5/16/2000

It was the year State Street got out of the banking business. The euro was born, replacing 11 European currencies and presenting global securities-handling firms such as State Street with a vast systems-overhaul project - and a kind of dry run for Y2K.

Marshall Carter has been at the helm of State Street Corp. for eight years. (Globe File Photo) 1. Eaton Vance Corp. 2. Analog Devices 3. RSA Security Inc. 4. EMC Corp. 5. Brooktrout Inc. 6. Biogen Inc. 7. Staples Inc. 8. Affiliated Managers 9. Millipore Corp. 10. State Street Corp. The 2000 Globe 100

All those distractions aside, the Boston investment management and financial services giant stayed on track and grew operating revenues by 13 percent to $3.12 billion. Operating earnings rose 12 percent, to $489 million, or $2.99 per share.

In its 22d consecutive year of double-digit earnings growth, State Street ranked number ten on The Globe 100 and was the 38th-fastest-growing public company in the commonwealth.

''We're not seeing any slowdown at all,'' State Street chief executive Marshall Carter said. He attributed the strong year to a young and talented work force and to ''our constant focus on strategic direction.''

State Street sold its 208-year-old commercial bank to Citizens Financial Group in May 1999, in a bid to focus on its core investment and custody businesses. The company's biggest source of earnings is in handling record keeping and accounting on $6.2 trillion worth of assets in mutual funds, pensions, and other client portfolios. It also manages $720 billion worth of investments, mainly in index funds.

Carter said the company is looking to exploit the Internet more. It also aims to boost foreign revenues to 35 percent of its total.

State Street managed to defy some Wall Street naysayers last year, who suggested its growth would soon slow. Those doubts slashed 40 percent of the value from State Street shares between April and September of 1999.

The stock gained just 4 percent last year as a result, but it has since made a huge comeback, jumping 43 percent to eclipse $106 per share. Not everyone thinks the party can continue at this pace: Only five of 14 analysts tracked by Nelson's rate the stock a ''buy.'' The rest are neutral or slightly positive.

State Street had 17,213 employees worldwide at year-end. Carter's goal is to grow revenues by 12.5 percent a year through 2010.

BETH HEALY