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  "documentTitle": "State Street Corporation (STT)",
  "authorId": "06_Trian_Partners",
  "authorName": "Trian Partners",
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  "presentationDate": "2011-10-16 00:00:00",
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  "notes": "Includes specific quantitative estimates for excess capital per share and annual capital generation.",
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      "kind": "callout",
      "text": "At the current valuation, Trian believes that management must prioritize returning capital to shareholders over M&A and should clearly signal this to the market",
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      "text": "Today, State Street trades at a depressed multiple of 8.0x 2011 EPS(1) despite trough margin levels – well below intrinsic value in our view",
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      "text": "We believe State Street should target returning the vast majority of capital in excess of its regulatory requirements to shareholders. While this is not immediately possible in today’s regulatory environment, we believe that the lack of guidance leaves open the possibility that this capital will continue to build and be earmarked for dilutive M&A",
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      "text": "At State Street's 11.8% tier 1 common ratio, it has between $4.50 and $7.50 of excess capital per share (13%-22% of its market capitalization), assuming its capital requirements are between 8.0% and 9.5%. Furthermore the company is generating over $4.00 per share of capital annually (net income + intangible amortization) equating to approximately a 12% yield",
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      "text": "State Street has spent significant capital on M&A, restructurings, capital expenditures and balance sheet repairs in recent years, many of which have diminished shareholder value",
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      "text": "excess capital per share: $4.50 - $7.50",
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      "text": "(1) Represents 2011 consensus estimates. Note State Street’s P/E ratio is adjusted for $4.50 of excess capital above a Basel III ratio of 9.5%.",
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      "text": "2. Prioritize Returning Capital to Shareholders Over M&A",
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