Date next following his or her initial Eligibility Date. 3. Termination of participation. The Plan Administrator may terminate an Employee’s participation in the Plan at any time. If an Employee’s participation in the Plan terminates hereunder, the Participant’s Account shall continue to be adjusted for notional earnings or other notional investment experience until it is distributed. No termination of participation shall result in a cessation or refund of deferrals for which the deferral election has already been made, except in a manner that is consistent with compliance with the requirements of Section 409A of the Code. ARTICLE V ARTICLE VI DEFERRED COMPENSATION AGREEMENTS, MATCHING CREDITS, performance- based credits, NOTIONAL INVESTMENT OF ACCOUNTS 1. Deferred Compensation Agreement; Elective Credits. An Eligible Employee may elect to defer a portion of his or her Base Pay and/or Incentive Pay earned during the applicable Plan Year by entering into a Deferred Compensation Agreement through the enrollment process established by the Plan Administrator for such Plan Year. An otherwise Eligible Employee who is not provided effective access to the enrollment process for a Plan Year shall be deemed ineligible to participate for such Plan Year. Elective Credits equal to the amounts deferred shall be credited to the Participant’s Account as soon as practicable after the deferral is withheld from pay. 2. Election procedures and deadlines. (a) Advance elections required. A Deferred Compensation Agreement with respect to Base Pay and/or Incentive Pay must be made in accordance with such procedures as the Plan Administrator may establish and prior to the beginning of the Plan Year in which such Base Pay and/or Incentive Pay is to be earned. . A Deferred Compensation Agreement, once made, may not be modified or revoked after the applicable election deadline except as otherwise expressly provided in Article V below. (b) Other requirements. Except as otherwise determined by the Plan Administrator, a new Deferred Compensation Agreement must be timely executed for each Plan Year and shall be effective only if offered, accepted and approved by the Plan Administrator by the applicable deadline. 3. Amount of deferrals. (a) Base Pay. For each Plan Year, an Eligible Employee may elect to defer an amount from 1% to 25% (1% to 50% effective for Plan Years commencing on or after January 1, 2013), in whole percentages, of his or her Base Pay for the Plan Year. Notwithstanding the

 
foregoing, the Plan Administrator may impose, in advance, a more restrictive minimum or maximum limit on the amount that may be deferred. (b) Incentive Pay. For each Plan Year or other applicable performance period an Eligible Employee may elect to defer an amount that is expressed either as a percentage (from 5% to 92%, in whole-percentage increments) of the Participant’s Incentive Pay for the Plan Year (or other period), or as a whole dollar amount not less than $1,000 and not exceeding 92% of such Incentive Pay. Effective for Plan Years commencing on and after January 1, 2014, for each Plan Year an Eligible Employee may elect to defer an amount that is expressed either as a percentage (from 5% to 100%, in whole-percentage increments) of the Participant’s net of FICA withholding Incentive Pay for the Plan Year (or other period), or as a whole dollar amount not less than $1,000 and not exceeding 100% of such net of FICA withholding Incentive Pay. 4. Matching Credit. For each Plan Year commencing on and after January 1, 2012, a Matching Credit shall be added to each Participant’s Account equal to the lesser of (a) 100% of the total amount, if any, deferred under all Deferred Compensation Agreements made by the Participant for such Plan Year, and (b) 5% of the Participant’s Match-Eligible Compensation for such Plan Year. Effective for Plan Years commencing on and after January 1, 2013, Matching Credits for a Plan Year shall be added to the Participant’s Account as soon as practicable following the earlier of (i) the last day of the Plan Year, or (ii) the last day of the calendar quarter following the date of the Participant’s Separation from Service or Disability.. 5. Accounts. The Plan Administrator shall establish for each Participant an Account together with such sub-accounts as in the determination of the Plan Administrator are needed or appropriate to reflect the Credits described above as well as debits and other adjustments, including without limitation adjustments for notional (hypothetical) investment experience as described in this Section 3.5. The Plan Administrator shall designate for purposes of the Plan one or more existing investment or investment-fund alternatives (each, a “tracking option”), including, if the Plan Administrator so determines, a tracking option that offers a return of notional interest (for example, as in a bank savings account), and shall give each Participant and the Beneficiary(ies) of each deceased Participant for whom an Account continues to be maintained the opportunity to allocate his or her Account among the available tracking options. Amounts allocated under the Plan to a tracking option shall be treated as though notionally invested in that tracking option. In the absence of an affirmative allocation by a Participant or Beneficiary, the Plan Administrator may designate a default tracking option and treat all or a portion of the balance of any Account, or of any amount newly credited under the Plan, as being notionally invested in the default tracking option. The Plan Administrator shall periodically adjust Accounts to reflect increases or decreases attributable to these notional investments. Except as otherwise determined by the Plan Administrator, a Participant or Beneficiary may make notional investment changes once per calendar month (daily, commencing on and after October 1, 2012). The Plan Administrator may at any time and from time to time eliminate or add tracking options or substitute a new for an existing tracking option, including with respect to balances already notionally invested under the Plan. The Employer may, but need not, purchase securities or other investments with characteristics similar to the tracking options from time to time offered under the Plan, but any such securities or other investments shall remain part of the Employer’s general assets unless held in a trust described in Section 8.1 in a manner not inconsistent with the requirements of Section 409A(b) of the Code. By selecting a tracking option hereunder, a Participant agrees, on his or her behalf and on behalf of his or her Beneficiaries, that none of the Committee, the Plan Administrator, the Employer, or any of their agents or representatives, shall be liable for any losses or damages of any kind relating to any tracking option made available hereunder.

 
6. Cancellation of Deferral Elections. A Participant’s deferral elections under Section 3.1 shall be cancelled as to future deferrals if the Participant has an unforeseeable emergency described in Section 5.4 below. Effective November 1, 2014, a Participant’s outstanding Base Pay deferral election shall be cancelled if the Participant receives a hardship distribution under the Basic Plan pursuant to §1.401(k)-1(d)(3). A Participant may also cancel his or her deferral elections as to future deferrals upon the occurrence of any medically determinable physical or mental impairment resulting in the Participant’s inability to perform the duties of his or her position or any substantially similar position, where such impairment can be expected to result in death or can be expected to last for a continuous period of not less than six months, provided such cancellation is made by the later of (a) the end of the calendar year in which such impairment occurs and (b) the 15th day of the third month following the date on which such impairment occurs. If a Participant’s deferral elections are cancelled pursuant to this Section 3.6, any later deferral election by the Participant will be subject to the timing requirements of Section 3.2. ARTICLE VII ARTICLE VIII VESTING 1. Vesting of Accounts. The portions of each Account that reflect Performance-Based Credits and Matching Credits, and related adjustments, shall be fully vested upon the Participant’s completion of one Year of Vesting Service, or upon the Participant’s death, becoming Disabled, or attainment of age 65, the termination of the Plan, the full or partial termination of the Basic Plan with respect to the Participant, whichever is first to occur. The remainder of each Account shall be fully vested at all times. The fact that an Account or any portion thereof is fully vested shall not give the Participant (or his or her Beneficiary(ies)) or any other person any right to receive the value of such Account (as the same may from time to time be adjusted) except in accordance with the terms of the Plan. ARTICLE IX ARTICLE X PLAN DISTRIBUTIONS 1. Time and form of payment: Matching Credits and Performance-Based Credits. The portions of each Account that reflect a Participant’s Matching Credits and Performance--Based Credits, and related adjustments, shall be paid in a single lump sum to the Participant on the first business day of the month following the date that is six months after the date of the Participant’s Separation from Service.. 5.2 Time and form of payment: other portions of the Account. Effective for the deferral of amounts earned on or after January 1, 2013: (a) Each Participant shall elect, not later than as part of his or her Deferred Compensation Agreement, whether the deferral of Base Pay and/or Incentive Pay accrued during the applicable Plan Year, if any, is to be paid or commence to be paid: (i) at the same time and in the same form of payment as that specified in Section 5.1 above; (ii) in annual installments over a period of from two (2) to ten (10) years commencing on the first business day of the month following the date that is six months after the date of the Participant’s Separation from Service. Each installment payment shall be determined by dividing the applicable Account balance (or remaining applicable Account balance) immediately prior to the payment date by the number of installments remaining to be paid; or (iii) in the form of a lump sum payable as of a specified date that is at least 3 years after the effective date of the applicable Deferred Compensation Agreement, provided that if the

 
Participant’s Separation from Service occurs prior to such specified date, the Participant’s benefits under the Plan shall be paid on the same date as that specified in Section 5.1 above. (b) A Participant may make a separate election each Plan Year with respect to Base Pay and Incentive Pay earned in the Plan Year that are subject to the election(s). In the absence of an affirmative election, the Participant shall be deemed to have elected payment of all subject deferrals in a single lump sum on the date specified in Section 5.1 above. (c) Subject to such additional rules and conditions as the Plan Administrator may prescribe, a Participant who has made or who is deemed to have made an election under this Section 5.2 may later change the timing of such election (or deemed election) (a “re-deferral election”) as long as the Participant remains an Employee at the time of the election, but only if all of the following additional conditions are satisfied: (i) the re-deferral election is made at least 12 months prior to the date on which payment would have otherwise been made or commenced; (ii) the re-deferral election cannot be given effect sooner than twelve (12) months after the date it becomes irrevocable; and (iii) the new payment (or payment commencement) date must follow by at least five (5) years the date on which the benefit would have been paid absent the re-deferral election. (d) For amounts earned prior to January 1, 2013 that have been deferred under the Plan, the payment of all portions of an Account payable under this Section 5.2 shall be governed by the Participant’s initial election or, if there has been a re-deferral election, the most recently effective such re-deferral election. The following information applies to amounts deferred prior to January 1, 2013, and is provided for pre-2013 deferral process historical context -- Notwithstanding the foregoing: (i) if payment is made to a Participant as of a specified date during his or her employment by the Employer, the payment terms for any Base Pay or Incentive Pay deferred from the Plan Year in which such distribution event occurred (“distribution-year deferrals”) shall be governed by a new payment election made at the time of the earliest Deferred Compensation Agreement applicable to any such distribution- year deferrals (and if there is no such new payment election, shall be deemed to have been elected to be paid in a single lump sum on the date specified in Section 5.1 above); and (ii) the payment election or deemed payment election made with respect to any distribution- year deferrals shall apply to any and all subsequent deferrals of amounts earned prior to January 1, 2013 unless the distribution-year deferral rule described in clause (v) above would apply to such subsequent deferrals. 2. (e) . 3. Special rules. (a) Payments on account of Disability. Effective for Disability determinations after October 1, 2012, if the Participant is determined to be Disabled, the balance of a Participant’s Account shall be distributed to the Participant in a single lump sum as soon as administratively feasible following the date on which the Participant becomes Disabled, and in any event by the later of A) the fifteenth day of the third month following the date on which the Participant becomes Disabled, or B) the end of the calendar year in which the Participant becomes Disabled, in a manner that complies with Code section 409A. (b) Payment upon death. As soon as practicable (and in all events within 90 days) following a Participant’s death, the Participant’s remaining Account, if any, shall be distributed in a single lump sum cash payment to the Participant’s Beneficiary or Beneficiaries.

 
(c) Rehire. Notwithstanding anything to the contrary in the Plan, in the event a Participant who has Separated from Service subsequently returns to employment with an Employer, payment of the Participant’s benefits under the Plan accrued prior to such Separation from Service shall not be suspended or otherwise delayed. 4. Unforeseeable emergency. If a Participant has a severe financial hardship resulting from an illness or accident of the Participant, his or her Federal Spouse, Beneficiary, or dependent (as defined in Code section 152(a)), a loss of property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the Participant’s control, he or she may request a withdrawal of a portion or all of his or her vested Account. No withdrawal may be made under this Section 5.4 to the extent that such emergency is or can be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets, to the extent the liquidation of such assets would not itself cause severe financial hardship. A withdrawal under this Section 5.4 will be permitted only to the extent reasonably necessary to satisfy the emergency need, which may include any amounts necessary to pay any federal, state or local income taxes or penalties reasonably anticipated to result from the withdrawal. The Plan Administrator shall have sole discretion to determine whether a withdrawal may be made under this Section 5.4 and the amount of the withdrawal that may be made. 5. Certain tax matters. Payments hereunder shall be reduced by required tax withholdings. To the extent any deferral or credit under the Plan results in current “wages” for FICA purposes, a Participant’s Employer may reduce other pay of the Participant to satisfy withholding requirements related thereto; but if there is no other pay (or if the Employer fails to withhold from such other pay to satisfy its FICA withholding obligations), the Participant’s Account shall be appropriately reduced by the amount of the required withholding. 6. Distribution of taxable amounts. Notwithstanding the foregoing, if any portion of an Account is determined by the Plan Administrator to be includible, by reason of Section 409A of the Code, in a Participant’s or Beneficiary’s income, such portion shall be paid by the Employer (or by the Employers, on an allocated basis determined by the Plan Administrator) to such Participant or Beneficiary. 7. Special Rule for 2007. Notwithstanding any provision herein to the contrary, the Plan Administrator may establish special rules and procedures to permit Participants or Beneficiaries with an Account under the Plan (as in effect prior to January 1, 2008) and whose distribution date or dates with respect to such Account would fall after December 31, 2007 to elect, in a manner consistent with transition guidance under Section 409A of the Code, a new form and time of distribution (commencing not earlier than 2008), subject to such limitations and restrictions as the Plan Administrator may impose. A Participant who fails to elect a new form and time of distribution pursuant to this Section 5.7 shall be deemed to have revoked his or her previous distribution elections with respect to benefits that have not commenced as of December 31, 2007 and to have elected for all such benefits to be paid in accordance with the other provisions of this Article V. This Section 5.7 shall be effective as of January 1, 2007. 8. Timely Payments. A payment shall be treated as made upon the date specified under the Plan provided the payment is made at such specified date or a later date within the same calendar year or, if later, by the fifteenth (15th) day of the third calendar month following the date specified under the Plan. Further, a payment is not treated as an accelerated payment if the payment is made no earlier than 30 days before the date specified under the Plan. Notwithstanding the above, neither a Participant nor Beneficiary shall have any influence over the tax year in which a payment falls. ARTICLE VI

 
ADMINISTRATION OF THE PLAN 6.1 Plan Administrator. Except as the Committee may otherwise determine, the Plan Administrator shall be the Executive Vice President-Global Human Resources as from time to time in office, and his or her delegates. The Plan Administrator shall have complete discretionary authority to interpret the Plan and to decide all matters under the Plan. Such interpretation and decision shall be final, conclusive and binding on all Participants and any person claiming under or through any Participant, in the absence of clear and convincing evidence that the Plan Administrator acted arbitrarily and capriciously. However, no individual acting, directly or by delegation, as the Plan Administrator may determine his or her own rights or entitlements under the Plan. The Plan Administrator shall establish such rules and procedures, maintain such records and prepare such reports as it considers to be necessary or appropriate to carry out the purposes of the Plan. 6.2 Outside services. The Plan Administrator may engage counsel and such clerical, financial, investment, accounting, and other specialized services as the Plan Administrator may deem necessary or appropriate in the administration of the Plan. The Plan Administrator shall be entitled to rely upon any opinions, reports, or other advice furnished by counsel or other specialists engaged for that purpose and, in so relying, shall be fully protected in any action, determination, or omission made in good faith. 6.3 Indemnification. To the extent permitted by law and not prohibited by its charter and by-laws, State Street will indemnify and hold harmless every person serving (directly or by delegation) as Plan Administrator and the estate of such an individual if he or she is deceased from and against all claims, loss, damages, liability and reasonable costs and expenses incurred in carrying out his or her responsibilities as Plan Administrator, unless due to the gross negligence, bad faith or willful misconduct of such individual; provided, that counsel fees and amounts paid in settlement must be approved by State Street; and further provided, that this Section 6.3 will not apply to any claims, loss, damages, liability or costs and expenses which are covered by a liability insurance policy maintained by State Street or by the individual. The provisions of the preceding sentence shall not apply to any corporate trustee, insurance company, investment manager or outside service provider (or to any employee of any of the foregoing) unless State Street otherwise specifies in writing. 6.4 Claims procedure. The Plan Administrator has established the procedures set forth on Exhibit B for determining claims for benefits under the Plan. The Plan Administrator may modify or update Exhibit B from time to time without any amendment under Section 7.1 being required. ARTICLE XI ARTICLE XII AMENDMENT AND TERMINATION 1. Amendment; termination. By action of the Committee or its delegate, State Street reserves the absolute right at any time and from time to time to amend any or all provisions of the Plan, and to terminate the Plan at any time. In addition, the Plan Administrator shall have the right at any time and from time to time to make amendments to the Plan (in general or with respect to one or more individual Participants or Beneficiaries) that are administrative in nature and that do not materially increase the financial obligations of the Employer, including, without limitation, amendments coordinating the provisions of the Plan with the terms of any severance, separation or similar plan or agreement. 2. Effect of amendment or termination. No action under Section 7.1 shall operate to reduce the balance of a Participant’s Account as compared to such balance immediately prior to the effectiveness of such action, other than through a distribution upon a termination and liquidation of the Plan in accordance with the requirements of Treas. Regs. §1.409A-3(j)(4)(ix)). ARTICLE XIII

 
ARTICLE XIV MISCELLANEOUS PROVISIONS 1. Source of payments. All payments hereunder to Participants and their Beneficiaries shall be paid from the general assets of the Employer, including for this purpose, if the Employer in its sole discretion so determines, assets of one or more trusts established to assist in the payment of benefits hereunder. Any trust established pursuant to the preceding sentence shall provide that trust assets remain subject to the employer’s general creditors in the event of insolvency or bankruptcy and shall otherwise contain such terms as are necessary to ensure that they do not constitute a “funding” of the Plan for purposes of the Code or ERISA. 2. Other arrangements made subject to the Plan. The Plan Administrator in its discretion may provide that other deferrals of compensation by persons providing services to an Employer shall be governed in whole or in part by the provisions of the Plan. In any case where an Employer has agreed to assume a deferred compensation obligation of another employer (for example, but without limitation, in connection with the transfer of employment of an individual from such other employer to the Employer assuming such deferred compensation obligations), the Plan Administrator may likewise provide that such assumed obligation, expressed as an account, shall be governed in whole or in part by the provisions of the Plan. 3. No warranties. Neither the Plan Administrator nor any Employer warrants or represents in any way that the value of a Participant’s Account will increase or not decrease. Each Participant (and his or her Beneficiary) assumes all risk in connection with any change in such value. 4. Inalienability of benefits. Except as required by law, no benefit under, or interest in, the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt to do so shall be void. 5. Reclassification of Employment Status. Notwithstanding anything herein to the contrary, an individual who is not characterized or treated as a common law employee by an Employer shall not be eligible to participate in the Plan notwithstanding any determination of employee status by the Internal Revenue Service, a court of competent jurisdiction or otherwise. At the time when any individual is reclassified or deemed to be reclassified as a common law employee, the individual shall be eligible to participate in the Plan as of the Entry Date coinciding with or next following the reclassification date (to the extent such individual otherwise qualifies as an Eligible Employee hereunder). If the effective date of any such reclassification is prior to the actual date of such reclassification, in no event shall the reclassified individual be eligible to participate in the Plan retroactively to the effective date of such reclassification. 6. Expenses. The Employer shall pay all costs and expenses incurred in operating and administering the Plan. 7. No right of employment. Nothing contained herein, nor any action taken under the provisions hereof, shall be construed as giving any Participant the right to be retained in the employ of an Employer. 8. Headings. The headings of the sections in the Plan are placed herein for convenience of reference, and, in the case of any conflict, the text of the Plan, rather than such heading, shall control. 9. Acceptance of Plan terms. By executing a Deferred Compensation Agreement, a Participant agrees, on his or her behalf and on behalf of his or her Beneficiaries, to abide by the terms of the Plan and the determinations of the Plan Administrator with respect thereto. 10. Construction. The Plan shall be construed, regulated, and administered in accordance with the laws of the Commonwealth of Massachusetts and applicable federal laws. IN WITNESS WHEREOF, the Employer has caused this instrument to be executed by its duly respective duly authorized officer on the 15 day of September, 2014.

 
STATE STREET CORPORATION By: __/s/ Alison A. Quirk_____ Alison A. Quirk Executive Vice President EXHIBIT A LIST OF EMPLOYERS (as of December 31, 2013) Currenex, Inc. Elkins/McSherry, LLC International Fund Services (N.A.), L.L.C. Investment Management Services, Inc. Investors California LLC State Street Fund Services (U.S.) LLC (f.k.a. Palmeri Fund Administrators, Inc.) State Street Fund Services (f.k.a. Palmeri Fund Administrators, Inc.) Princeton Financial Systems, Inc. State Street Bank & Trust Co. (U.S. branch) State Street Bank & Trust Co. N.A. State Street Bank & Trust Co. of CA. State Street Bank & Trust Co. of NH State Street Financial Services, Inc. State Street Global Advisors Capital Management Trust Company State Street Mass. Securities Corp. State Street Mutual Fund Service Company, LLC State Street Investment Management Solutions, LLC State Street Public Lending Corp. (effective September 1, 2014) 04-2981072 State Street Boston Leasing Co., Inc. 04-2488283 EXHIBIT B CLAIMS PROCEDURES STATE STREET CORPORATION DEFERRED COMPENSATION PLAN CLAIMS PROCEDURES (Amended and Restated Effective January 1, 2014) These Claims Procedures for filing and reviewing claims have been established and adopted for the State Street Corporation Management Supplemental Savings Plan, and the State Street Corporation Management Supplemental Retirement Plan (each, a “Plan,” and together, the “Plans”) and are intended to comply with Section 503 of ERISA and related Department of Labor regulations. These amended and restated Claims Procedures are effective for claims made under the Plans on or after January 1, 2008. 1. In General. Any employee or former employee, or any person claiming to be a beneficiary with respect to such a person, may request, with respect to any of the Plans: a) a benefit payment, b) a resolution of a disputed amount of benefit payment, or c) a resolution of a dispute as to whether the person is entitled to the particular form of benefit payment.

 
A request described above and filed in accordance with these Procedures is a claim, and the person on whose behalf the claim is filed is a claimant. A claim must relate to a benefit which the claimant asserts he or she is already entitled to receive or will become entitled to receive within one year following the date the claim is filed. 2. Effect on Benefit Requests in Due Course. Each Plan has established procedures for benefit applications, selection of benefit forms, designation of beneficiaries, determination of qualified domestic relations orders, and similar routine requests and inquiries relating to the operation of the Plan. 3. Filing of Claims. a) Each claim must be in writing and delivered by hand or first-class mail (including registered or certified mail) to the Plan Administrator, at the following address: GHR U.S. Benefits Planning State Street Corporation c/o Vice President, GHR-U.S. Benefits Planning One Lincoln Street, 14th Floor Boston, MA 02111 A claim must clearly state the specific outcome being sought by the claimant. b) The claim must also include sufficient information relating to the identity of the claimant and such other information reasonably necessary to allow the claim to be evaluated. c) In no event may a claim for benefits be filed by a Claimant more than 120 days after the applicable “Notice Date,” as defined below. i) In any case where benefits are paid to the Claimant as a lump sum, the Notice Date shall be the date of payment of the lump sum. ii) In any case where benefits are paid to the Claimant in the form of an annuity or installments, the Notice Date shall be the date of payment of the first installment of the annuity or payment of first installment. iii) In any case where the Plan (prior to the filing of a claim for benefits) determines that an individual is not entitled to benefits (for example (without limitation) where an individual terminates employment and the Plan determines that he has not vested) and the Plan provides written notice to such person of its determination, the Notice Date shall be the date of the individual’s receipt of such notice. iv) In any case where the Plan provides an individual with a written statement of his account as of a specific date or the amounts credit to, or charged against, his account within a specified period, the Notice Date with regard to matters describe in such statement shall be the date of the receipt of such notice by such individual (or beneficiary). 4. Processing of Claims. A claim normally shall be processed and determined by the Plan Administrator within a reasonable time (not longer than 90 days) following actual receipt of the claim. However, if the Plan Administrator determines that additional time is needed to process the claim and so notifies the claimant in writing within the initial 90-day period, the Plan Administrator may extend the determination period for up to an additional 90 days. In addition, where the Plan Administrator determines that the extension of time is required due to the failure of the claimant to submit information necessary in order to determine the claim, the period of time in which the claim is required to be considered pursuant to this Paragraph 4 shall be tolled from the date on which notification of the extension is sent to the claimant until the date on which the claimant responds to the request for additional information. Any notice to a claimant extending the period for considering a claim shall indicate the circumstances requiring the extension and the date by which the Plan Administrator expects to render a

 
determination with respect to the claim. The Plan Administrator shall not process or adjudicate any claim relating specifically to his or her own benefits under a Plan. 5. Determination of Claim. The Plan Administrator shall inform the claimant in writing of the decision regarding the claim by registered or certified mail posted within the time period described in Paragraph 4. The decision shall be based on governing Plan documents. If there is an adverse determination with respect to all or part of the claim, the written notice shall include: a) the specific reason or reasons for the denial, b) reference to the specific Plan provisions on which the denial is based, c) a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary, d) reference to and a copy of these Procedures, so as to provide the claimant with a description of the relevant Plan’s review procedures and the time limits applicable to such procedures, a description of the claimant’s rights regarding documentation as described in Paragraph 9, and e) a statement of the claimant’s rights under Section 502(a) of ERISA to bring a civil action with respect to an adverse determination upon review of an appeal filed under Paragraph 6. For purposes of these Procedures, an adverse determination shall mean determination of a claim resulting in a denial, reduction, or termination of a benefit under a Plan, or the failure to provide or make payment (in whole or in part) of a benefit or any form of benefit under a Plan. Adverse determinations shall include denials, reductions, etc. based on the claimant’s lack of eligibility to participate in the relevant Plan. All decisions made by the Plan Administrator under these Procedures shall be summarized in a report to be maintained in the files of the Plan Administrator. The report shall include reference to the applicable governing Plan provision(s) and, where applicable, reference to prior determinations of claims involving similarly situated claimants. 6. Appeal of Claim Denials - Appeals Committee. A claimant who has received an adverse determination of all or part of a claim shall have 60 days from the date of such receipt to contest the denial by filing an appeal. An appeal must be in writing and delivered to the Plan Administrator. An appeal will be considered timely only if actually received by the Plan Administrator within the 60-day period or, if sent by mail, postmarked within the 60-day period. The timely review will be completed by the Appeals Committee and should be sent to: Appeals Committee State Street Corporation c/o Vice President, GHR-U.S. Benefits Planning One Lincoln Street, 14th Floor Boston, MA 02111 The Appeals Committee shall meet at such times and places as it considers appropriate, shall keep a record of such meetings and shall periodically report its deliberations to the Plan Administrator. Such reports shall include the basis upon which the appeal was determined and, where applicable, reference to prior determinations of claims involving similarly situated claimants. The vote of a majority of the members of the Appeals Committee shall decide any question brought before the Appeals Committee. 7. Consideration of Appeals. The Appeals Committee shall make an independent decision as to the claim based on a full and fair review of the record. The Appeals Committee shall take into account in its deliberations all comments, documents, records and other information submitted by the claimant, whether submitted in connection with the appeal or in connection with the original claim, and may, but need not, hold a hearing in connection with its consideration of the appeal. The Appeals Committee shall consider an appeal within a reasonable period of time, but not later

 
than 60 days after receipt of the appeal, unless the Appeals Committee determines that special circumstances (such as the need to hold a hearing) require an extension of time. If the Appeals Committee determines that an extension of time is required, it will cause written notice of the extension, including a description of the circumstances requiring an extension and the date by which the Appeals Committee expects to render the determination on review, to be furnished to the claimant before the end of the initial 60-day period. In no event shall an extension exceed a period of 60 days from the end of the initial period; provided, that in the case of any extension of time required by the failure of the claimant to submit information necessary for the Appeals Committee to consider the appeal, the period of time in which the appeal is required to be considered under this Paragraph 7 shall be tolled from the date on which notification of the extension is sent to the claimant until the date on which the claimant responds to the Appeals Committee’s request for additional information. 8. Resolution of Appeal. Notice of the Appeals Committee’s determination with respect to an appeal shall be communicated to the claimant in writing by registered or certified mail posted within the time period described in Paragraph 7. If the determination is adverse, such notice shall include: a) the specific reason or reasons for the adverse determination, b) reference to the specific plan provisions on which the adverse determination was based, c) reference to and a copy of these Procedures, so as to provide the claimant with a description of the claimant’s rights regarding documentation as described in Paragraph 9, and d) a statement of the claimant’s rights under Section 502(a) of ERISA to bring a civil action with respect to the adverse determination. 9. Certain Information. In connection with the determination of a claim or appeal, a claimant may submit written comments, documents, records and other information relating to the claim and may request (in writing) copies of any documents, records and other information relevant to the claim. An item shall be deemed relevant to a claim if it: a) was relied on in determining the claim, b) was submitted, considered or generated in the course of making such determination (whether or not actually relied on), or c) demonstrates that such determination was made in accordance with governing Plan documents (including, for this purpose, these Procedures) and that, where appropriate, Plan provisions have been applied consistently with similarly situated claimants. The Plan Administrator shall furnish free of charge copies of all relevant documents, records and other information so requested; provided, that nothing in these Procedures shall obligate State Street Corporation ("State Street"), the Plan Administrator, or any person or committee to disclose any document, record or information that is subject to a privilege (including, without limitation, the attorney- client privilege) or the disclosure of which would, in the Plan Administrator’s judgment, violate any law or regulation. 10. Rights of a Claimant Where Appeal is Denied. a) The claimant’s actual entitlement, if any, to bring suit and the scope of and other rules pertaining to any such suit shall be governed by, and subject to the limitations of, applicable law, including ERISA. By extending to an employee or former employee the right to file a claim under these Procedures, neither State Street nor any person or committee appointed as Plan Administrator acknowledges or concedes that such individual is a participant in any particular Plan within the meaning of such Plan or ERISA, and reserves the right to assert that an individual is not a participant in any action brought under Section 502(a).

 
b) In no event may any legal proceeding regarding entitlement to benefits or any aspect of benefits under the Plan be commenced later than the earliest of i) two years after the applicable Notice Date; or ii) one year after the date a claimant receives a decision from the Appeals Committee regarding his appeal, or iii) the date otherwise prescribed by applicable law. c) Before any legal proceeding can be brought, a participant must exhaust the claim appeals procedures as set forth herein. 11. Special Rules Regarding Disability. Certain benefits under the Plans are contingent upon an individual’s incurring a disability. Where a claim requires a determination by State Street as to whether an individual is “disabled” as defined under the Plan, the additional rules set forth in Schedule 1 to these Procedures shall apply to the claim. However, where disabled status is based upon actual entitlement to benefits under a separate plan in which the individual participates or is otherwise covered, the determination of such status for purposes of each Plan shall be made under such separate disability plan, and any claims or disputes as to disabled status under such plan or program shall be resolved in accordance with the procedures established for that purpose under the separate plan or program. 12. Authorized Representation. A claimant may authorize an individual to represent him/her with respect to a claim or appeal made under these Procedures. Any such authorization shall be in writing, shall clearly identify the name and address of the individual, and shall be delivered to the Plan Administrator at the address listed in Paragraph 3. On receipt of a letter of authorization, all parties authorized to act under these Procedures shall be entitled to rely on such authorization, until similarly revoked by the claimant. While an authorization is in effect, all notices and communications to be provided to the claimant under these Procedures shall also be provided to his/her authorized representative. 13. Form of Communications. Unless otherwise specified above, any claim, appeal, notice, determination, request, or other communication made under these Procedures shall be in writing, with original signed copy delivered by hand or first class mail (including registered or certified mail). A copy or advance delivery of any such claim, appeal, notice, determination, request, or other communication may be made by electronic mail or facsimile. Any such electronic or facsimile communication, however, shall be for the convenience of the parties only and not in substitution of a writing required to be mailed or delivered under these Procedures, and receipt or delivery of any such claim, appeal, notice, determination, request, or other written communication shall not be considered to have been made until the actual posting or receipt of original signed copy, as the case may be. 14. Reliance on Outside Counsel, Consultants, etc. The Plan Administrator and the Appeals Committee may rely on or take into account advice or information provided by such legal, accounting, actuarial, consulting or other professionals as may be selected in determining a claim or appeal, including those individuals and firms that may render advice to State Street or the Plans from time to time. 15. Amendment of Procedures - Interpretation. These Procedures may be modified at any time and from time to time by written action of the Plan Administrator and shall be deemed automatically modified to incorporate any requirement attributable to a change in the applicable Department of Labor regulations after the date hereof. The Plan Administrator shall have complete discretion to interpret and apply these Procedures, including, for purposes of applying these Procedures, such regulations. Further, nothing in these Procedures shall be construed to limit the discretion of the Plan Administrator or its designee to interpret the Plans or, subject to the right of appeal of an adverse determination, the finality of the decision of the Plan Administrator or its designee, all as set forth in the Plans. Schedule 1 Special Rules Regarding Certain Disability Claims

 
Pursuant to Paragraph 11 in the Claims Procedures, the following special rules supplement the Claims Procedures and apply only in the case of a claim (“Disability Claim”) which requires a determination by State Street as to whether an individual is “disabled” as defined under the Plan. Time to Process Claims. The Plan Administrator will process and inform the claimant of the determination of the Disability Claim in accordance with Paragraphs 4 and 5 of the Claims Procedures, except that a period of 45 days shall apply instead of the initial 90 days in which to process and determine the Disability Claim. This period may be extended initially by the Plan Administrator for 30 days if the claimant is notified before the end of the original 45-day period that the extension is necessary due to matters beyond the control of the Plan Administrator. This 30-day extension period may be extended by the Plan Administrator for an additional 30 days if the claimant is notified before the end of the first 30- day extension that the extension is necessary due to circumstances beyond the control of the Plan Administrator. Any notice of an extension will explain the reason for the extension, when the Plan Administrator expects to rule on the Disability Claim, the standards on which entitlement to a benefit is based, the unresolved issues that prevent a decision on the Disability Claim, and any additional information needed to resolve those issues. If the claimant is informed that he/she needs to provide additional information necessary to resolve Disability Claim issues, the claimant will have 45 days from the date he/she receives the extension notice to provide the additional information. Determination of Claim and Notice of Determination. If disabled status is based on eligibility for benefits under a long-term disability plan maintained by State Street, the Plan Administrator will determine which long-term disability plan is the applicable plan for the claimant, and whether the claimant would be certified as disabled under such long-term disability plan by applying the standards and definitions used in the long-term disability plan. The Plan Administrator may require and rely on the written report or certification from a licensed physician selected or approved by the Plan Administrator. In addition to the requirements of Paragraph 5 in the Claims Procedures, any written notice of an adverse determination of a Disability Claim will include a copy of any internal rules, guidelines, protocols, or other similar criteria that were relied on in the decision-making, or a statement that the determination was based on the applicable items mentioned above, and that copies of the applicable items will be provided, free of charge, on the claimant’s request. In addition, if the adverse determination is based on a medical necessity, experimental treatment or similar exclusion or limit, the notice will contain an explanation of the scientific or clinical judgment used in the determination, applying the terms of the relevant long-term disability plan to the claimant’s medical circumstances, or a statement that such explanation will be provided, free of charge, upon the claimant’s request. Appeal of a Claim Denial. Notwithstanding Paragraph 6 of the Claims Procedures, a claimant who has received an adverse determination of all or part of a Disability Claim shall have 180 days from the date of receipt to appeal the denial (“Disability Appeal”). Notwithstanding Paragraph 7 of the Claims Procedures, review of a Disability Appeal will be conducted by the Appeals Committee without deference to the initial adverse benefit determination by the Plan Administrator, and no member of the Appeals Committee will participate in the review of a Disability Claim if such member made the adverse benefit determination that is the subject of the Disability Appeal or is the subordinate of the person who made such determinations. If the adverse determination was based in whole or in part on a medical judgment, including determinations with regard to whether a particular treatment, drug, or other item is experimental, investigational, or not medically necessary or appropriate, the Appeals Committee shall consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment and who was not consulted in connection with the initial claim denial (and who is not the subordinate of any such person). Any medical or vocational experts whose advice was obtained

 
will be identified, without regard to whether the advice was relied upon in making the benefit determination. Notwithstanding Paragraphs 7 and 8 of the Claims Procedures, the Appeals Committee shall consider and communicate its determination with respect to a Disability Appeal within a reasonable time, but not later than 45 days after receipt of the Disability Appeal, unless special circumstances require an extension for processing, in which case a decision will be made within a 45-day extension period. Resolution of Appeal. In addition to the information required by Paragraph 8 of the Claims Procedures, any written notice by the Appeals Committee of an adverse determination on a Disability Appeal will include a description of any specific internal rules, guidelines, protocols, or other similar criteria that were relied on in making the decision, or a statement that the decision was based on the applicable items mentioned above, and copies of the applicable items will be provided, free of charge, upon the claimant’s request. In addition, if the adverse determination of the Disability Appeal is based on a medical necessity, experimental treatment or similar exclusion or limit, the notice will contain an explanation of the scientific or clinical judgment used in the determination, applying the terms of the relevant long-term disability plan to the claimant’s medical circumstances, or a statement that such explanation will be provided, free of charge, at the claimant’s request. FIRST AMENDMENT TO THE STATE STREET CORPORATION MANAGEMENT SUPPLEMENTAL SAVINGS PLAN Pursuant to the provisions of Section 7.1 of the State Street Corporation Management Supplemental Savings Plan, Amended and Restated Effective as of January 1, 2014 (“the Plan”), State Street Corporation as plan sponsor hereby amends the Plan effective October 1, 2016 as follows: 1. Effective for Plan eligibility determinations made on or after October 1, 2016 subsection 1.3(k) is replaced in its entirety as follows: “(k) “Eligible Compensation” for a Plan Year means the sum of an Employee’s Base Pay paid in the Plan Year plus the Employee’s Incentive Pay paid in the Plan Year, or such other reasonable proxy amount(s) determined by the Plan Administrator in the event of a corporate transaction that contemplates subject employee eligibility during the Plan Year.” IN WITNESS WHEREOF, State Street Corporation has caused this instrument to be executed by its duly authorized officer this 21st day of November, 2016. STATE STREET CORPORATION By: /s/ Alison Quirk Name: Alison Quirk Title: Executive Vice President, Global Human Resources

 
Amendments to the: State Street Corporation Employee Benefit Plan State Street Corporation Flexible Benefit Plan State Street Corporation Medical Reimbursement Program State Street Corporation Dependent Care Plan State Street Corporation Adoption Assistance Plan State Street Corporation Severance Plan State Street Salary Savings Program State Street Retirement Plan State Street Corporation Management Supplemental Savings Plan Other State Street Benefits Programs Approved: Effective as of December 26, 2016, or such other date specified by an officer of State Street Corporation, the State Street Global Advisor Trust Company (SSGA) shall become a participating employer in each of the State Street benefit plans/programs available to active State Street employees for purposes of SSGA employee eligibility to participate (or continued participation) in such plans/programs, including, but not limited to the, State Street Corporation Employee Benefit Plan, State Street Corporation Flexible Benefit Plan, State Street Corporation Medical Reimbursement Program, State Street Corporation Dependent Care Plan, State Street Corporation Adoption Assistance Plan, State Street Corporation Severance Plan, State Street Salary Savings Program, State Street Retirement Plan (for limited applicable purposes given the plan is frozen) and State Street Corporation Management Supplemental Savings Plan; and it is intended that any transferring employees from other State Street organizations to SSGA shall have continued and uninterrupted coverage under applicable plans/programs based upon outstanding elections at the time of transfer, consistent with otherwise applicable plan/program terms and applicable law. And that the officers of State Street Corporation, the Managing Director, Global Human Resources - Head of Global Benefits, and members of the State Street North America Regional Benefits Committee are individually and severally authorized to take such actions and execute such documents that are deemed necessary in furtherance of the approved to add SSGA as a participating employer in the State Street benefit plans/programs, such actions or execution being conclusive evidence of having been approved and adopted. IN WITNESS WHEREOF, State Street Corporation has caused this instrument to be executed by its duly authorized officer this 21st day of December, 2016. STATE STREET CORPORATION By: /s/ Alison A. Quirk Alison A. Quirk Executive Vice President

 
Amendments to the: State Street Corporation Employee Benefit Plan State Street Corporation Flexible Benefit Plan State Street Corporation Medical Reimbursement Program State Street Corporation Adoption Assistance Plan State Street Corporation Severance Plan State Street Salary Savings Program State Street Corporation Management Supplemental Savings Plan Other State Street Benefits Programs Approved: Effective as of January 1, 2019, or such other date specified by an officer of State Street Corporation, the Charles River Systems, Inc. (also known as Charles River Development or “CRD”) shall become a participating employer in each of the State Street benefit plans/programs available to active State Street employees for purposes of CRD employee eligibility to participate (or continued participation) in such plans/programs, including, but not limited to the, State Street Corporation Employee Benefit Plan, State Street Corporation Flexible Benefit Plan, State Street Corporation Medical Reimbursement Program, State Street Corporation Adoption Assistance Plan, State Street Corporation Severance Plan, State Street Salary Savings Program and State Street Corporation Management Supplemental Savings Plan; and it is intended that any transferring employees from other State Street organizations to CRD shall have continued and uninterrupted coverage under applicable plans/programs based upon outstanding elections at the time of transfer, consistent with otherwise applicable plan/program terms and applicable law. And that the officers of State Street Corporation, the Vice President, Global Human Resources - Head of Global Benefits, SVP, Global Head of Total Rewards and members of the State Street U.S. Benefits Committee are individually and severally authorized to take such actions and execute such documents that are deemed necessary in furtherance of the approved to add CRD as a participating employer in the State Street benefit plans/programs, such actions or execution being conclusive evidence of having been approved and adopted. IN WITNESS WHEREOF, State Street Corporation has caused this instrument to be executed by its duly authorized officer. STATE STREET CORPORATION By: /s/ Kathryn M. Horgan Kathryn M. Horgan Executive Vice President December 18, 2018

 


Exhibit 15

Acknowledgment Letter of Ernst & Young LLP, Independent Registered Public Accounting Firm

May 1, 2019

The Shareholders and Board of Directors of
State Street Corporation

We are aware of the incorporation by reference in the Registration Statements (Form S-3 No. 333-221293, and Form S-8 Nos. 333-100001, 333-99989, 333-46678, 333-36793, 333-36409, 333-135696, 333-160171, 333-183656 and 333-218048) of State Street Corporation of our report dated May 1, 2019 relating to the unaudited condensed consolidated interim financial statements of State Street Corporation that are included in its Form 10-Q for the quarter ended March 31, 2019.

Under Rule 436(c) of the 1933 Act, our report is not part of the registration statements prepared or certified by accountants within the meaning of Section 7 or 11 of the 1933 Act.

                                        
/s/ Ernst & Young LLP
Boston, Massachusetts





Exhibit 18.1 May 1, 2019 Board of Directors State Street Corporation 1 Lincoln Street Boston, MA 02111 Ladies and Gentlemen: Note 1 of the Notes to the consolidated financial statements of State Street Corporation included in its Form 10-Q for the three months ended March 31, 2019, describes a change in the method of accounting for investments in low income housing tax credits investments from the equity method of accounting to the proportional amortization method of accounting. There are no authoritative criteria for determining a ‘preferable’ method of accounting for low income housing tax credit investments based on the particular circumstances; however, we conclude that such change in the method of accounting is to an acceptable alternative method which, based on your business judgment to make this change and for the stated reason, is preferable in your circumstances. We have not conducted an audit in accordance with the standards of the Public Company Accounting Oversight Board (United States) of any financial statements of the Company as of any date or for any period subsequent to December 31, 2018, and therefore we do not express any opinion on any financial statements of State Street Corporation subsequent to that date. Very truly yours, /s/ Ernst & Young LLP Boston, Massachusetts

 


EXHIBIT 31.1
RULE 13a-14(a)/15d-14(a) CERTIFICATION
I, Ronald P. O'Hanley, certify that:
1.
I have reviewed this Quarterly Report on Form 10-Q of State Street Corporation;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present, in all material respects, the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date:
May 1, 2019
 
By:
/s/ RONALD P. O'HANLEY      
 
 
 
 
Ronald P. O'Hanley,
 
 
 
 
President and Chief Executive Officer





EXHIBIT 31.2
RULE 13a-14(a)/15d-14(a) CERTIFICATION
I, Eric W. Aboaf, certify that:
1.
I have reviewed this Quarterly Report on Form 10-Q of State Street Corporation;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present, in all material respects, the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
 
Date:
May 1, 2019
 
By:
/s/  ERIC W. ABOAF        
 
 
 
 
Eric W. Aboaf,
 
 
 
 
Executive Vice President and Chief Financial Officer
 





EXHIBIT 32
SECTION 1350 CERTIFICATIONS
To my knowledge, this Report on Form 10-Q for the period ended March 31, 2019 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of State Street Corporation.
 
 
 
 
 
 
Date:
May 1, 2019
 
By:
/s/  RONALD P. O'HANLEY
 
 
 
 
Ronald P. O'Hanley,
 
 
 
 
President and Chief Executive Officer
 
 
 
 
 
Date:
May 1, 2019
 
By:
/s/  ERIC W. ABOAF        
 
 
 
 
Eric W. Aboaf,
 
 
 
 
Executive Vice President and Chief Financial Officer