State Street Boston Corp. has won a contract to administer a retirement savings plan that a major California pension plan is introducing to its members.
The contract with the California State Teachers' Retirement System, which has 450,000 members, marks State Street's second big win in the public-sector retirement savings plan niche - a segment of the market it began pursuing last year.
Building on the computers, software, and staff it uses to administer 401(k) retirement savings plans for private companies, State Street is seeking to provide administration services to defined-contribution plans for state and local governments.
In so doing, the Boston-based banking company is aiming to leverage its position as a leading custodian for public pension plans.
State Street obtained its first success with the new defined- contribution push last year, when the California Public Employee Retirement System selected it to administer and manage investment portfolios for a defined-contribution retirement plan the group is beginning to market to its members.
Both of the California pension plans are offering defined-contribution plans to help members supplement retirement income they will get from pensions.
The contract with California State Teachers is similar to the Public Employees deal, except that State Street will not manage any of the investment pools in the teachers' plan.
Instead, it will track investor records and man a telephone line participants can call for information.
California State Teachers plans to start marketing the new defined- contribution service to its members in July, said Randy Taylor, a vice president in State Street's public funds services division.