(Reuters) - Custodian bank State Street Corp (STT.N) said on Friday it expects fourth-quarter servicing fee revenue - its main earnings driver - to remain flat compared with the third quarter, sending its shares down 10 percent.
The company reported a third-quarter profit on Friday that missed estimates for the first time in two years, mainly due to a drop in servicing fee revenue.
State Street makes most of its money from managing assets for retail investors, big banks and hedge funds. It also provides wealth and estate-management services to high net worth clients.
The company said its total expenses rose 3 percent to $2.08 billion the third quarter, mostly due to investments to support new client business.
Expenses are expected to rise slightly in the fourth quarter from the third quarter, the company said in a post-earnings call with analysts.
State Street shares fell to $71.80, their lowest in nearly two years.
Reporting By Aparajita Saxena in Bengaluru