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What changed in SEI INVESTMENTS CO's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of SEI INVESTMENTS CO's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+314 added−358 removedSource: 10-K (2025-02-20) vs 10-K (2024-02-20)

Top changes in SEI INVESTMENTS CO's 2024 10-K

314 paragraphs added · 358 removed · 208 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe help advisors manage and grow their businesses by offering consultative practice management services, including access to our business transition services, case management expertise, thought leadership, and marketing and growth programs. This business is primarily based on approximately 2,300 investment advisors who each have a minimum of $5.0 million in customer assets invested in our programs.
Biggest changeThese programs include goals-based strategies, SEI-curated models that utilized multiple structures such as direct indexing, separately managed accounts, ETFs, and mutual funds, to help advisors align diversified portfolios with client needs. • Advisor services: We help advisors manage and grow their businesses by offering consultative practice management services, including access to our business transition services, case management expertise, third-party applications, thought leadership, and marketing and growth programs.
Competitors for OCIO services at larger institutional investors may include global advisory firms offering fiduciary management services such as Aon Hewitt and Willis Towers Watson, as well as with asset management firms like Mercer and Russell Investments. We also compete with numerous investment-management firms, including regional or boutique firms with an industry specialization.
Competitors for OCIO services at larger institutional investors may include global advisory firms offering fiduciary management services, such as Aon Hewitt and Willis Towers Watson, as well as asset management firms like Mercer and Russell Investments. We also compete with numerous investment management firms, including regional or boutique firms with an industry specialization.
These subsidiaries include: • SEI Investments Distribution Co., or SIDCO, a broker-dealer registered with the SEC under the Securities Exchange Act of 1934 and a member of the Financial Industry Regulatory Authority, Inc., or FINRA; • SEI Investments Management Corporation, or SIMC, an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and with the Commodity Futures Trading Commission, or CFTC, under the Commodity Exchange Act; • SEI Private Trust Company, or SPTC, a limited purpose federal thrift chartered and regulated by the Office of the Comptroller of the Currency; • SEI Trust Company, or STC, a Pennsylvania trust company, regulated by the Pennsylvania Department of Banking and Securities; • SEI Institutional Transfer Agent, Inc., or SITA, a transfer agent registered with the SEC under the Securities Exchange Act of 1934. • SEI Investments (Europe) Limited, or SIEL, an investment manager and financial institution subject to regulation by the Financial Conduct Authority of the United Kingdom; • SEI Investments Canada Company, or SEI Canada, an investment fund manager that has various other capacities that is regulated by the Ontario Securities Commission and various provincial authorities; 11 • SEI Investments Global, Limited, or SIGL, a management company for Undertakings for Collective Investment in Transferable Securities, or UCITS, and for Alternative Investment Funds, or AIFs, that is regulated primarily by the Central Bank of Ireland, or CBI; • SEI Investments - Global Fund Services, Ltd., or GFSL, an authorized provider of administration services for Irish and non-Irish collective investment schemes that is regulated by the CBI; • SEI Investments - Depositary and Custodial Services (Ireland) Limited, or D&C, an authorized provider of depositary and custodial services that is regulated by the CBI; • SEI Investments - Luxembourg S.A., or SEI Lux, a professional of the specialized financial sector subject to regulation by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg; • SEI Investments Global (Cayman), Ltd., a full mutual fund administrator that is regulated by the Cayman Island Monetary Authority; and • SEI Investments (South Africa) (PTY) Limited, a Private Company that is a licensed Financial Service Provider regulated by the Financial Sector Conduct Authority.
These subsidiaries include: • SEI Investments Distribution Co., or SIDCO, a broker-dealer registered with the SEC under the Securities Exchange Act of 1934 and a member of the Financial Industry Regulatory Authority, Inc., or FINRA; • SEI Investments Management Corporation, or SIMC, an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and with the Commodity Futures Trading Commission, or CFTC, under the Commodity Exchange Act; • SEI Private Trust Company, or SPTC, a limited purpose federal thrift chartered and regulated by the Office of the Comptroller of the Currency; • SEI Trust Company, or STC, a Pennsylvania trust company, regulated by the Pennsylvania Department of Banking and Securities; • SEI Institutional Transfer Agent, Inc., or SITA, a transfer agent registered with the SEC under the Securities Exchange Act of 1934. • SEI Investments (Europe) Limited, or SIEL, an investment manager and financial institution subject to regulation by the Financial Conduct Authority of the United Kingdom, or FCA; • SEI Investments Canada Company, or SEI Canada, an investment fund manager that has various other capacities that is regulated by the Ontario Securities Commission and various provincial authorities; • SEI Investments Global, Limited, or SIGL, a management company for Undertakings for Collective Investment in Transferable Securities, or UCITS, and for Alternative Investment Funds, or AIFs, that is regulated primarily by the Central Bank of Ireland, or CBI; • SEI Investments - Global Fund Services, Ltd., or GFSL, an authorized provider of administration services for Irish and non-Irish collective investment schemes that is regulated by the CBI; • SEI Investments - Depositary and Custodial Services (Ireland) Limited, or D&C, an authorized provider of depositary and custodial services that is regulated by the CBI; • SEI Investments - Luxembourg S.A., or SEI Lux, a professional of the specialized financial sector subject to regulation by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg; • SEI Investments Global (Cayman), Ltd., a full mutual fund administrator that is regulated by the Cayman Island Monetary Authority; and • SEI Investments (South Africa) (PTY) Limited, a Private Company that is a licensed Financial Service Provider regulated by the Financial Sector Conduct Authority.
Competitors for Unbundled OCIO services include data analytics software firms and investment data management providers. Fees are primarily earned as a percentage of average assets under management calculated using the average of the four-month ending balances preceding the billing date.
Competitors for unbundled OCIO services include data analytics software firms and investment data management providers. Fees in our Institutional Investors business are primarily earned as a percentage of average assets under management calculated using the average of the four-month ending balances preceding the billing date.
In the event of a failure to comply with laws, regulations, and requirements of these agencies and authorities, the possible business process changes required or sanctions that may be imposed include the suspension of individual employees, limitations on our ability to engage in business for specified periods of time, the revocation of applicable registration as a broker-dealer, investment advisor or other regulated entity, and, as the case may be, censures and fines.
In the event of a failure to comply with laws, regulations, and requirements of these agencies and authorities, or to meet regulator expectations, the possible business process changes required or sanctions that may be imposed include the suspension of individual employees, limitations on our ability to engage in 6 business for specified periods of time or a direction that we comply with certain restrictions, the revocation of applicable registration as a broker-dealer, investment advisor or other regulated entity, and, as the case may be, censures and fines.
Investors outsource some or all investment management functions based on their preferred governance structure, business needs, and financial objectives. Our Unbundled OCIO platform supports internal investment teams through SEI Novus SM , a global portfolio intelligence tool, and SEI’s comprehensive investment processing, shadow accounting, and data and workflow management.
Investors outsource some or all investment management functions based on their preferred governance structure, business needs, and financial objectives. • Unbundled OCIO: Supports internal investment teams through SEI Novus SM , a global portfolio intelligence tool, and SEI’s comprehensive investment processing, shadow accounting, and data and workflow management, as well as access to alternative investment products.
Enabled by the SEI Wealth Platform, these services include front-office investment management and end-investor collaboration capabilities, middle-office administrative outsourcing, and back-office processing and custody services. • Customized Investment Management Programs . We provide advisors with an array of investment programs to customize portfolios for their personal or institutional investors.
We provide advisors with a flexible operating platform offering a complete end-to-end business, technology and operational solution with capabilities across the front, middle, and back office, including: • Technology and administrative services: Enabled by the SEI Wealth Platform, these services include front-office investment management and end-investor collaboration capabilities, middle-office administrative outsourcing, and back-office processing and custody services. • Customized investment management programs: We provide advisors with an array of investment programs to customize portfolios for their personal or institutional investors.
Our plan sponsor clients and our subsidiaries providing services to those clients are subject to supervision by the Department of Labor and compliance with employee benefit regulations. Investment advisor and broker-dealer clients are regulated by the SEC, state securities authorities, or FINRA. Existing or future regulations applicable to our clients may affect our clients’ purchase of our products and services.
Our plan sponsor clients 7 and our subsidiaries providing services to those clients are subject to supervision by the Department of Labor and compliance with employee benefit regulations. Investment advisor and broker-dealer clients are regulated by the SEC, state securities authorities, or FINRA.
As of December 31, 2023, we had significant relationships with 109 clients, including TRUST 3000 ® relationships with 40 bank and trust institutions in the United States, and SWP relationships with 69 signed banks, independent wealth advisers and other wealth managers located in the United Kingdom and the United States.
As of December 31, 2024, we had significant relationships with 117 clients, including TRUST 3000 ® relationships with 37 bank and trust institutions in the United States, and SWP relationships with 80 signed banks, independent wealth advisers and other wealth managers located in the United Kingdom and the United States.
They include State Street, BNY Mellon, Northern Trust, SS&C Technologies, and Citco. Investments in New Businesses The Investments in New Businesses segment represents other business ventures or research and development activities intended to expand our solutions to new or existing markets, including ultra-high-net-worth families who reside in the United States.
Investments in New Businesses The Investments in New Businesses segment represents other business ventures or research and development activities intended to expand our solutions to new or existing markets, including ultra-high-net-worth families who reside in the United States.
As of December 31, 2023, we managed $342.7 billion in assets including: • $175.5 billion invested in fixed-income and equity funds and separately managed account programs; • $156.4 billion invested in collective trust fund programs; and • $10.8 billion invested in liquidity or money market funds.
As of December 31, 2024, we managed $390.2 billion in assets including: • $180.0 billion invested in fixed-income and equity funds and separately managed account programs; • $202.4 billion invested in collective trust fund programs; and • $7.8 billion invested in liquidity or money market funds.
Our competitors include in-house information technology organizations, as well as wealth management technology service providers such as Fidelity National Information Services, Inc. (FIS), Fi-Tek, SS&C Innovest, FNZ UK Ltd. and Avaloq. This segment also provides investment management programs to wealth managers and financial services intermediaries in North America, Europe, and Asia.
Our competitors include in-house information technology organizations, as well as wealth management technology service providers such as Fidelity National Information Services, Inc. (FIS), Fi-Tek, SS&C Innovest, FNZ UK Ltd. and Avaloq.
In addition, see the discussion of governmental regulations in Item 1A, Risk Factors for a description of the risks that the current regulatory regimes and proposed regulatory changes may present for our business. 13
Existing or future regulations applicable to our clients may affect our clients’ purchase of our products and services. In addition, see the discussion of governmental regulations in Item 1A, Risk Factors for a description of the risks that the current regulatory regimes and proposed regulatory changes may present for our business. See also “Note 10.
As one of the first and largest providers of outsourced investment management services, we deliver solutions that leverage the breadth of our investment management, advisory, administration, technology, and operational capabilities to help institutional investors make more confident decisions and achieve greater control, reduced risk, and improved efficiencies.
Both fully outsourced and unbundled solutions leverage the breadth of our investment management, advisory, administration, technology, and operational capabilities to help institutional investors make more confident decisions, achieve greater control, reduce risk, and improve efficiencies.
We primarily serve retirement plan sponsors, healthcare systems, higher education, not-for-profit organizations, and other institutional asset owners in the United States, Canada, the United Kingdom, continental Europe, South Africa, and East Asia. SEI’s Outsourced Chief Investment Officer (OCIO) platform supports institutional investors who delegate investment management decisions through a flexible implementation model.
Providing fully outsourced CIO (OCIO) and unbundled OCIO services, we primarily serve retirement plan sponsors, healthcare systems, higher education, not-for-profit organizations, and other institutional asset owners. • OCIO: Supports institutional investors who delegate investment management decisions through a flexible implementation model.
This segment also includes costs associated with managed security services through SEI Sphere, the modularization of larger technology platforms, and a family wealth management solution offering flexible family-office type services through a highly personalized solution utilizing a goals-based planning process.
This segment also includes costs associated with providing managed security services through SEI Sphere ® , the modularization of larger technology platforms, and a private client wealth management solution offering flexible family office-type services through a highly personalized solution that utilizes a goals-based approach. 5 Human capital Our talented workforce is the key to our ability to serve our clients globally.
As of December 31, 2023, we have asset management distribution relationships in this segment with banks, wealth managers, and other financial services firms, including 92 clients who had at least $5.0 million each in customer assets invested in our programs.
This segment also provides asset management programs to banks, wealth managers and other financial services firms, including 29 clients who had at least $100.0 million each in customer assets invested in our programs as of December 31, 2024. Competitors for our asset management services may include in-house investment teams and global asset management firms, such as LPL Financial and BlackRock.
Revenues are primarily earned as a percentage of average daily assets under management. Revenues for non-managed assets are earned as a percentage of average daily assets processed. We compete with other custodians and providers of advisor technology products, money managers (both active and passive), turnkey asset management platform providers, and broker-dealers with affiliated advisor networks.
Fees are typically bundled and embedded in asset management or custody fees. We compete with other custodians and providers of advisor technology products, money managers (both active and passive), turnkey asset management platform providers, and broker-dealers with affiliated advisor networks.
Furthermore, a violation of a sanction or embargo program or anti-corruption or anti-money laundering laws and regulations could subject us and our subsidiaries, and individual employees, to regulatory enforcement actions as well as significant civil and criminal penalties. 12 Our businesses are also subject to privacy and data protection information security legal requirements concerning the use and protection of certain personal information.
We can incur higher costs and face greater compliance risks in structuring and operating our businesses to comply with these requirements. Furthermore, a violation of a sanction or embargo program or anti-corruption or anti-money laundering laws and regulations could subject us and our subsidiaries, and individual employees, to regulatory enforcement actions as well as significant civil and criminal penalties.
Our platforms include advanced technologies for asset management and wealth advisory and administration, as well as processing, infrastructure, and cybersecurity services. Our platforms also include technology and operationally-enabled investment service capabilities for a broad range of traditional and alternative investments, delivered as unbundled product components for front, middle, and back offices.
Our technology and operations platform also includes technology and operationally-enabled investment service capabilities for a broad range of traditional and alternative investment managers, delivered as unbundled product components for front, middle, and back offices through our Investment Managers segment. Asset management We provide comprehensive solutions for managing personal and institutional wealth.
Principal competitors include diversified firms that focus on custody operations such as Charles Schwab & Co., Inc., Pershing LLC and Fidelity Investments, as well investment advisory platform providers, such as AssetMark Financial Holdings and Envestnet. Institutional Investors We provide institutional investors with a variety of solutions aligned with their investment implementation preferences.
Principal competitors include investment advisory platform providers, such as Envestnet and Orion, as well as diversified firms that focus on custody operations, such as Charles Schwab & Co., Inc., Fidelity Investments, and LPL Financial. Institutional Investors Our Institutional Investors business is one of the first and largest providers of outsourced investment management services.
Our solutions are designed to provide the advanced operating infrastructure, technologies, and operational and administrative capabilities that are vital to the success of wealth management organizations, helping them achieve their business objectives, manage change and complex operations, replace legacy platforms, comply with regulations, and deploy capital more effectively.
Clients include several financial institutions whose relationships span decades with SEI. Our solutions provide the investment processing, operations, and administrative capabilities that are vital to helping wealth management businesses achieve their business objectives, manage change and complex operations, replace legacy platforms, comply with regulations, and deploy capital more effectively. Contracts generally range from five to seven years.
An additional $89.3 billion in assets is managed by our unconsolidated affiliate LSV Asset Management (LSV), a registered investment advisor (RIA) that specializes in value equity management for its clients. Investment management revenues are earned primarily as a percentage of net assets under management.
An additional $86.5 billion in assets is managed by our unconsolidated affiliate LSV Asset Management (LSV), a registered investment advisor (RIA) that specializes in value equity management for its clients. 3 Business segments overview Our business segments are generally organized around our target markets. Financial information about each business segment is contained in "Note 12.
We will continue to add new asset managers, asset owners, family offices, and private wealth advisors as clientele, and grow our existing client relationships while expanding into new markets. Contracts for the outsourcing services we provide generally have terms ranging from three to five years, and fees are earned primarily as a percentage of assets under management and administration.
Contracts for the outsourcing services we provide generally have terms ranging from three to five years, and fees are earned primarily as a percentage of assets under management and administration. In addition, 16% of the revenues for this segment is earned as account servicing fees.
We are headquartered in Oaks, Pennsylvania and support clients globally from service centers primarily located in the United States, United Kingdom, Ireland, Canada, continental Europe, and South Africa. We were founded in 1968 and became a public company in 1981. Mission and Strategy SEI’s mission is to build brave futures SM through the power of connection.
We are headquartered in Oaks, Pennsylvania, and approximately 5,000 employees support clients from service centers located in the United States, United Kingdom, Ireland, Canada, continental Europe, India, and South Africa.
We deliver active, factor-based, and passively managed solutions to give firms the ability to focus on their clients while implementing and maintaining consistent, efficient processes that help them grow their businesses and manage risk.
We serve as sponsor, administrator, transfer agent, investment advisor, distributor, and shareholder servicer for many of these products. Our active, factor-based, and passively managed solutions enable our clients to focus on their clients while implementing processes that help them gain efficiencies, manage risk, and grow their businesses.
Our outsourcing solutions accommodate investment managers of all sizes and complexities, from the unique needs of emerging and start-up managers to the complex needs of global, multi-asset hybrid managers. Our capabilities include data and information management and analytics; investment operations; regulatory and compliance support; fund administration, fund accounting and depository services; investor reporting; distribution support; and middle office services.
Our capabilities span the front, middle, and back office to manage assets, including supporting complex fund structures through best-in-class data and information management and analytics; investment operations; regulatory and compliance support; fund administration, fund accounting and depository services; investor reporting; distribution support; and middle office services.
Investment processing platforms are offered in Software-as-a-Service (SaaS) or Platform-as-a-Service (PaaS) delivery modes. SaaS includes investment processing software and information processing services. PaaS includes software and information processing services, as well as business processing outsourcing services, including back and middle-office operations, accounting, and custodial services. Contracts for TRUST 3000 ® and SWP services generally range from five to seven years.
PaaS includes software and information processing services, as well as business processing outsourcing services, including back- and middle-office operations, accounting, and custodial services.
These platforms include goals-based investment strategies; SEI-sponsored and third-party investment products, including ETFs, mutual funds, collective investment products, alternative investment portfolios, and separately managed accounts; and other market-specific advice, technology, and operational components.
These solutions include investment strategies, customized investment management programs, and SEI-sponsored and third-party investment products to support an investor’s organizational or personal goals. Investment strategies are typically implemented with investment products that include ETFs, alternative investments, collective investment products, separately managed accounts, and mutual funds.
Capabilities span the front, middle, and back office and are designed to support a diverse mix of investors, accounts, and asset types, including portfolio management, client administration, accounting, and investment processing. SWP’s open architecture also allows for technology integrations with other SEI capabilities and client systems to enable an integrated and seamless private banking and wealth management experience.
SWP’s open architecture also allows for technology integrations with other SEI capabilities and client systems to enable a seamless wealth management experience. Investment processing platforms are offered in Software-as-a-Service (SaaS) or Platform-as-a-Service (PaaS) delivery. SaaS includes investment processing software and information processing services.
Through our integrated or unbundled solutions, we help advisors reduce risk, improve quality and gain operational efficiencies that enable them to devote more of their resources to growing their businesses and achieving better financial outcomes for their clients. 8 Advisors are responsible for the investor relationship, including financial plan creation, investment strategy implementation, and customer education and servicing.
Our clients are responsible for the investor relationship, including financial plan creation, investment strategy implementation, and customer education and servicing.
Core Capabilities Sitting at the intersection of technology and investments, we combine one or more of three core capabilities, including technology services, investment operations, and asset management, into outsourced solutions tailored to the needs of each market we serve. • Technology and operations We provide technology and operations services to banks, wealth managers, trust companies, investment managers, asset owners, independent wealth advisers, investment advisors, financial planners, family offices, and other financial services firms.
We deliver our services standalone or combine multiple capabilities into comprehensive solutions designed to meet the needs of each market we serve globally. Our clients include wealth managers, banks, investment advisors, asset managers, family offices, institutional investors, and ultra-high-net-worth investors.
These programs leverage more than four decades of experience with manager research and advice, asset allocation, and portfolio construction. We believe that we can provide flexible and better solutions and quicker speed to market through outsourcing.
These solutions and programs leverage more than four decades of experience with manager research, advice, asset allocation, and portfolio construction. Additionally, our robust technology offering creates a differentiated competitive advantage. We are able to monetize our technology either directly or as part of a comprehensive asset management offering in which technology is included within our asset management fees.
Investment Advisors We provide wealth management technology and investment solutions for independent financial advisors throughout the United States across the RIA and independent broker/dealer market segments, including independent investment advisors, financial planners, life insurance agents and other wealth managers.
Investment Advisors We provide wealth management technology, operations, and asset management solutions for independent financial advisors across the RIA and independent broker/dealer market segments. 4 This segment offers both fully integrated and unbundled solutions that enable advisors to devote more of their resources to growing their businesses and achieving better financial outcomes for their clients.
Our solutions provide the advanced operational infrastructure, technologies, and skills critical to our clients’ success, enabling their ability to navigate constantly evolving markets and increasingly complex business challenges. Our clients include asset owners and a diverse, sophisticated group of alternative, traditional, and hybrid investment managers including 48 of the top 100 managers worldwide.
Our clients include asset owners and a diverse, sophisticated group of alternative, traditional, and hybrid investment managers globally.
We offer trustee, investment management, and administration services for collective investment trusts (CITs), serving the U.S. retirement market. We help our clients view their business in a comprehensive and integrated way, providing insight into potential risks and giving them increased control over their business results.
We also offer trustee, investment management, and administration services for collective investment trusts, serving the U.S. retirement market. SEI’s global operational footprint services funds in all major jurisdictions amid a constantly evolving regulatory environment.
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Item 1. Business. Corporate Overview SEI delivers technology and investment solutions that connect the financial services industry. With capabilities across investment processing, operations, and asset management, SEI works with corporations, financial institutions and professionals, and ultra-high-net-worth families to help drive growth, make confident decisions, and protect futures.
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Item 1. Business. Corporate overview SEI Investments Company (together, with its subsidiaries unless otherwise noted, “SEI” or the “Company”) is a leading global provider of financial technology, operations, and asset management services within the financial services industry.
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SEI’s four core business segments provide outsourcing services to banks, investment advisors, investment managers and institutional investors. We serve a broad range of client types of all sizes and complexity, including 10 of the top 20 U.S. banks and 48 of the top 100 investment managers worldwide.
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We tailor our solutions and services to help our clients more effectively deploy their capital—whether that’s money, time, or talent—so they can better serve their clients and achieve their growth objectives.
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Investments in New Businesses is a fifth segment, focused on other businesses, ventures or research and development activities intended to expand our solutions to new or existing markets. SEI manages, advises, or administers approximately $1.4 trillion in assets.
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In 2024, we earned approximately 55% of our revenue from technology and operations outsourcing and 40% from asset management fees, with the remainder attributable to professional services and other ancillary services. SEI provides these services across four core client-oriented business segments; Investment Managers, Private Banks, Investment Advisors, and Institutional Investors.
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The needs of wealth managers, investment managers, financial advisors, family offices, and investors continue to converge, particularly among larger firms and investors. They face increasing competitive and market pressures, ever-growing regulations, and the need to replace aging legacy technologies. They also seek to expand services, offer differentiated solutions, improve efficiencies, reduce risk, and better manage their businesses.
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SEI’s clients include 8 of the top 20 U.S. banks and 43 of the top 100 investment managers worldwide, and we manage, advise or administer approximately $1.6 trillion in assets.
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With relationships across the financial services industry, we're uniquely positioned to meet our clients’ emerging and converging needs, help them make confident decisions and transform their businesses, and capture growth opportunities that increase shareholder value. Key strategies include: • Transforming how we drive growth.
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Core capabilities With our core competency pillars of technology, operations, and asset management, the breadth of the markets we serve and capabilities across investment processing, investment operations, and investment management uniquely position us in the financial services industry.
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We are focused on capitalizing on market trends and connecting addressable market opportunities to deliver the outsourced solutions our markets value. We continuously seek to enhance existing capabilities, create broader solutions, and invest in new ideas for new solutions. We enable an unbundled approach to delivery through aggregated data sourced from multiple systems and modularizing specific applications into standalone components.
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For the Year Ended December 31, 2024 (all dollar amounts in thousands) Investment Managers Private Banks Investment Advisors Institutional Investors Investments in New Businesses Total Investment Technology & Operations $ 697,014 $ 381,033 $ 57,455 $ 9,815 $ 25,409 $ 1,170,726 Asset Management 363 137,512 431,630 263,679 20,234 853,418 Professional Services & Other 31,013 22,869 20,323 12,229 14,573 101,007 Total Revenues $ 728,390 $ 541,414 $ 509,408 $ 285,723 $ 60,216 $ 2,125,151 2 Technology and operations We provide the technology and operational infrastructure across the front, middle, and back office to help our clients scale, increase efficiency, and improve performance.
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We believe this approach, as well as assessing opportunities for mergers and acquisitions, allow us to create flexible, client-responsive solutions, address the complex needs of larger firms, and expand the size of our addressable markets. • Investing in talent. The attraction, retention, and development of diverse talent is paramount to continuing to deliver tech-forward solutions to our markets globally.
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Capabilities include: • Business process outsourcing and custody • Fund administration, depositary services, investment accounting, and investor servicing • Curated suite of internally managed and third-party investment products, including ETFs, SMAs, and UMAs • Investment expertise in direct indexing, factor-based, alternatives, and tax management • Discretionary investment management for institutions in need of expertise, infrastructure and enhanced governance • Data and information management, analytics, and reporting • Regulatory and compliance service • Network operations, cloud, and cybersecurity services Our proprietary technology platforms include the SEI Wealth Platform SM (SWP) and its predecessor, TRUST 3000 ® .
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We continue to evaluate opportunities to competitively position SEI as an employer of choice, including compensation, training, and development programs. We look to 2 leverage the talent, technology, and capabilities across the company for the benefit of our clients and to expand opportunities for our employees. • Igniting our culture.
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We use these technologies to deliver operations and administrative outsourcing services, including custodial and back-office accounting services. SWP offers a modern, fully-integrated, single infrastructure solution that integrates technology, operational outsourcing, and asset management. Capabilities span the front, middle, and back office and are designed to support a diverse mix of investors, accounts, and asset types.
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We strive to cultivate an environment where our behavior aligns with our corporate values of courage, integrity, collaboration, inclusion, connection, and fun. Our focus on promoting flexibility and work/life integration for our employees, acting with a sense of urgency, and encouraging and rewarding positive risk-taking and productive debate enable us to deliver world-class service and solutions for our clients.
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Solutions are offered both individually and as part of model portfolios, with the majority of our asset management business historically focused on model portfolios. SEI has earned a well-regarded reputation in the market for clients seeking whole portfolio and model portfolio solutions due to our size and long track record in offering these products.
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Business Model Our growth strategies are anchored in our proven business model. We pursue growth by focusing on four critical elements: turning challenges into opportunities, driving mutual growth, meaningfully engaging clients and employees, and leveraging our financial strength. • Turn challenges into opportunities . For more than 55 years, we have delivered solutions that anticipate and address complex business challenges.
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Business Segment Information" included in our Notes to Consolidated Financial Statements.
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We balance our investments over the short, medium and long term to serve existing clients, enhance existing solutions, develop new capabilities, expand markets, and keep an eye toward the future to deliver new sources of growth. • Drive mutual growth.
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The percentage of consolidated revenues generated by our business segments for the last three years was: 2024 2023 2022 Investment Managers 34 % 33 % 30 % Private Banks 26 % 26 % 29 % Investment Advisors 24 % 23 % 22 % Institutional Investors 13 % 15 % 16 % Investments in New Businesses 3 % 3 % 3 % 100 % 100 % 100 % Investment Managers We provide a comprehensive, outsourced investment management operating platform to alternative and traditional asset managers, fund companies, and sovereign wealth funds.
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We focus on the long term, helping our clients more intelligently deploy their capital and achieving sustainable growth by delivering enterprise-wide platforms to the markets we serve. We are growing the business through new-name sales, cross-sales, and solution delivery, as well as entering adjacent markets by delivering existing and new solutions.
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Our outsourcing solutions across the front-to-back office with best-in-breed technology accommodate investment managers of all sizes and complexities and enables them to focus on core business activities—from the unique needs of emerging and start-up managers to the complex needs of global, multi-asset hybrid managers.
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To enhance our capabilities, scale our competitive presence, or enable strategic growth, we pursue selective acquisitions. • Engage clients and employees. We foster an open, collaborative, client-first culture to nurture a talented and engaged workforce, forge intimate, enduring client relationships, be a thought leader in the markets we serve, and craft “win-win” pricing models.
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Our competitors vary according to the asset class or solutions provided and the domiciles in which they operate. They include SS&C Technologies, State Street, BNY Mellon, Northern Trust, and Citco. Private Banks We provide technology, operations, and asset management solutions primarily to the wealth management businesses embedded within banks and trust companies, in addition to independent wealth advisors.
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We believe SEI’s long-lasting client relationships—some of which span decades—are fundamental to enhancing SEI’s financial strength. • Leverage financial strength. We focus on achieving long-term, sustainable revenue and earnings growth. We maintain a strong balance sheet and are committed to research and development. We favor scalable businesses that generate recurring revenues and predictable cash flows.
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At December 31, 2024, we had 5,066 full-time and 32 part-time employees. Employee unions do not represent any of our employees. Corporate sustainability Our values are the foundation from which we drive our company’s and our clients’ long-term success and make an impact on our communities.
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SEI’s revenue is highly recurring; we generate strong cash flow, and we have a long history of profitability. We return capital to shareholders through stock repurchases and paid dividends. Other Competitive Advantages Our experience in delivering technology and investment solutions, market leadership position, industry expertise, operational footprint, and proven business model serve as competitive advantages.
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We work with each other and welcome diverse perspectives to foster an inclusive environment and solve problems that matter. We think and act like owners, having the courage to push boundaries and do the right thing in the best interest of our company, clients, and community.
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Other key advantages include: • We are uniquely positioned in the wealth and investment management industry. We provide critical capabilities across technology, operations, and asset management, delivered standalone or combined into comprehensive solutions.
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More information about our commitment to corporate sustainability can be found in our Corporate Sustainability Report. Regulatory considerations We conduct our operations through several regulated wholly-owned subsidiaries.
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These capabilities and our multi-industry expertise uniquely position us to address the emerging and increasingly converging needs of wealth managers, asset owners, and investors. • We leverage our assets across the company. We invest in business opportunities derived from our core competencies. We seek to make our assets, particularly technology, available as components for all of our markets.
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Currently, our subsidiary in the United Kingdom, SIEL, is working with the FCA to determine the nature and scope of remedial actions in which SIEL will engage in order to meet the FCA's expectations and to enable SIEL to continue to grow and execute on its development and offering of new products and solutions.
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We are both a provider and a user of many of our services. This dual role helps to drive service quality and product innovation. As an example, we provide fund accounting capabilities for the investment products we manage, as well as for those we administer for clients.
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Our businesses are also subject to privacy and data protection information security legal requirements concerning the use and protection of certain personal information.
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We also leverage our principal business platforms and assets across multiple market segments, further enhancing the potential for operating leverage. • Our dynamic workforce is key to our success and is the foundation of our culture. Each of our employees brings a distinct set of skills, strengths, experiences, and backgrounds, which contribute to our individual and collective growth.
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Commitments and Contingencies” included in our Notes to Consolidated Financial Statements for a more fulsome summary of our current regulatory matters with the FCA.
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We also believe our business should be conducted in a manner that achieves sustainable growth and demonstrates a commitment to corporate social responsibility (CSR).
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We expect all employees to exemplify our values and act responsibly, ethically, and with integrity in our dealings with each other, our clients, and the community. • Business continuity planning and disaster recovery exercises continue to reinforce our preparedness . Our products and services are enabled by SEI’s information technology infrastructure and supported by onsite employees.
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We also maintain and regularly exercise enterprise-wide business continuity tests. During the pandemic-driven shutdown of onsite operations, we were able to maintain operational integrity for clients and seamlessly transition to a remote work environment for our global workforce. More recently, we were able to welcome back our workforce to our offices without disruption to our clients.
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This flexibility enables us to adapt sales and client-onboarding processes for virtual engagement, delivery, and operations. 3 • We are committed to bringing new solutions to our markets. We develop and nurture new business initiatives that we believe present opportunities for longer-term growth.
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An important component to achieving our growth goals is solidifying the foundation from which we launch new businesses that can contribute to our success. In order to consistently generate new business ideas, test, and launch them, our Investments in New Businesses segment explores opportunities to incubate and accelerate those new ideas and cultivate innovation that drives top-line growth.
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Our Corporate Development team focuses on the development, execution, and integration of potential strategic transactions to accelerate growth.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeViews on ESG practices, particularly those related to climate issues, have also become political issues, which can amplify these risks. Any adverse publicity or reaction in connection with ESG issues could damage our reputation, ability to attract and retain clients and employees, compete effectively, and grow our business.
Biggest changeThe politicization of ESG practices, particularly those related to climate issues, has amplified these risks. We acknowledge that any action or lack thereof with respect to ESG matters may be perceived negatively by at least some stakeholders, potentially damaging our reputation, ability to attract and retain clients and employees, compete effectively, and grow our business. Item 1B. Unresolved Staff Comments.
Inefficiencies or operational failures, including temporary or permanent loss of customer data, damaged software codes, delayed or inaccurate processing of transactions, insufficient Internet connectivity, or inadequate storage and compute capacity, could diminish the quality of our products, services, and user experience resulting in contractual liability, claims by customers and other third parties, regulatory actions, damage to our 17 reputation, and loss of current and potential users, each of which may adversely impact our consolidated financial statements.
Inefficiencies or operational failures, including temporary or permanent loss of customer data, damaged software codes, delayed or inaccurate processing of transactions, insufficient Internet connectivity, or inadequate storage and compute capacity, could diminish the quality of our products, services, and user experience resulting in contractual liability, claims by customers and other third parties, regulatory actions, damage to our reputation, and loss of current and potential users, each of which may adversely impact our consolidated financial statements.
These risks include, for example: • managing geographically separated organizations, systems and facilities; • integrating personnel with diverse business backgrounds and organizational cultures; • complying with non-U.S. regulatory requirements; • fluctuations in currency exchange rates; • enforcement of intellectual property rights in some non-U.S. countries; • difficulty entering new non-U.S. markets due to, among other things, consumer acceptance and business knowledge of these new markets; and • general economic and political conditions.
These risks include, for example: • managing geographically separated organizations, systems and facilities; • integrating personnel with diverse business backgrounds and organizational cultures; • complying with non-U.S. regulatory requirements; • fluctuations in currency exchange rates; • enforcement of intellectual property rights in some non-U.S. countries; 17 • difficulty entering new non-U.S. markets due to, among other things, consumer acceptance and business knowledge of these new markets; and • general economic and political conditions.
Adverse movements in currency exchange rates may negatively affect our operating results, liquidity, contract values and financial condition. Changes in interest rates may affect the value of our fixed-income investment securities. We own Government National Mortgage Association (GNMA) mortgage-backed securities for the sole purpose of satisfying applicable regulatory requirements imposed on our wholly-owned limited purpose federal thrift subsidiary, SPTC.
Adverse movements in currency exchange rates may negatively affect our operating results, liquidity, contract values and financial condition. Changes in interest rates may affect the value of our fixed-income investment securities. We own Government National Mortgage Association (GNMA) mortgage-backed securities for the sole purpose of satisfying applicable 19 regulatory requirements imposed on our wholly-owned limited purpose federal thrift subsidiary, SPTC.
A number of our clients have frozen or curtailed their defined benefit plans resulting in decreased revenues and earnings related to this market segment. We have also experienced increasing fee sensitivity and competition for certain fiduciary management services due to investor preferences toward lower-priced investment products including passive management approaches.
A number of our clients have frozen or curtailed their defined benefit plans resulting in decreased revenues and earnings related to this market segment. We have also experienced increasing fee sensitivity and competition for certain fiduciary management services due to investor preferences toward lower-priced investment products including passive 10 management approaches.
Our various business activities in the United States are conducted through entities such as an investment advisor, broker-dealer, commodity pool operator, transfer agent, investment company, national bank and trust company which may be registered with or regulated by the SEC, FINRA, CFTC, NFA, DOL, OCC, and the PA Department of Banking.
Our various business activities in the United States are conducted through entities such as an investment advisor, broker-dealer, commodity pool operator, swap dealer, transfer agent, investment company, national bank and trust company which may be registered with or regulated by the SEC, FINRA, CFTC, NFA, DOL, OCC, and the PA Department of Banking.
Such changes could result in our remaining competitors gaining greater capital and other resources, such as the ability to offer a broader range of products and services and geographic diversity, or new competitors may emerge. Our investment management platforms include investment management programs and back-office investment processing outsourcing services and are generally offered on a bundled basis.
Such changes could result in our remaining competitors gaining greater capital and other resources, such as the ability to offer a broader range of products and services and geographic diversity, or new competitors may emerge. 9 Our investment management platforms include investment management programs and back-office investment processing outsourcing services and are generally offered on a bundled basis.
Outside the United States, applicable laws, rules and regulations similarly require designated types of financial institutions to implement compliance programs to address regulatory requirements related to 19 money laundering, financial crime and the financing of terrorist activities. Failure to implement comprehensive anti-money laundering programs across our globally-regulated businesses poses regulatory risk including fines for noncompliance.
Outside the United States, applicable laws, rules and regulations similarly require designated types of financial institutions to implement compliance programs to address regulatory requirements related to money laundering, financial crime and the financing of terrorist activities. Failure to implement comprehensive anti-money laundering programs across our globally-regulated businesses poses regulatory risk including fines for noncompliance.
In addition, if a number of our clients terminate their 18 contracts, liquidate funds or fail to renew management contracts on favorable terms, the fees we earn could be reduced, which may cause our assets under management, revenue and earnings to decline. We rely on the services of third-party sub-advisers.
In addition, if a number of our clients terminate their contracts, liquidate funds or fail to renew management contracts on favorable terms, the fees we earn could be reduced, which may cause our assets under management, revenue and earnings to decline. We rely on the services of third-party sub-advisers.
A successful penetration or circumvention of the security of our systems or the systems of a vendor, governmental body or another market participant could cause serious negative consequences, including: 16 • significant disruption of our operations and those of our clients, customers and counterparties, including losing access to operational systems; • misappropriation of our confidential information or that of our clients, counterparties, vendors, employees or regulators; • damage to our technology infrastructure or systems and those of our clients, vendors and counterparties; • inability to fully recover and restore data that has been stolen, manipulated or destroyed, or to prevent systems from processing fraudulent transactions; • violations by us of applicable privacy and other laws; • financial loss to us or to our clients, vendors, counterparties or employees; • loss of confidence in our cyber security measures; • dissatisfaction among our clients or counterparties; • significant exposure to litigation and regulatory fines, penalties or other sanctions; and • harm to our reputation.
A successful penetration or circumvention of the security of our systems or the systems of a vendor, governmental body or another market participant could cause serious negative consequences, including: • significant disruption of our operations and those of our clients, customers and counterparties, including losing access to operational systems; • misappropriation of our confidential information or that of our clients, counterparties, vendors, employees or regulators; • damage to our technology infrastructure or systems and those of our clients, vendors and counterparties; • inability to fully recover and restore data that has been stolen, manipulated or destroyed, or to prevent systems from processing fraudulent transactions; • violations by us of applicable privacy and other laws; • financial loss to us or to our clients, vendors, counterparties or employees; 11 • loss of confidence in our cyber security measures; • dissatisfaction among our clients or counterparties; • significant exposure to litigation and regulatory fines, penalties or other sanctions; and • harm to our reputation.
The loss of these individuals may have a material adverse effect on our future operations. 24 We may incur losses if our risk management and business continuity strategies, models and processes are not fully effective in mitigating our risk exposures in all market environments or against all types of risk.
The loss of these individuals may have a material adverse effect on our future operations. We may incur losses if our risk management and business continuity strategies, models and processes are not fully effective in mitigating our risk exposures in all market environments or against all types of risk.
We rely on the ability of our employees, our consultants, our internal systems and third-party systems to operate our different businesses and process a high volume of transactions. Unusually high trading volumes or site usage could cause our systems to operate at an unacceptably slow speed or even fail.
We rely on the ability of our employees, our consultants, our internal 12 systems and third-party systems to operate our different businesses and process a high volume of transactions. Unusually high trading volumes or site usage could cause our systems to operate at an unacceptably slow speed or even fail.
These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the United States, the General Data Protection Regulation (GDPR) in the EU, Canada’s Personal Information Protection and Electronic Documents Act, the Cayman Islands' Data Protection Law, and various other laws.
These include those adopted pursuant to the Gramm-Leach-Bliley Act and 15 the Fair and Accurate Credit Transactions Act of 2003 in the United States, the General Data Protection Regulation (GDPR) in the EU, Canada’s Personal Information Protection and Electronic Documents Act, the Cayman Islands' Data Protection Law, and various other laws.
Our businesses are highly dependent on our ability to process and report, on a daily basis, a large number of transactions across numerous and diverse markets and asset classes in many currencies. Operational efficiency is modeled on 22 defined and strict timelines which present inherent risk.
Our businesses are highly dependent on our ability to process and report, on a daily basis, a large number of transactions across numerous and diverse markets and asset classes in many currencies. Operational efficiency is modeled on defined and strict timelines which present inherent risk.
We are also subject to sanctions, such as regulations and economic sanctions programs administered by the U.S. government, including the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) and the U.S. Department of State, and similar sanctions programs imposed by foreign governments or global or regional multilateral organizations.
We are also subject to sanction regulations, such as regulations and economic sanctions programs administered by the U.S. government, including the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) and the U.S. Department of State, and similar sanctions programs imposed by foreign governments or global or regional multilateral organizations.
Our fund and trust management and administration operations are complex activities and include functions such as recordkeeping and accounting, security pricing, corporate actions processing, compliance with investment restrictions, daily net asset value 20 computations, account reconciliations, and required distributions to fund shareholders.
Our fund and trust management and administration operations are complex activities and include functions such as recordkeeping and accounting, security pricing, corporate actions processing, compliance with investment restrictions, daily net asset value computations, account reconciliations, and required distributions to fund shareholders.
Failure to properly perform operational tasks or the misrepresentation of our services and products could subject us to regulatory sanctions, penalties or litigation and result in reputational damage, liability to clients, and the termination of investment management or administration agreements and the withdrawal of assets under our management.
Failure to properly perform operational tasks or the misrepresentation of our services and products could subject us to regulatory sanctions, penalties 16 or litigation and result in reputational damage, liability to clients, and the termination of investment management or administration agreements and the withdrawal of assets under our management.
Our industry is characterized by the existence of a large number of trade secrets, copyrights and the rapid issuance of patents, as well as frequent litigation based on allegations of infringement or other violations of intellectual property rights of others.
Our industry is characterized by the existence of a large number of trade secrets, copyrights and the rapid issuance of patents, as well as frequent litigation based on allegations of infringement or other violations of intellectual property (IP) rights of others.
Consequently, LSV's contribution to our 15 earnings through our minority ownership, as well as to our operating cash flows through LSV's partnership distribution payments, could be adversely affected. Consolidation within our target markets may affect our business .
Consequently, LSV's contribution to our earnings through our minority ownership, as well as to our operating cash flows through LSV's partnership distribution payments, could be adversely affected. Consolidation within our target markets may affect our business .
Financial technology companies and other non-traditional competitors may not be subject to banking regulation, or may be supervised by a national or state regulatory agency that does not have the same resources or regulatory priorities as those regulatory agencies that supervise more diversified financial services firms such as us, or the financial services regulatory framework in a particular jurisdiction may favor financial institutions that are based in that jurisdiction.
Furthermore, these financial technology companies and other non-traditional competitors may not be subject to banking regulation, or may be supervised by a national or state regulatory agency that does not have the same resources or regulatory priorities as those regulatory agencies that supervise more diversified financial services firms such as us, or the financial services regulatory framework in a particular jurisdiction may favor financial institutions that are based in that jurisdiction.
To the extent that our clients choose to invest in products that we do not currently offer, we will suffer outflows and a loss of management fees.
To the extent that our clients choose to invest in products that we do not currently offer, we will suffer outflows and a loss of 13 management fees.
We rely on third parties we do not control to provide us with products and services, including software development, licensed software, software as a service, cloud services, hosting, web hosting, and the Automated Clearing House (ACH) network which transmit transaction data, process chargebacks and refunds, and perform clearing services in connection with our settlement activities.
We rely on third parties we do not control to provide us with products and services, including software development, licensed software, software as a service, business process outsourcing services, cloud services, hosting, web hosting, and the Automated Clearing House (ACH) network, which transmit transaction data, process chargebacks and refunds, and perform clearing services in connection with our settlement activities.
These types of differences in regulatory status and framework may result in losing market share to competitors that have a lower cost of compliance due to being less regulated than we are or not subject to regulation, especially with respect to unregulated financial products.
These types of differences in capabilities and regulatory status may result in losing market share to competitors that have a lower cost of compliance due to being less regulated than we are or not subject to regulation, especially with respect to unregulated financial products.
Further, the software underlying our services may contain undetected errors or defects when first introduced or when new versions are released. We may also experience difficulties in installing or integrating our technology on systems or with other programs used by our clients.
Further, the software underlying our services may contain undetected errors, vulnerabilities or defects when first introduced or when new versions are released. We may also experience difficulties in installing, integrating or supporting our technology on systems or with other programs used by our clients.
This risk also includes contractual and commercial risk, such as the risk that a counterparty’s performance obligations will be unenforceable. It also includes compliance with privacy, anti-money laundering, anti-corruption and terrorist financing rules and regulations.
This risk also includes contractual and commercial risk, such as the risk that a counterparty’s performance 14 obligations will be unenforceable. It also includes compliance with privacy, anti-money laundering (AML), anti-corruption and terrorist financing rules and regulations.
In addition to the growing sophistication of certain parties, the commoditization of cyber tools which are able to be weaponized by less sophisticated actors has led to an increase in the exploitation of technological vulnerabilities.
In addition to the growing sophistication of certain parties, the commoditization of AI and cyber tools which are able to be weaponized by less sophisticated actors has led to an increase in the exploitation of technological vulnerabilities.
The failure to upgrade or maintain our computer systems, software and networks could also make us susceptible to breaches and unauthorized access and misuse. We may be required to expend significant additional resources to modify, investigate or remediate vulnerabilities or other exposures arising from data and cyber security risks.
The failure to upgrade or maintain our technology infrastructure including our, computer systems, software and networks could also make us susceptible to breaches, unauthorized access and misuse. We may be required to expend significant additional resources to modify, investigate or remediate vulnerabilities or other exposures arising from data and cyber security risks.
Many aspects of our businesses are subject to legal requirements concerning the use and protection of certain customer information. These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the U.S., as well as the privacy and cybersecurity laws referenced above.
Many aspects of our businesses are subject to legal requirements concerning the use and protection of certain customer information. These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the United States, as well as the privacy and cybersecurity laws referenced above.
New products often must be in the market place for three or more years in order to generate track records required to attract significant asset inflows.
New products often must be in the marketplace for three or more years in order to generate track records required to attract significant asset inflows.
The financial services industry faces substantial regulatory risks and litigation. Like many firms operating within the financial services industry, we are experiencing a difficult and continuously evolving regulatory environment across our markets.
The financial services industry faces substantial regulatory risks and litigation. Like many firms operating within the financial services industry, we are experiencing a difficult and continuously evolving regulatory environment across our markets and jurisdictions in which we operate.
And, in certain investment programs, a portion of our clients’ cash is swept into insured deposit accounts at third party banks on which we earn fees, which fees may be significant. A material change in interest rates could affect our profitability.
And, in certain investment programs, a portion of our clients’ cash is swept into insured deposit accounts at third party banks on which we earn fees, which fees may be significant. A material change in interest rates or a significant number of clients opting out of these programs could affect our profitability.
Our reputation, business, financial performance, and growth could be adversely affected if stakeholders react negatively to the targets or 26 goals that we set, or if our ESG-related data, processes, and reporting are incomplete or inaccurate, or if we fail to achieve progress with respect to ESG targets or goals. Item 1B. Unresolved Staff Comments. None.
Our reputation, business, financial performance, and growth could be adversely affected if stakeholders react negatively to the targets or goals that we set, or if our ESG-related data, processes, and reporting are incomplete or inaccurate, or if we fail to achieve progress with respect to ESG targets or goals.
If we become subject to such stockholder activism efforts, it could result in substantial costs and a diversion of management's attention and resources, which could harm our business and adversely affect the market price of our common stock.
The costs and diversion of management attention could be more substantial, and the impact on stock prices more pronounced. If we become subject to such stockholder activism efforts, it could result in substantial costs and a diversion of management's attention and resources, which could harm our business and adversely affect the market price of our common stock.
Compliance with existing and future regulations, responding to and complying with regulatory activity (new requirements, examinations and supervisory activity) affecting our financial intermediary clients and their service providers could have a significant impact on our operations or business or our ability to provide certain products or services.
Compliance with existing and future regulations, responding to and complying with regulatory activity (new requirements, examinations and supervisory activity) affecting our financial intermediary clients and their service providers could have a significant impact on our operations or business or our ability to provide certain products or services or could adversely impact a portfolio’s ability to achieve its investment strategies or make certain investments.
We also receive partnership distribution payments from LSV on a quarterly basis which contribute to our operating cash flows. LSV is a registered investment advisor that provides investment advisory services to institutions, including pension plans and investment companies.
We maintain a minority ownership interest in LSV which is a significant contributor to our earnings. We also receive partnership distribution payments from LSV on a quarterly basis which contribute to our operating cash flows. LSV is a registered investment advisor that provides investment advisory services to institutions, including pension plans and investment companies.
Growth of our business could increase costs and regulatory risks. Providing a platform for new businesses, integrating acquired businesses, and partnering with other firms involve a number of risks and present financial, managerial, and operational challenges.
Growth of our business could increase costs and regulatory risks. Providing platforms for existing and new businesses, expanding our operational services, integrating acquired businesses, and partnering with other firms involves a number of risks and present financial, managerial, and operational challenges.
In the event of a breakdown or improper operation of a direct or indirect third-party’s systems or processes, or improper or unauthorized action by third parties, including consultants and subcontractors, we could suffer financial loss, a disruption of our businesses, regulatory sanctions or damage to our reputation.
In the event of a breakdown or improper operation of a direct or indirect third-party’s systems or processes, or improper or unauthorized action by third parties, including consultants and subcontractors, we could suffer financial loss, a disruption of our businesses, regulatory sanctions or damage to our reputation. We are at risk of failing to keep pace with significant new technologies.
Further, if, due to changes in investor sentiment or the relative performance of certain asset classes or otherwise, clients invest in products that generate lower fees, our investment management business could be adversely affected. Our investment advisory contracts may be terminated or may not be renewed on favorable terms .
Further, if, due to changes in investor sentiment or the relative performance of certain asset classes or otherwise, clients invest in products that generate lower fees, our investment management business could be adversely affected.
It is possible that potential conflicts could give rise to litigation or enforcement actions, which may lead to our clients being less willing to enter into transactions in which a conflict may occur and could adversely affect our businesses and reputation. Our investment management operations may subject us to legal liability for client losses.
It is possible that potential conflicts could give rise to litigation or enforcement actions, which may lead to our clients being less willing to enter into transactions in which a conflict may occur and could adversely affect our businesses and reputation.
In connection with our ongoing operations, we utilize the services of third-party suppliers, which we anticipate will continue and may increase in the future. These services include, for example, outsourced development, processing and support functions, and other professional services. Third-party financial entities and technology systems upon which we rely are becoming more interdependent and complex.
We are dependent upon third-party service providers in our operations. In connection with our ongoing operations, we utilize the services of third-party suppliers, which we anticipate will continue and may increase in the future. These services include, for example, outsourced development, processing and support functions, and other professional services.
We are subject to the risk of loss, or of harm to our reputation, resulting from manual, inadequate or failed processes or systems. We are exposed to operational risk across the full scope of our business activities, including revenue-generating activities (e.g., sales and trading) and support and control groups (e.g., information technology, accounting systems and trade processing).
We are exposed to operational risk across the full scope of our business activities, including revenue-generating activities (e.g., sales and trading) and support and control groups (e.g., information technology, accounting systems and trade processing).
A successful assertion by others of infringement claims or a failure to maintain the confidentiality and exclusivity of our intellectual property may have a material adverse effect on our business and financial results. We are dependent upon third-party service providers in our operations.
A successful assertion by others of infringement claims or a failure to maintain the confidentiality and exclusivity of our intellectual property may have a material adverse effect on our business and financial results.
These business activities could expose us to new and enhanced risks, greater regulatory scrutiny of these activities, increased credit-related, political and operational risks, and reputational concerns regarding the manner in which these assets are being administered or held. We are exposed to operational risks .
These business activities could expose us to new and enhanced risks, greater regulatory scrutiny of these activities, increased credit-related, political and operational risks, and reputational concerns regarding the manner in which these assets are being administered or held. These risks could result in decreased earnings and harm to our competitive position in the investment management industry.
Further, if we fail to deliver products and services which are of sound economic value to our clients and our target markets, or are unable to support the product in a cost-effective and compliant manner, we may face reputational damage and incur significant financial losses. 14 We rely on third parties to provide products and services that may be difficult to replace or which could cause errors or failures in the services we provide.
Further, if we fail to deliver products and services which are of sound economic value to our clients and our target markets, or are unable to support the product in a cost-effective and compliant manner, we may face reputational damage and incur significant financial losses.
Increased geopolitical unrest and other events could adversely affect the global economy or specific international, regional and domestic markets, which may cause our revenue and earnings to decline.
Increased geopolitical unrest and other events could adversely affect the global economy or specific international, regional and domestic markets, which may cause our revenue and earnings to decline. Global conflicts and tensions continue to pose significant risks to the financial services industry and our operations.
We believe price competition and pricing pressures in these and other areas will continue as investors continue to reduce the amounts they are willing to pay and financial services firms seek to obtain market share by reducing fees or margins.
We believe price competition and pricing pressures in these and other areas will continue as investors continue to reduce the amounts they are willing to pay and financial services firms seek to obtain market share by reducing fees or margins. The competitive landscape is rapidly evolving with the entry of fintech firms and big tech companies into asset management.
A restriction on our ability to fully utilize our Credit Facility may negatively affect our operating results, liquidity and financial condition. We may become subject to stockholder activism efforts that each could cause material disruption to our business.
A restriction on our ability to fully utilize our Credit Facility may negatively affect our operating results, liquidity and financial condition. We may become subject to stockholder activism efforts that each could cause material disruption to our business. Industry trends indicate activists are targeting operational enhancements and strategic demands, with a notable increase in CEO scrutiny.
Although we employ backup systems for our data, those backup systems may be unavailable following a disruption, the affected data may not have been backed up or may not be recoverable from the backup, or the backup data may be costly to recover, which could adversely affect our business.
Although we employ backup systems for our data, those backup systems may be unavailable following a disruption, the affected data may not have been backed up or may not be recoverable from the backup, or the backup data may be costly to recover, which could adversely affect our business. 20 We may incur losses as a result of unforeseen or catastrophic events, including the emergence of a pandemic, extreme weather events or other natural disasters.
For example, in recent years, there has been significant consolidation among clearing agents, exchanges and clearing houses and increased interconnectivity of multiple financial institutions with central agents, exchanges and clearing houses.
Third-party financial entities and technology systems upon which we rely are becoming more interdependent and complex. For example, in recent years, there has been significant consolidation among clearing agents, exchanges and clearing houses and increased interconnectivity of multiple financial institutions with central agents, exchanges and clearing houses.
Examinations or investigations could result in the identification of matters that may require remediation activities or enforcement proceedings by the regulator. The direct and indirect costs of responding to these examinations, or of defending ourselves in any enforcement investigation or litigation could be significant. Additionally, actions brought against us may result in settlements, awards, injunctions, fines and penalties.
This shift in regulatory focus may require substantial investments in advanced technologies and specialized expertise to ensure compliance. The direct and indirect costs of responding to these examinations, undertaking remediation activities or of defending ourselves in any enforcement investigation or litigation could be significant. Additionally, actions brought against us may result in settlements, awards, injunctions, fines, penalties and operational changes.
Our businesses could be materially and adversely affected by a significant operational breakdown or failure, theft, fraud or other unlawful conduct, 23 or other negative outcomes caused by poor judgement, human error or misconduct on the part of one of our employees or contractors or those of a third party on which our operations rely.
Should we experience any significant operational breakdown or failure, theft, fraud or other unlawful conduct, or other negative outcomes caused by poor judgment, human error or misconduct on the part of one of our employees or contractors or those of a third party on which our operations rely, we could suffer significant financial loss, regulatory sanctions or damage to our reputation.
Additionally, we may introduce new products or services or change processes or reporting, including in connection with new regulatory requirements, resulting in new operational risk that we may not fully appreciate or identify.
Additionally, we may introduce new products or services or change processes or reporting, including in connection with new regulatory requirements, resulting in new operational risk that we may not fully appreciate or identify. The expansion of our GCC and the outsourcing of technology and global operations functions currently performed onshore introduce additional risks.
These new investment products and technological innovations available to both institutional and retail investors have led to a general trend towards lower fees in some segments of the investment management industry.
Companies that successfully implement artificial intelligence (AI)-driven pricing could gain a significant advantage in optimizing revenues and responding to market dynamics. These new investment products and technological innovations, available to both institutional and retail investors, have led to a general trend towards lower fees in some segments of the investment management industry.
The frequency and scope of regulatory reform in the current regulatory environment may lead to an increase in fees and assessments resulting in increased expense, or an increase or change in regulatory requirements which could affect our operations and business. A failure to address conflicts of interest appropriately could adversely affect our business and reputation.
The frequency and scope of regulatory reform in the current regulatory environment may lead to an increase in fees, assessments and operational restrictions resulting in increased expense, or an increase or change in regulatory requirements which could affect our operations and business. Moreover, maintaining adequate staffing levels to address these evolving regulatory demands presents an ongoing challenge.
Product development in the asset management arena has had significant growth in newer areas where investment criteria and performance metrics have not yet been fully defined or developed, such as Environmental, Social and Governance, or “ESG” products, Sustainable Investing products, and Tax Harvesting programs.
Failure to effectively manage the risks associated with these new products could lead to reputational damage, regulatory scrutiny, and potential financial losses. Product development in the asset management arena has had significant growth in newer areas where investment criteria and performance metrics have not yet been fully defined or developed, such as Tax Harvesting programs.
We derive a substantial portion of our revenue from providing investment advisory services.
Our investment advisory contracts may be terminated or may not be renewed on favorable terms . We derive a substantial portion of our revenue from providing investment advisory services.
We are exposed to risk of the disclosure and misuse of personal data. We store and process large amounts of personally identifiable information of our customers.
We store, transfer and process large amounts of personally identifiable information of our customers to deliver our products and services.
Our ability to operate our businesses efficiently and profitably, and to offer products and services that meet the expectations of our clients, is highly dependent on the competence and trustworthiness of our employees and contractors, as well as those of third parties on which our operations rely, including vendors, custodians and financial intermediaries.
Our operations rely on the competence and trustworthiness of our employees and consultants, as well as of our contractors and third parties, including vendors, custodians and financial intermediaries.
Notwithstanding evolving technology and technology-based risk and control systems, our products and services ultimately rely on people, including our employees and those of third-parties with which we conduct business.
The distance and potential cultural differences may also complicate communication and oversight, potentially leading to missed deadlines or mistakes that could subject us to claims or regulatory scrutiny. 18 Notwithstanding evolving technology and technology-based risk and control systems, our products and services ultimately rely on people, including our employees and those of third-parties with which we conduct business.
In addition, although we maintain insurance coverage that may, subject to policy terms and conditions, cover certain aspects of cyber and information security risks, such insurance coverage may be insufficient to cover all losses. The cost of managing cyber and information security risks and attacks along with complying with new and increasingly expansive regulatory requirements could adversely affect our business.
In addition, although we maintain insurance coverage that may, subject to policy terms and conditions, cover certain aspects of cyber and information security risks, such insurance coverage may be insufficient to cover all losses. Certain regulatory requirements, while aimed at enhancing cybersecurity, significantly restrict our ability to allocate resources based solely on our own risk assessments.
These restrictions could inhibit our development or marketing of certain products or services, or increase the costs of offering them to customers. The fees and assessments imposed on our regulated subsidiaries by federal, national, state and foreign regulatory authorities could have a significant impact on us.
These restrictions could inhibit our development or marketing of certain products or services, or increase the costs of offering them to customers. Compliance with existing and emerging regulations, as well as responding to regulatory examinations and supervisory activities, continues to have a significant impact on our operations globally.
We may be unable to fully capture the expected value from acquisitions, divestitures, joint ventures, minority stakes or strategic alliances.
Failure to adequately address these emerging regulatory priorities could result in significant financial and reputational damage Risks Related to Our Business Generally We may be unable to fully capture the expected value from acquisitions, divestitures, joint ventures, minority stakes or strategic alliances.
This may create conflicts across our global business, which could impact our competitiveness in the market and damage our reputation resulting in a material adverse effect on our business. We may, from time to time, communicate certain initiatives, targets, or goals regarding environmental matters, diversity, responsible sourcing, or other ESG matters.
The lack of global harmonization in ESG laws and regulations has led to fragmentation across jurisdictions, creating conflicts across global businesses and potentially impacting competitiveness and reputation. We may, from time to time, communicate certain initiatives, targets, or goals regarding environmental matters, diversity, responsible sourcing, or other ESG matters.
Our overall profitability would be negatively affected if investments and expenses associated with such growth are not matched or exceeded by the revenues that are derived from such investment or growth. Expansion may also create a need for additional compliance, risk management and internal control procedures, and often involves the hiring of additional personnel to monitor such procedures.
Our overall profitability would be negatively affected if investments and expenses associated with such growth are not matched or exceeded by the revenues that are derived from such investment or growth. As we expand our business-to-consumer offerings, we face heightened cybersecurity and fraud risks.
For example, when adopting rules that are intended to implement a global regulatory standard, a national regulator may introduce additional or more restrictive requirements, which can create competitive disadvantages for financial services firms such as ours that are subject to those enhanced regulations as a consequence of multi-jurisdictional operations.
For example, regulations like the EU's Digital Operational Resilience Act (DORA) are intended to implement a global regulatory standard, may introduce additional or more restrictive requirements for non-EU affiliates, which can create competitive disadvantages for multi-jurisdictional operations. In addition, the regulatory environment is increasingly influenced by geopolitical factors and technological advancements.
We have experienced and will likely continue to experience competitive pressures in these and other areas in the future. Our earnings and cash flows are affected by the performance of LSV. We maintain a minority ownership interest in LSV which is a significant contributor to our earnings.
We have experienced and will likely continue to experience competitive pressures in these and other areas in the future. Our outsourcing strategy may affect our business operations and financial performance. We have recently implemented a new outsourcing strategy that leverages a Global Capability Center (GCC) in India.
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Substantial risk and uncertainties are associated with the introduction of new products and services, including the implementation of new and appropriate operational controls and procedures, shifting client and market preferences, the introduction of competing products or services and compliance with regulatory requirements.
Added
The implementation of many product innovation and development opportunities, particularly cloud-based solutions, requires us to obtain client consent and/or vendor consent, which may be withheld or be obtainable only if we incur a cost that is disproportionate to the revenue opportunity.
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Given our global footprint and the high volume of transactions we process, the large number of clients, partners, vendors and counterparties with which we do business, and the increasing sophistication of cyber-attacks, a cyber-attack or information security breach could occur and persist for an extended period of time without detection.
Added
Expansion of Business-to-Consumer products and services presents unique risks as it increases direct interaction with individual consumers, exposing us to heightened cybersecurity threats and data privacy concerns. Growth in Business-to-Consumer models may increase operational risk due to higher transaction volumes, potentially increasing operational costs and fraud risks.
Removed
Risks Related to Our Business Generally If our management fails to develop and execute effective business strategies, and to anticipate changes affecting those strategies, our results could suffer. Our business strategies significantly affect our results of operations.
Added
Product development in the asset management arena has experienced significant growth in alternative investments, including private equity, hedge funds, real estate, and infrastructure.
Removed
These strategies relate to: • the products and services we offer; • the geographies in which we operate; • the types of clients we serve; • the counterparties with which we do business; and • the manner in which we deploy our capital resources to take advantage of perceived opportunity in the short and long-term.
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The growing focus on alternatives reflects increasing demand for diversification beyond traditional asset classes; however, new alternative products often require three or more years in the market to generate the track records necessary to attract significant asset inflows.
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If management makes choices about these strategies and goals that prove to be incorrect, do not accurately assess the competitive landscape, the head winds and tailwinds affecting our business, or fail to address changing regulatory and market environments, then our growth prospects may suffer and our earnings could decline.
Added
In addition, alternatives 8 present significant operational challenges for asset managers, primarily due to the lack of widely adopted and trusted technological solutions in this space. Unlike traditional investments, which benefit from well-established operational infrastructures and automated processes, alternative investments often require more manual intervention and bespoke operational support.
Removed
Our growth and prospects also depend on management’s ability to develop and execute effective business plans to address these strategic priorities, both in the near term and over longer time horizons. Management’s effectiveness in this regard will affect our ability to develop and enhance our resources, control expenses and return capital to shareholders.
Added
We rely on third parties to provide products and services that may be difficult to replace or which could cause errors or failures in the services we provide.
Removed
Each of these objectives could be adversely affected by any failure on the part of management to: • devise effective business plans and strategies; • effectively implement business decisions; • institute controls that appropriately address the risks associated with business activities and any changes in those activities; • offer products and services that are appropriately priced, meet the changing expectations of clients and customers and are delivered in ways that enhance client satisfaction; • allocate capital in a manner that promotes long-term stability to enable us to build and invest in market-leading technologies and products, even in a highly-stressed environment; • adequately respond to regulatory requirements; • appropriately address shareholder concerns; • react quickly to changes in market conditions or market structures, or • develop and enhance the operational, technology, risk, financial and managerial resources necessary to grow and manage our business. 21 Additionally, our Board of Directors plays an important role in exercising appropriate oversight of management’s strategic decisions, and a failure by our Board of Directors to perform this function could also impair our results of operations.
Added
Our ability to compete effectively against these new entrants, who may have superior technological capabilities, is crucial for maintaining market share.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn 27 addition, we leverage our Third Party Risk Management, Insider Threats, Business Continuity & Disaster Recovery and Information Governance programs to supplement our Cybersecurity Program; and • Privacy Oversight: In addition to our Enterprise Risk Management functions, our Legal and Compliance team maintains a privacy risk management program to assess, manage and report privacy risks related to how we are collecting, using, sharing, and storing user data.
Biggest changeIn addition, we leverage our Third Party Risk Management, Insider Threats, Business Continuity and Disaster Recovery programs to supplement our Cybersecurity Program; and • Privacy Oversight: In addition to our Enterprise Risk Management functions, our Legal and Compliance team maintains a privacy risk management program to assess, manage and report privacy risks related to how we are collecting, using, sharing, and storing user data.
In addition to the CISO’s cybersecurity experience, he has certifications in risk and information systems control along with information systems auditing; • Cybersecurity Controls: We have implemented what we believe are appropriate preventative measures to protect SEI’s infrastructure, systems, and data.
In addition to the CISO’s cybersecurity experience, he has certifications in risk and information systems control along with information systems auditing; 22 • Cybersecurity Controls: We have implemented what we believe are appropriate preventative measures to protect SEI’s infrastructure, systems, and data.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Our corporate headquarters is located in Oaks, Pennsylvania and consists of ten buildings situated on approximately 134 acres. We own and operate the land and buildings, which encompass approximately 628,000 square feet of office space and 34,000 square feet of data center space. We lease other offices which aggregate 155,000 square feet.
Biggest changeItem 2. Properties. Our corporate headquarters is located in Oaks, Pennsylvania and consists of ten buildings situated on approximately 134 acres. We own and operate the land and buildings, which encompass approximately 628,000 square feet of office space and 34,000 square feet of data center space. We lease other offices which aggregate 182,000 square feet.
Removed
We also own a 3,400 square foot condominium that is used for business purposes in New York, New York.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings. The Company is party to various disputes, actions and claims arising in the normal course of business that the Company does not believe are material.
Biggest changeItem 3. Legal Proceedings. We and certain of our subsidiaries are a party to or have property subject to litigation and other proceedings, examinations and investigations that arise in the ordinary course of our business that we do not believe are material.
Removed
The Company believes that the ultimate resolution of any of these matters will not have a material adverse effect on the Company's financial position or the manner in which the Company conducts its business. Currently, the Company does not believe the amount of losses associated with these matters can be estimated.
Added
These types of matters could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief.
Removed
While the Company does not believe that the amount of such losses will, when liquidated or estimable, be material to its financial position, the assumptions may be incorrect and any such loss could have a material adverse effect on the Company's results of operations or the manner in which the Company conducts its business in the period(s) during which the underlying matters are resolved.
Added
We believe the probability is remote that the outcome of any of these matters will have a material adverse effect on SEI as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings in any particular interim reporting period. We cannot predict the outcome of legal or other proceedings with certainty.
Added
These matters include the proceedings summarized in “Note 10. Commitments and Contingencies” included in our Notes to Consolidated Financial Statements.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOur Board of Directors intends to declare future dividends on a semiannual basis. 2023 High Low Dividends First Quarter $ 64.69 $ 53.93 $ — Second Quarter 59.87 56.10 0.43 Third Quarter 64.43 58.25 — Fourth Quarter 64.94 52.20 0.46 2022 High Low Dividends First Quarter $ 64.29 $ 54.03 $ — Second Quarter 61.43 51.34 0.40 Third Quarter 58.96 48.90 — Fourth Quarter 63.49 46.30 0.43 According to the records of our transfer agent, there were 202 holders of record of our common stock on January 31, 2024.
Biggest changeOur Board of Directors intends to declare future dividends on a semiannual basis. 2024 High Low Dividends First Quarter $ 72.54 $ 61.58 $ — Second Quarter 71.81 63.66 0.46 Third Quarter 70.16 62.38 — Fourth Quarter 87.25 68.56 0.49 2023 High Low Dividends First Quarter $ 64.69 $ 53.93 $ — Second Quarter 59.87 56.10 0.43 Third Quarter 64.43 58.25 — Fourth Quarter 64.94 52.20 0.46 According to the records of our transfer agent, there were 194 holders of record of our common stock on December 31, 2024.
ASSUMES $100 INVESTED ON DECEMBER 31, 2018 ASSUMES DIVIDENDS REINVESTED FISCAL YEAR ENDED DECEMBER 31, Issuer Purchases of Equity Securities: Our Board of Directors has authorized the repurchase of up to $5.578 billion worth of our common stock. Currently, there is no expiration date for our common stock repurchase program (See Note 7 to the Consolidated Financial Statements).
ASSUMES $100 INVESTED ON DECEMBER 31, 2019 ASSUMES DIVIDENDS REINVESTED FISCAL YEAR ENDED DECEMBER 31, Issuer Purchases of Equity Securities: Our Board of Directors has authorized the repurchase of up to $6.228 billion worth of our common stock. Currently, there is no expiration date for our common stock repurchase program (See Note 7 to the Consolidated Financial Statements).
For information on our equity compensation plans, refer to Note 7 to the Consolidated Financial Statements and Item 12 of this Annual Report on Form 10-K. 29 Stock Performance Graph : The following graph shows a comparison from December 31, 2018 through December 31, 2023 of the cumulative total return for our common stock, the NASDAQ Market Index and an Industry Index, a blend of indices including 79% NASDAQ US Asset Managers and Custodians and 21% NASDAQ US Software.
Shareholders' Equity" included in our Notes to Consolidated Financial Statements and Item 12 of this Annual Report on Form 10-K. 24 Stock Performance Graph : The following graph shows a comparison from December 31, 2019 through December 31, 2024 of the cumulative total return for our common stock, the NASDAQ Market Index and an Industry Index, a blend of indices including 79% NASDAQ US Asset Managers and Custodians and 21% NASDAQ US Software.
Because many of such shares are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.
Because many of such shares are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders. For information on our equity compensation plans, refer to "Note 7.
On December 15, 2023, our Board of Directors approved an increase in the stock repurchase program by an additional $250.0 million.
On October 22, 2024, our Board of Directors approved an increase in the stock repurchase program by an additional $400.0 million.
Information regarding the repurchase of common stock during the three months ended December 31, 2023 is: Period Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program October 2023 175,000 $ 53.58 175,000 $ 91,628,000 November 2023 625,000 56.89 625,000 56,069,000 December 2023 387,000 61.41 387,000 282,079,000 Total 1,187,000 57.88 1,187,000 (1) Average price paid per share does not include excise tax on stock repurchases.
Information regarding the repurchase of common stock during the three months ended December 31, 2024 is: Period Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program October 2024 175,000 $ 75.59 175,000 $ 415,871,000 November 2024 572,000 79.54 572,000 370,390,000 December 2024 2,364,000 84.24 2,364,000 169,600,000 Total 3,111,000 82.89 3,111,000 (1) Average price paid per share does not include excise tax on stock repurchases.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeAverage Asset Balances (In millions) For the Year Ended December 31, Percent Change Percent Change 2023 2022 2021 Private Banks: Equity and fixed-income programs $ 23,638 $ 23,326 1 % $ 25,857 (10) % Collective trust fund programs 6 7 (14) % 6 17 % Liquidity funds 3,537 3,834 (8) % 4,019 (5) % Total assets under management $ 27,181 $ 27,167 — % $ 29,882 (9) % Client assets under administration 4,976 4,204 18 % 4,451 (6) % Total assets $ 32,157 $ 31,371 3 % $ 34,333 (9) % Investment Advisors: Equity and fixed-income programs $ 68,407 $ 70,394 (3) % $ 77,596 (9) % Liquidity funds 4,960 5,682 (13) % 3,509 62 % Total Platform assets under management $ 73,367 $ 76,076 (4) % $ 81,105 (6) % Platform-only assets 16,026 13,574 18 % 13,426 1 % Platform-only assets-deposit program 70 — NM — NM Total Platform assets $ 89,463 89,650 — % 94,531 (5) % Institutional Investors: Equity and fixed-income programs $ 74,546 $ 79,415 (6) % $ 91,832 (14) % Collective trust fund programs 4 5 (20) % 44 (89) % Liquidity funds 1,636 1,939 (16) % 2,609 (26) % Total assets under management $ 76,186 $ 81,359 (6) % $ 94,485 (14) % Advised assets 4,479 4,330 3 % 4,533 (4) % Total assets $ 80,665 $ 85,689 (6) % $ 99,018 (13) % Investment Managers: Collective trust fund programs (A) 148,097 125,595 18 % 85,622 47 % Liquidity funds 261 311 (16) % 496 (37) % Total assets under management $ 148,358 $ 125,906 18 % $ 86,118 46 % Client assets under administration 875,369 837,647 5 % 850,510 (2) % Total assets $ 1,023,727 $ 963,553 6 % $ 936,628 3 % Investments in New Businesses: Equity and fixed-income programs $ 2,053 $ 1,968 4 % $ 1,906 3 % Liquidity funds 205 247 (17) % 202 22 % Total assets under management $ 2,258 $ 2,215 2 % $ 2,108 5 % Advised assets 1,089 1,191 (9) % 1,395 (15) % Total assets $ 3,347 $ 3,406 (2) % $ 3,503 (3) % LSV: Equity and fixed-income programs (B) $ 85,661 $ 87,220 (2) % $ 99,591 (12) % 37 Total: Equity and fixed-income programs (C) $ 254,305 $ 262,323 (3) % 296,782 (12) % Collective trust fund programs 148,107 125,607 18 % 85,672 47 % Liquidity funds 10,599 12,013 (12) % 10,835 11 % Total assets under management $ 413,011 $ 399,943 3 % $ 393,289 2 % Advised assets 5,568 5,521 1 % 5,928 (7) % Client assets under administration (D) 880,345 841,851 5 % 854,961 (2) % Platform-only assets 16,096 13,574 19 % 13,426 1 % Total assets $ 1,315,020 $ 1,260,889 4 % $ 1,267,604 (1) % (A) Collective trust fund program average assets are included in assets under management since SEI is the trustee.
Biggest changeAverage Asset Balances (In millions) For the Year Ended December 31, Percent Change Percent Change 2024 2023 2022 Investment Managers: Collective trust fund programs (A) $ 187,604 $ 148,097 27 % $ 125,595 18 % Liquidity funds 226 261 (13) % 311 (16) % Total assets under management $ 187,830 $ 148,358 27 % $ 125,906 18 % Client assets under administration (E) 990,305 859,596 15 % 821,256 5 % Total assets $ 1,178,135 $ 1,007,954 17 % $ 947,162 6 % Private Banks: Equity and fixed-income programs $ 25,336 $ 23,638 7 % $ 23,326 1 % Collective trust fund programs 5 6 (17) % 7 (14) % Liquidity funds 3,077 3,537 (13) % 3,834 (8) % Total assets under management $ 28,418 $ 27,181 5 % $ 27,167 — % Client assets under administration 8,027 4,976 61 % 4,204 18 % Total assets $ 36,445 $ 32,157 13 % $ 31,371 3 % Investment Advisors: Equity and fixed-income programs $ 75,115 $ 68,407 10 % $ 70,394 (3) % Liquidity funds 4,073 4,960 (18) % 5,682 (13) % Total Platform assets under management $ 79,188 $ 73,367 8 % $ 76,076 (4) % Platform-only assets 22,100 16,026 38 % 13,574 18 % Platform-only assets-deposit program 1,274 70 NM — NM Total Platform assets $ 102,562 89,463 15 % 89,650 — % Institutional Investors: Equity and fixed-income programs $ 76,622 $ 74,546 3 % $ 79,415 (6) % Collective trust fund programs 1 4 (75) % 5 (20) % Liquidity funds 1,976 1,636 21 % 1,939 (16) % Total assets under management $ 78,599 $ 76,186 3 % $ 81,359 (6) % Client assets under advisement 7,231 4,479 61 % 4,330 3 % Total assets $ 85,830 $ 80,665 6 % $ 85,689 (6) % Investments in New Businesses: Equity and fixed-income programs $ 2,421 $ 2,053 18 % $ 1,968 4 % Liquidity funds 375 205 83 % 247 (17) % Total assets under management $ 2,796 $ 2,258 24 % $ 2,215 2 % Client assets under advisement 1,801 1,089 65 % 1,191 (9) % Client assets under administration (E) 14,949 15,773 (5) % 16,391 (4) % Total assets $ 19,546 $ 19,120 2 % $ 19,797 (3) % LSV: Equity and fixed-income programs (B) $ 90,908 $ 85,661 6 % $ 87,220 (2) % 33 Total: Equity and fixed-income programs (C) $ 270,402 $ 254,305 6 % 262,323 (3) % Collective trust fund programs 187,610 148,107 27 % 125,607 18 % Liquidity funds 9,727 10,599 (8) % 12,013 (12) % Total assets under management $ 467,739 $ 413,011 13 % $ 399,943 3 % Client assets under advisement 9,032 5,568 62 % 5,521 1 % Client assets under administration (D) 1,013,281 880,345 15 % 841,851 5 % Platform-only assets 23,374 16,096 45 % 13,574 19 % Total assets $ 1,513,426 $ 1,315,020 15 % $ 1,260,889 4 % (A) Collective trust fund program average assets are included in assets under management since SEI is the trustee.
Revenues during 2023 were primarily affected by: • One-time early termination fees of $88.0 million from a significant investment processing client recorded during the first quarter 2022; • A negative adjustment to fees from an investment processing client which reduced their business processed with us through divestment; • Reduced investment processing fees earned on our mutual fund trading solution; and • Lower investment processing fees from the recontacting of existing clients; partially offset by • Increased investment processing fees from new client conversions; • One-time early termination fees of $10.5 million from an investment processing client acquired by an existing client recorded in second quarter 2023; • Increased revenues from U.K. clients on cash balances due to increased interest rates, and • Increased investment management fees from market appreciation.
Revenues during 2023 were primarily affected by: • One-time early termination fees of $88.0 million from a significant investment processing client recorded during the first quarter 2022; • A negative adjustment to fees from an investment processing client which reduced their business processed with us through divestment; 36 • Reduced investment processing fees earned on our mutual fund trading solution; and • Lower investment processing fees from the recontacting of existing clients; partially offset by • Increased investment processing fees from new client conversions; • One-time early termination fees of $10.5 million from an investment processing client acquired by an existing client recorded in second quarter 2023; • Increased revenues from U.K. clients on cash balances due to increased interest rates, and • Increased investment management fees from market appreciation.
Accordingly, we endeavor to: 33 • automate selected manual processes in our operational, compliance, risk, control and other functions in order to create internal efficiencies; • evolve our cyber-security and data privacy systems to combat known and emerging threats and meet and exceed industry and regulatory standards around the world; • increase the resiliency and reliability of our systems; and • create more efficient technology solutions to scale our various businesses.
Accordingly, we endeavor to: • automate selected manual processes in our operational, compliance, risk, control and other functions in order to create internal efficiencies; • evolve our cyber-security and data privacy systems to combat known and emerging threats and meet and exceed industry and regulatory standards around the world; • increase the resiliency and reliability of our systems; and • create more efficient technology solutions to scale our various businesses.
Operating income during 2023 was primarily affected by: • An increase in revenues; and • Decreased non-capitalized investment spending, mainly consulting costs; partially offset by • Increased costs associated with new business, primarily personnel expenses and third-party vendor costs; 42 • Increased personnel costs due to competitive labor markets; and • The write off of $5.3 million in previously capitalized software development costs.
Operating income during 2023 was primarily affected by: • An increase in revenues; and • Decreased non-capitalized investment spending, mainly consulting costs; partially offset by • Increased costs associated with new business, primarily personnel expenses and third-party vendor costs; • Increased personnel costs due to competitive labor markets; and • The write off of $5.3 million in previously capitalized software development costs.
Critical Accounting Policies and Estimates The accompanying consolidated financial statements and supplementary information were prepared in accordance with accounting principles generally accepted in the United States. Inherent in the application of many of these accounting policies is the need for management to make estimates which require extensive judgments in the determination of certain 47 revenues, expenses, assets and liabilities.
Critical Accounting Policies and Estimates The accompanying consolidated financial statements and supplementary information were prepared in accordance with accounting principles generally accepted in the United States. Inherent in the application of many of these accounting policies is the need for management to make estimates which require extensive judgments in the determination of certain revenues, expenses, assets and liabilities.
We will continue to invest in improving our technology infrastructure in order to maintain the foundation that we believe enables us to best serve our clients’ needs. Investment Processing and Software Servicing Fees Investment processing and software servicing fees in our Private Banks segment primarily include application and business-process-outsourcing services, professional fees and transaction-based services.
We will continue to invest in improving our technology and operational infrastructure in order to maintain the foundation that we believe enables us to best serve our clients’ needs. Investment Processing and Software Servicing Fees Investment processing and software servicing fees in our Private Banks segment primarily include application and business-process-outsourcing services, professional fees and transaction-based services.
Actual operating results and the underlying amount and category of income in future years could render the current assumptions, judgments and estimates of recoverable net deferred taxes inaccurate. Any of the assumptions, judgments and estimates mentioned above could cause actual income tax obligations to differ from the estimates, thus materially impacting our financial position and results of operations.
Actual operating results and the underlying amount and category of income in future years could render the current assumptions, judgments and estimates of recoverable net 44 deferred taxes inaccurate. Any of the assumptions, judgments and estimates mentioned above could cause actual income tax obligations to differ from the estimates, thus materially impacting our financial position and results of operations.
If we are not able to successfully integrate our past and future acquisitions, or we do not fully realize the anticipated benefits, synergies or objectives of these transactions, we may incur additional costs such as impairment charges to goodwill or intangible assets recognized from acquisitions that could adversely affect our results of operations or financial condition. 34 Ending Asset Balances This table presents ending asset balances of our clients, or of our clients’ customers, for which we provide management or administrative services through our subsidiaries and partnerships in which we have a significant interest.
If we are not able to successfully integrate our past and future acquisitions, or we do not fully realize the anticipated benefits, synergies or objectives of these transactions, we may incur additional costs such as impairment charges to goodwill or intangible assets recognized from acquisitions that could adversely affect our results of operations or financial condition. 30 Ending Asset Balances This table presents ending asset balances of our clients, or of our clients’ customers, for which we provide management or administrative services through our subsidiaries and partnerships in which we have a significant interest.
As of January 31, 2024, we had outstanding letters of credit of $4.9 million which reduced the amount available under the credit facility. These letters of credit were primarily issued for the expansion of the corporate headquarters and are due to expire in 2025.
As of January 31, 2025, we had outstanding letters of credit of $4.9 million which reduced the amount available under the credit facility. These letters of credit were primarily issued for the expansion of the corporate headquarters and are due to expire in 2025.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. (In thousands, except share and per-share data) This discussion reviews and analyzes the consolidated financial condition at December 31, 2023 and 2022, the consolidated results of operations for the years ended December 31, 2023, 2022 and 2021, and other factors that may affect future financial performance.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. (In thousands, except share and per-share data) This discussion reviews and analyzes the consolidated financial condition at December 31, 2024 and 2023, the consolidated results of operations for the years ended December 31, 2024, 2023 and 2022, and other factors that may affect future financial performance.
Level 3 financial liabilities at December 31, 2023 and December 31, 2022 consist of contingent considerations resulting from business acquisitions (See Note 15 to the Consolidated Financial Statements). Regulatory Matters Like many firms operating within the financial services industry, we are experiencing a complex and changing regulatory environment across our markets.
Level 3 financial liabilities at December 31, 2024 and December 31, 2023 consist of contingent considerations resulting from business acquisitions (See Note 15 to the Consolidated Financial Statements). 41 Regulatory Matters Like many firms operating within the financial services industry, we are experiencing a complex and changing regulatory environment across our markets.
As of January 31, 2024, the amount of the credit facility available for corporate purposes was $320.1 million. The availability of the credit facility is subject to compliance with certain covenants set forth in the agreement.
As of January 31, 2025, the amount of the credit facility available for corporate purposes was $320.1 million. The availability of the credit facility is subject to compliance with certain covenants set forth in the agreement.
The fair value of all other financial assets are determined using Level 1 or Level 2 inputs and consist mainly of investments in equity or fixed-income mutual funds that are quoted daily and Government National Mortgage Association (GNMA) and other U.S. government agency securities that are single issuer pools that are valued based on current market data of similar assets.
The fair value of all other financial assets are determined using Level 1 or Level 2 inputs and consist mainly of investments in equity or fixed-income investment products that are quoted daily and Government National Mortgage Association (GNMA) and other U.S. government agency securities that are single issuer pools that are valued based on current market data of similar assets.
Goodwill is tested for impairment at the reporting unit level annually or more frequently if events or changes in circumstances would more likely than not reduce the fair value of a reporting unit below its carrying value. We have three reporting units subject to goodwill impairment testing. As of December 31, 2023, no impairment of goodwill has been identified.
Goodwill is tested for impairment at the reporting unit level annually or more frequently if events or changes in circumstances would more likely than not reduce the fair value of a reporting unit below its carrying value. We have four reporting units subject to goodwill impairment testing. As of December 31, 2024, no impairment of goodwill has been identified.
Revenue from Information processing and software servicing fees was positively impacted by new client conversions and growth from existing SEI Wealth Platform SM (SWP) clients during 2023. • Revenue from Assets under management, administration, and distribution fees was favorably impacted by higher assets under administration due to new products and additional services provided to existing alternative investment clients of the Investment Managers segment.
Revenue from Information processing and software servicing fees was positively impacted by new client conversions and growth from existing SWP clients during 2023. • Revenue from Assets under management, administration, and distribution fees was favorably impacted by higher assets under administration due to new products and additional services provided to existing alternative investment clients of the Investment Managers segment.
(D) In addition to the assets presented, SEI also administers an additional $11.8 billion of average assets in Funds of Funds assets for the year ended December 31, 2023 on which SEI does not earn an administration fee.
(D) In addition to the assets presented, SEI also administers an additional $8.8 billion of average assets in Funds of Funds assets for the year ended December 31, 2024 on which SEI does not earn an administration fee.
As described under the caption “Regulatory Considerations” in Item 1 of this report, the range of possible sanctions that are available to regulatory authorities include limitations on our ability to engage in business for specified periods of time, the revocation of registration, censures and fines.
As described under the caption “Regulatory Considerations” in Item 1 of this report, the range of possible sanctions that are available to regulatory authorities include limitations on our ability to engage in business for specified periods of time or with certain restrictions, the revocation of registration, censures and fines.
Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs include $1.9 billion of assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee (as of December 31, 2023).
Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs include $1.4 billion of assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee (as of December 31, 2024).
The Organization for Economic Co-operation and Development (OECD) has a framework to implement a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds (referred to as Pillar 2), with certain aspects of Pillar 2 effective January 1, 2024 and other aspects effective January 1, 2025.
The Organization for Economic Co-operation and Development (OECD) has a framework to implement a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds (referred to as Pillar Two). Certain aspects of Pillar Two became effective January 1, 2024 and other aspects are effective January 1, 2025.
Revenues during 2023 were primarily affected by: • Decreased investment management fees from defined benefit client losses; partially offset by • Revenues from new Outsourced Chief Investment Officer (OCIO) platform clients; and • The positive impact from market appreciation on our asset-based fees. Revenues decreased $20.5 million, or 6%, in 2022 compared to the prior year.
Revenues decreased $33.6 million, or 10%, in 2023 compared to the prior year. Revenues during 2023 were primarily affected by: • Decreased investment management fees from defined benefit client losses; partially offset by • Revenues from new Outsourced Chief Investment Officer (OCIO) platform clients; and • The positive impact from market appreciation on our asset-based fees.
We paid a cash consideration of $43.9 million, net for the acquisition and recorded a contingent consideration of $3.9 million that may be earned by the seller over the two years after the closing, subject to the achievement of certain post-closing performance measurements (See Note 15 to the Notes to Consolidated Financial Statements). 32 • On December 20, 2023, we acquired Altigo, a cloud-based technology platform that provides inventory, e-subscription, and reporting capabilities for alternative investments, for a cash consideration of $12.5 million (See Note 15 to the Notes to Consolidated Financial Statements). • Cash flow from operations was $447.0 million during 2023. • SEI repurchased 5.2 million shares of its common stock at an average price of $59.34 per share for a total cost of $310.8 million and paid $114.8 million in cash dividends to shareholders during 2023.
We paid a cash consideration of $43.9 million, net for the acquisition and recorded a contingent consideration of $3.9 million that may be earned by the seller over the two years after the closing, subject to the achievement of certain post-closing performance measurements (See Note 16 to the Notes to Consolidated Financial Statements). • On December 20, 2023, we acquired Altigo, a cloud-based technology platform that provides inventory, e-subscription, and reporting capabilities for alternative investments, for a cash consideration of $12.5 million (See Note 16 to the Notes to Consolidated Financial Statements). 28 • SEI repurchased 5.2 million shares of its common stock at an average price of $59.34 per share for a total cost of $310.8 million and paid $114.8 million in cash dividends to shareholders during 2023.
During 2023, 2022 and 2021, we revised the estimates of when certain vesting targets for stock options were expected to be achieved. These changes in estimates resulted in a decrease in stock-based compensation expense of $6.9 million and $4.9 million in 2023 and 2022, respectively, and an increase in stock-based compensation expense of $5.9 million in 2021.
During 2024, 2023 and 2022, we revised the estimates of when certain vesting targets for stock options were expected to be achieved. These changes in estimates resulted in an increase in stock-based compensation expense of $11.2 million in 2024, and a decrease of $6.9 million and $4.9 million in 2023 and 2022, respectively.
Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs include assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee. The average value of these assets for the year ended December 31, 2023 was $2.0 billion.
Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs include assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee. The average value of these assets for the year ended December 31, 2024 was $1.7 billion.
The increased personnel costs were primarily related to salary and incentive compensation costs. • Capitalized software development costs were $34.0 million in 2023, of which $18.2 million was for continued enhancements to the SEI Wealth Platform SM (SWP).
The increased personnel costs were primarily related to salary and incentive compensation costs. • Capitalized software development costs were $34.0 million in 2023, of which $18.2 million was for continued enhancements to SWP.
Revenues during 2023 were primarily affected by: • Decreased investment management fees from SEI fund programs resulting from negative cash flows and a decrease in average basis points earned on assets; partially offset by • Increased fees from separately managed account programs from positive cash flows; and • The positive impact from market appreciation on our asset-based fees.
Revenues during 2023 were primarily affected by: • Decreased investment management fees from SEI fund programs resulting from negative cash flows and a decrease in average basis points earned on assets; partially offset by • Increased fees from separately managed account programs from positive cash flows; and • The positive impact from market appreciation on our asset-based fees. 37 Operating margins were 44% in 2024 and 41% in 2023.
If this estimate proves to be inaccurate, the remaining amount of stock-based compensation expense for stock options could be accelerated, spread out over a longer period, or reversed. We currently base expectations for these assumptions from historical data and other applicable factors.
If this estimate proves to be inaccurate, the remaining amount of stock-based compensation expense for stock options could be accelerated, spread out over a longer period, or reversed. We currently base expectations for these assumptions from historical data and other applicable factors. These expectations are subject to change in future periods.
As of January 31, 2024, the amount of cash and cash equivalents considered free and immediately accessible for other general corporate purposes was $355.2 million. Cash and cash equivalents include accounts managed by our subsidiaries that are used in their operations or to cover specific business and regulatory requirements.
As of January 31, 2025, the amount of cash and cash equivalents considered free and immediately accessible for other general corporate purposes was $276.3 million. Cash and cash equivalents include accounts managed by our subsidiaries that are used in their operations or to cover specific business and regulatory requirements.
Operating income in 2023 was primarily affected by: • A decrease in revenues; • Increased personnel costs; • Increased net direct expenses primarily associated with the increase in separately managed account fees; and • Increased non-capitalized consulting costs; partially offset by; • Decreased amortization expense related to SWP. Operating margins were 44% in 2022 and 50% in 2021.
Operating income in 2023 was primarily affected by: • A decrease in revenues; • Increased personnel costs; • Increased net direct expenses primarily associated with the increase in separately managed account fees; and • Increased non-capitalized consulting costs; partially offset by; • Decreased amortization expense related to SWP.
(C) Equity and fixed-income programs include $6.2 billion of average assets invested in various asset allocation funds for the year ended December 31, 2023.
(C) Equity and fixed-income programs include $6.3 billion of average assets invested in various asset allocation funds for the year ended December 31, 2024.
The dividend was paid on January 9, 2024 for a total of $61.1 million. Cash Requirements Cash requirements and liquidity needs are primarily funded through cash flow from operations and our capacity for additional borrowing. At December 31, 2023, unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.
The dividend was paid on January 8, 2025 for a total of $63.9 million. 43 Cash Requirements Cash requirements and liquidity needs are primarily funded through cash flow from operations and our capacity for additional borrowing. At December 31, 2024, unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.
Revenues during 2023 were primarily affected by: • Increased revenues from new products launched and additional services provided to our largest alternative fund clients; and • Positive cash flows into alternative and traditional funds from new and existing clients; partially offset by • Client losses and fund closures.
Revenues during 2023 were primarily affected by: • Increased revenues from new products launched and additional services provided to our largest alternative fund clients; and • Positive cash flows into alternative and traditional funds from new and existing clients; partially offset by • Client losses and fund closures. Operating margins were 38% in 2024 and 35% in 2023.
Operating margins were 9% in 2023 and 18% in 2022. Operating income decreased $54.9 million, or 54%, in 2023 compared to the prior year.
Operating margins were 10% in 2023 and 18% in 2022. Operating income decreased $54.4 million, or 53%, in 2023 compared to the prior year.
While it is uncertain whether the United States will enact legislation to adopt Pillar 2, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement Pillar 2.
While it is uncertain whether the U.S. will enact legislation to adopt Pillar Two, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement Pillar Two.
We continue to evaluate improvements to our information technology infrastructure which, if implemented, will result in additional expenditures for purchased software and equipment for data center operations. • Cash paid for acquisitions, net of cash acquired.
Capital expenditures in 2024, 2023 and 2022 primarily include capital outlays for purchased software and equipment for data center operations. We continue to evaluate improvements to our information technology infrastructure which, if implemented, will result in additional expenditures for purchased software and equipment for data center operations. • Cash paid for acquisitions, net of cash acquired.
There was approximately $39.9 million of unrecognized compensation cost related to RSUs at December 31, 2023 and we expect to recognize approximately $16.4 million in stock-based compensation costs for RSUs in 2024. Fair Value Measurements The fair value of financial assets and liabilities, except for the investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy.
There was approximately $52.7 million of unrecognized compensation cost related to RSUs at December 31, 2024 and we expect to recognize approximately $25.6 million in stock-based compensation costs for RSUs in 2025. Fair Value Measurements The fair value of financial assets and liabilities, except for the investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy.
These one-time costs are primarily included in Compensation, benefits and other personnel costs on the accompanying Consolidated Statement of Operations and are reported in corporate overhead expenses (See Note 14 to the Consolidated Financial Statements).
These one-time costs are primarily included in Compensation, benefits and other personnel costs on the accompanying Consolidated Statement of Operations and are reported in corporate overhead expenses.
These expectations are subject to change in future periods. 48 Valuation of Assets Acquired in an Acquisition Including Goodwill and Intangible Assets: We allocate the fair value of the total purchase price paid for acquisitions to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values.
Valuation of Assets Acquired in an Acquisition Including Goodwill and Intangible Assets: We allocate the fair value of the total purchase price paid for acquisitions to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values.
There was approximately $89.1 million of unrecognized compensation cost related to unvested employee stock options at December 31, 2023 and we expect to recognize approximately $36.6 million in stock-based compensation costs for stock options in 2024.
There was approximately $67.9 million of unrecognized compensation cost related to unvested employee stock options at December 31, 2024 and we expect to recognize approximately $31.1 million in stock-based compensation costs for stock options in 2025.
Our purchases, sales and maturities of marketable securities during 2023, 2022 and 2021 were as follows: 2023 2022 2021 Purchases $ (143,389) $ (178,217) $ (216,260) Sales and maturities 121,988 161,160 195,096 Net investing activities from marketable securities $ (21,401) $ (17,057) $ (21,164) See Note 5 to the Consolidated Financial Statements for more information related to marketable securities. • The capitalization of costs incurred in developing computer software.
Our purchases, sales and maturities of marketable securities during 2024, 2023 and 2022 were as follows: 2024 2023 2022 Purchases $ (177,025) $ (143,389) $ (178,217) Sales and maturities 152,917 121,988 161,160 Net investing activities from marketable securities $ (24,108) $ (21,401) $ (17,057) See Note 5 to the Consolidated Financial Statements for more information related to marketable securities. • The capitalization of costs incurred in developing computer software.
The following table lists information regarding repurchases of common stock during 2023, 2022 and 2021: Year Total Number of Shares Repurchased Average Price Paid per Share Total Cost 2023 5,237,000 $ 59.34 $ 310,769 2022 5,914,000 57.22 338,442 2021 6,747,000 61.00 411,534 • Proceeds from the issuance of our common stock.
The following table lists information regarding repurchases of common stock during 2024, 2023 and 2022: Year Total Number of Shares Repurchased Average Price Paid per Share Total Cost 2024 6,840,000 $ 74.92 $ 512,477 2023 5,237,000 59.34 310,769 2022 5,914,000 57.22 338,442 • Proceeds from the issuance of our common stock.
Other income and expense items Other income and expense items on the accompanying Consolidated Statements of Operations consist of: Year Ended December 31, 2023 2022 2021 Equity in earnings of unconsolidated affiliates $ 126,930 $ 120,667 $ 137,572 Interest and dividend income 41,027 13,308 3,649 Net gain (loss) from investments 2,757 (3,078) (366) Interest expense (583) (749) (563) Other income — 3,379 — Total other income and expense items, net $ 170,131 $ 133,527 $ 140,292 Equity in earnings of unconsolidated affiliates Equity in earnings of unconsolidated affiliate reflects our 38.6% ownership interest in LSV.
Other income and expense items Other income and expense items on the accompanying Consolidated Statements of Operations consist of: Year Ended December 31, 2024 2023 2022 Equity in earnings of unconsolidated affiliates $ 135,741 $ 126,930 $ 120,667 Interest and dividend income 48,897 41,027 13,308 Net gain (loss) from investments 2,790 2,757 (3,078) Interest expense (563) (583) (749) Other income 8,151 — 3,379 Total other income and expense items, net $ 195,016 $ 170,131 $ 133,527 Equity in earnings of unconsolidated affiliates Equity in earnings of unconsolidated affiliate reflects our 38.6% ownership interest in LSV.
The decline in amortization expense was due to the amortization period of the initial development costs related to SWP which ended in second-quarter 2022 (See the caption "Capitalized software development costs" later in this discussion for more information). • Interest and dividend income was $41.0 million in 2023 as compared to $13.3 million in 2022.
The decline in amortization expense was due to the amortization period of the initial development costs related to SWP which ended in second-quarter 2022. • Interest and dividend income was $41.0 million in 2023 as compared to $13.3 million in 2022.
The generally favorable capital market conditions during 2023 had a positive impact on our asset-based fees thereby contributing to growth in our base revenues.
The continuation of favorable capital market returns during 2024 had a positive impact on our asset-based fees thereby contributing to growth in our base revenues.
A decline in interest rates will significantly reduce the earnings derived from this program. The assets related to the SEI Integrated Cash program are included in Platform-only assets-deposit program of the Investment Advisors segment on the accompanying Ending Assets Balances and Average Assets Balances schedules.
A decline in market interest rates or an increase in alternative cash management options selected by clients could significantly reduce the earnings derived from this program. The assets related to the SEI Integrated Cash program are included in Platform-only assets-deposit program of the Investment Advisors segment on the accompanying Ending Assets Balances and Average Assets Balances schedules.
Cash flows from operations decreased $119.1 million in 2023 compared to 2022 primarily due to the decrease in net income, the increase in receivables from clients of the Investment Managers segment, and a decrease in accrued liabilities primarily from payments related to the VSP.
Cash flows from operations decreased $119.1 million in 2023 compared to 2022 primarily from the decrease in net income, an increase in receivables from clients of the Investment Managers segment, and a decrease in accrued liabilities primarily from payments related to the VSP. Net cash used in investing activities includes: • Purchases, sales and maturities of marketable securities.
Operating margins were 35% in 2023 and 2022. Operating income increased $13.2 million, or 6%, in 2023 compared to the prior year.
Operating margins were 35% in 2023 and 36% in 2022. Operating income increased $8.4 million, or 4%, in 2023 compared to the prior year.
We received $101.2 million, $58.2 million and $55.2 million in proceeds from the issuance of common stock during 2023, 2022 and 2021, respectively. The proceeds we receive from the issuance of common stock is directly attributable to the levels of stock option exercise activity. • Payment of contingent consideration.
We received $126.0 million, $101.2 million and $58.2 million in proceeds from the issuance of common stock during 2024, 2023 and 2022, respectively. The proceeds we receive from the issuance of common stock is directly attributable to the levels of stock option exercise activity. • Dividend payments.
Cash dividends paid during 2023, 2022 and 2021 were as follows: Year Cash Dividends Paid Cash Dividends Paid per Share 2023 $ 114,837 $ 0.86 2022 109,830 0.80 2021 105,516 0.74 The Board of Directors declared a semi-annual cash dividend of $0.46 per share on December 15, 2023.
Cash dividends paid during 2024, 2023 and 2022 were as follows: Year Cash Dividends Paid Cash Dividends Paid per Share 2024 $ 120,346 $ 0.92 2023 114,837 0.86 2022 109,830 0.80 The Board of Directors declared a semi-annual cash dividend of $0.49 per share on December 12, 2024.
Net negative cash flows from existing clients and client losses partially offset the increase in earnings from LSV. Average assets under management by LSV decreased $1.5 billion to $85.7 billion during 2023 as compared to $87.2 billion during 2022, a decrease of 2%.
Negative cash flows from existing clients and client losses partially offset the increase in earnings from LSV. Average assets under management by LSV increased $5.2 billion to $90.9 billion during 2024 as compared to $85.7 billion during 2023, an increase of 6%.
We do not expect Pillar 2 to have a material impact on our effective tax rate or our consolidated results of operations, financial position and cash flows. Stock-Based Compensation During 2023, 2022 and 2021, we recognized approximately $31.3 million, $39.4 million and $41.5 million, respectively, in stock-based compensation expense.
We have determined Pillar Two has not had a material impact on our effective tax rate, consolidated results of operation, financial position, or cash flows. Stock-Based Compensation During 2024, 2023 and 2022, we recognized approximately $58.6 million, $31.3 million and $39.4 million, respectively, in stock-based compensation expense.
As of December 31, 2023, through our subsidiaries and partnerships in which we have a significant interest, we manage, advise or administer approximately $1.4 trillion in hedge, private equity, mutual fund and pooled or separately managed assets.
Investment operations and investment management fees are earned as a percentage of assets under management, administration or advised assets. As of December 31, 2024, through our subsidiaries and partnerships in which we have a significant interest, we manage, advise or administer approximately $1.6 trillion in hedge, private equity, mutual fund and pooled or separately managed assets.
The table below presents the revenues and net income of LSV and our proportionate share in LSV's earnings. 2023 2022 Percent Change 2021 Percent Change Revenues $ 426,270 $ 406,895 5 % $ 456,259 (11) % Net income 328,905 312,180 5 % 354,964 (12) % SEI's proportionate share in the earnings of LSV $ 126,930 $ 120,667 5 % $ 137,572 (12) % The increase in earnings from LSV in 2023 was primarily due to higher performance fees and market appreciation.
The table below presents the revenues and net income of LSV and our proportionate share in LSV's earnings. 2024 2023 Percent Change 2022 Percent Change Revenues $ 457,589 $ 426,270 7 % $ 406,895 5 % Net income 351,815 328,905 7 % 312,180 5 % SEI's proportionate share in the earnings of LSV $ 135,741 $ 126,930 7 % $ 120,667 5 % 39 The increase in earnings from LSV in 2024 and 2023 was primarily due to higher assets under management from market appreciation and higher performance fees.
Condensed Consolidated Statements of Operations for the years ended 2023, 2022 and 2021 were: Year Ended December 31, 2023 2022 Percent Change* 2021 Percent Change Revenues $ 1,919,793 $ 1,991,037 (4) % $ 1,918,309 4 % Expenses 1,495,269 1,515,284 (1) % 1,364,928 11 % Income from operations 424,524 475,753 (11) % 553,381 (14) % Net gain (loss) from investments 2,757 (3,078) NM (366) NM Interest income, net of interest expense 40,444 12,559 222 % 3,086 307 % Other income — 3,379 NM — NM Equity in earnings of unconsolidated affiliates 126,930 120,667 5 % 137,572 (12) % Income before income taxes 594,655 609,280 (2) % 693,673 (12) % Income taxes 132,397 133,813 (1) % 147,080 (9) % Net income 462,258 475,467 (3) % 546,593 (13) % Diluted earnings per common share $ 3.46 $ 3.46 — % $ 3.81 (9) % * Variances noted "NM" indicate the percent change is not meaningful. 31 Significant Items Impacting Our Financial Results in 2023 Revenues decreased $71.2 million, or 4%, to $1.9 billion in 2023 compared to 2022.
Condensed Consolidated Statements of Operations for the years ended 2024, 2023 and 2022 were: Year Ended December 31, 2024 2023 Percent Change* 2022 Percent Change Revenues $ 2,125,151 $ 1,919,793 11 % $ 1,991,037 (4) % Expenses 1,573,410 1,495,269 5 % 1,515,284 (1) % Income from operations 551,741 424,524 30 % 475,753 (11) % Net gain (loss) from investments 2,790 2,757 1 % (3,078) NM Interest income, net of interest expense 48,334 40,444 20 % 12,559 222 % Other income 8,151 — NM 3,379 NM Equity in earnings of unconsolidated affiliates 135,741 126,930 7 % 120,667 5 % Income before income taxes 746,757 594,655 26 % 609,280 (2) % Income taxes 165,566 132,397 25 % 133,813 (1) % Net income 581,191 462,258 26 % 475,467 (3) % Diluted earnings per common share $ 4.41 $ 3.46 27 % $ 3.46 — % * Variances noted "NM" indicate the percent change is not meaningful. 26 Significant Items Impacting Our Financial Results in 2024 Revenues increased $205.4 million, or 11%, to $2.1 billion in 2024 compared to 2023.
Below are the most significant recurring and discrete items (See Note 11 to the Consolidated Financial Statements for more information): Year Ended December 31, 2023 2022 2021 Statutory rate 21.0 % 21.0 % 21.0 % State taxes, net of federal tax benefit 2.6 2.9 2.6 Foreign tax expense and tax rate differential (0.3) (0.2) (0.1) Tax benefit from stock option exercises (0.3) (0.7) (1.2) Research and development tax credit (1.1) (1.1) (1.0) Foreign-Derived Intangible Income Deduction (FDII) (0.3) (0.3) (0.2) Other, net 0.7 0.4 0.1 22.3 % 22.0 % 21.2 % The increases in the effective rate in 2023 and 2022 was primarily due to reduced tax benefits related to stock option exercises as compared to the prior year.
The effective tax rate is also affected by discrete items that may occur in any given year, but are not consistent from year to year. 40 Below are the most significant recurring and discrete items (See Note 11 to the Consolidated Financial Statements for more information): Year Ended December 31, 2024 2023 2022 Statutory rate 21.0 % 21.0 % 21.0 % State taxes, net of federal tax benefit 2.1 2.6 2.9 Foreign tax expense and tax rate differential 0.2 (0.3) (0.2) Tax benefit from stock option exercises (0.7) (0.3) (0.7) Research and development tax credit (0.9) (1.1) (1.1) Foreign-Derived Intangible Income Deduction (FDII) (0.2) (0.3) (0.3) Other, net 0.7 0.7 0.4 22.2 % 22.3 % 22.0 % The decrease in the effective rate in 2024 was primarily due to the recognition of tax credits and a reduction of the valuation reserve for net operating losses impacting our state tax rate.
Under the terms of the program, SPTC will earn interest income based on the portion of its client’s cash balances held in the FDIC-insured accounts. We expect this program could generate significant revenue for the Investment Advisors segment in 2024 assuming interest rates remain at current levels.
Under the terms of the program, SPTC will earn interest income based on the portion of its client’s cash balances held in the FDIC-insured accounts. This program generated revenue of $51.5 million for the Investment Advisors segment in 2024.
The capitalization of the initial development work related to SWP began in mid-2007 when the platform was determined to be ready for its intended use.
The decline in amortization expense in 2023 was due to the amortization period associated with the initial development work related to SWP which began in mid-2007 when the platform was determined to be ready for its intended use.
Revenues decreased $35.2 million, or 7%, in 2022 compared to the prior year.
Revenues decreased $73.7 million, or 13%, in 2023 compared to the prior year.
Investment Advisors Year Ended December 31, 2023 2022 Percent Change 2021 Percent Change Revenues: Investment management fees-SEI fund programs $ 239,244 $ 263,266 (9) % $ 301,581 (13) % Separately managed account fees 174,418 162,762 7 % 158,181 3 % Other fees 22,636 21,738 4 % 23,187 (6) % Total revenues $ 436,298 $ 447,766 (3) % $ 482,949 (7) % Revenues decreased $11.5 million, or 3%, in 2023 compared to the prior year.
Investment Advisors Year Ended December 31, 2024 2023 Percent Change 2022 Percent Change Revenues: Investment management fees-SEI fund programs $ 233,992 $ 239,244 (2) % $ 263,266 (9) % Separately managed account fees 197,638 174,418 13 % 162,762 7 % Other fees 77,778 22,636 244 % 21,738 4 % Total revenues $ 509,408 $ 436,298 17 % $ 447,766 (3) % Revenues increased $73.1 million, or 17%, in 2024 compared to the prior year.
Ending Asset Balances (In millions) As of December 31, Percent Change Percent Change 2023 2022 2021 Private Banks: Equity and fixed-income programs $ 24,496 $ 22,377 9 % $ 26,281 (15) % Collective trust fund programs 4 7 (43) % 6 17 % Liquidity funds 3,916 3,201 22 % 4,724 (32) % Total assets under management $ 28,416 $ 25,585 11 % $ 31,011 (17) % Client assets under administration 7,267 4,151 75 % 4,481 (7) % Total assets $ 35,683 $ 29,736 20 % $ 35,492 (16) % Investment Advisors: Equity and fixed-income programs $ 71,634 $ 66,240 8 % $ 81,686 (19) % Liquidity funds 4,812 5,436 (11) % 4,317 26 % Total Platform assets under management $ 76,446 $ 71,676 7 % $ 86,003 (17) % Platform-only assets 18,324 13,931 32 % 14,564 (4) % Platform-only assets-deposit program 843 — NM — NM Total Platform assets $ 95,613 $ 85,607 12 % $ 100,567 (15) % Institutional Investors: Equity and fixed-income programs $ 77,208 $ 73,178 6 % $ 91,719 (20) % Collective trust fund programs 1 5 (80) % 5 — % Liquidity funds 1,734 1,557 11 % 2,118 (26) % Total assets under management $ 78,943 $ 74,740 6 % $ 93,842 (20) % Advised assets 6,120 4,314 42 % 4,857 (11) % Total assets $ 85,063 $ 79,054 8 % $ 98,699 (20) % Investment Managers: Collective trust fund programs (A) $ 156,376 $ 141,285 11 % $ 92,549 53 % Liquidity funds 114 199 (43) % 423 (53) % Total assets under management $ 156,490 $ 141,484 11 % $ 92,972 52 % Client assets under administration 935,564 810,491 15 % 907,377 (11) % Total assets $ 1,092,054 $ 951,975 15 % $ 1,000,349 (5) % Investments in New Businesses: Equity and fixed-income programs $ 2,174 $ 1,912 14 % $ 2,096 (9) % Liquidity funds 209 215 (3) % 240 (10) % Total assets under management $ 2,383 $ 2,127 12 % $ 2,336 (9) % Advised assets 1,150 1,077 7 % 1,410 (24) % Total assets $ 3,533 $ 3,204 10 % $ 3,746 (14) % LSV: Equity and fixed-income programs (B) $ 89,312 $ 83,753 7 % $ 98,984 (15) % 35 Total: Equity and fixed-income programs (C) $ 264,824 $ 247,460 7 % $ 300,766 (18) % Collective trust fund programs 156,381 141,297 11 % 92,560 53 % Liquidity funds 10,785 10,608 2 % 11,822 (10) % Total assets under management $ 431,990 $ 399,365 8 % $ 405,148 (1) % Advised assets 7,270 5,391 35 % 6,267 (14) % Client assets under administration (D) 942,831 814,642 16 % 911,858 (11) % Platform-only assets 19,167 $ 13,931 38 % 14,564 (4) % Total assets $ 1,401,258 $ 1,233,329 14 % $ 1,337,837 (8) % (A) Collective trust fund program assets are included in assets under management since SEI is the trustee.
Ending Asset Balances (In millions) As of December 31, Percent Change Percent Change 2024 2023 2022 Investment Managers: Collective trust fund programs (A) $ 202,384 $ 156,376 29 % $ 141,285 11 % Liquidity funds 188 114 65 % 199 (43) % Total assets under management $ 202,572 $ 156,490 29 % $ 141,484 11 % Client assets under administration (E) 1,032,812 920,757 12 % 794,149 16 % Total assets $ 1,235,384 $ 1,077,247 15 % $ 935,633 15 % Private Banks: Equity and fixed-income programs $ 25,523 $ 24,496 4 % $ 22,377 9 % Collective trust fund programs 4 4 — % 7 (43) % Liquidity funds 2,688 3,916 (31) % 3,201 22 % Total assets under management $ 28,215 $ 28,416 (1) % $ 25,585 11 % Client assets under administration 8,340 7,267 15 % 4,151 75 % Total assets $ 36,555 $ 35,683 2 % $ 29,736 20 % Investment Advisors: Equity and fixed-income programs $ 76,283 $ 71,634 6 % $ 66,240 8 % Liquidity funds 3,105 4,812 (35) % 5,436 (11) % Total Platform assets under management $ 79,388 $ 76,446 4 % $ 71,676 7 % Platform-only assets 25,244 18,324 38 % 13,931 32 % Platform-only assets-deposit program 2,398 843 184 % — NM Total Platform assets $ 107,030 $ 95,613 12 % $ 85,607 12 % Institutional Investors: Equity and fixed-income programs $ 75,481 $ 77,208 (2) % $ 73,178 6 % Collective trust fund programs 1 1 — % 5 (80) % Liquidity funds 1,511 1,734 (13) % 1,557 11 % Total assets under management $ 76,993 $ 78,943 (2) % $ 74,740 6 % Client assets under advisement 5,955 6,120 (3) % 4,314 42 % Total assets $ 82,948 $ 85,063 (2) % $ 79,054 8 % Investments in New Businesses: Equity and fixed-income programs $ 2,747 $ 2,174 26 % $ 1,912 14 % Liquidity funds 297 209 42 % 215 (3) % Total assets under management $ 3,044 $ 2,383 28 % $ 2,127 12 % Client assets under advisement 2,185 1,150 90 % 1,077 7 % Client assets under administration (E) 14,791 14,807 — % 16,342 (9) % Total assets $ 20,020 $ 18,340 9 % $ 19,546 (6) % LSV: Equity and fixed-income programs (B) $ 86,501 $ 89,312 (3) % $ 83,753 7 % 31 Total: Equity and fixed-income programs (C) $ 266,535 $ 264,824 1 % $ 247,460 7 % Collective trust fund programs 202,389 156,381 29 % 141,297 11 % Liquidity funds 7,789 10,785 (28) % 10,608 2 % Total assets under management $ 476,713 $ 431,990 10 % $ 399,365 8 % Advised assets 8,140 7,270 12 % 5,391 35 % Client assets under administration (D) 1,055,943 942,831 12 % 814,642 16 % Platform-only assets 27,642 $ 19,167 44 % 13,931 38 % Total assets $ 1,568,438 $ 1,401,258 12 % $ 1,233,329 14 % (A) Collective trust fund program assets are included in assets under management since SEI is the trustee.
Income Taxes Our effective tax rate was 22.3% for 2023, 22.0% for 2022 and 21.2% for 2021. The effective tax rate is affected by recurring items, such as the U.S. federal tax rates and tax rates in various states and foreign jurisdictions and the relative amount of income earned in those jurisdictions.
The effective tax rate is affected by recurring items, such as the U.S. federal tax rates and tax rates in various states and foreign jurisdictions and the relative amount of income earned in those jurisdictions. The income earned by jurisdiction has been fairly consistent.
We capitalized $34.0 million, $35.3 million and $26.0 million of software development costs in 2023, 2022 and 2021, respectively. The majority of our 46 software development costs are related to significant enhancements for the expanded functionality of the SEI Wealth Platform.
We capitalized $24.3 million, $34.0 million and $35.3 million of software development costs in 2024, 2023 and 2022, respectively. Our software development costs are related to significant enhancements for the expanded functionality of the SEI Wealth Platform and the development of a new platform for the Investment Managers segment (See Note 1 to the Consolidated Financial Statements). • Capital expenditures.
Investment processing fees are earned as either monthly fees for contracted services or as a percentage of the market value of our clients' assets processed on our platforms. Investment operations and investment management fees are earned as a percentage of assets under management, administration or advised assets.
Overview Consolidated Summary SEI Investments Company is a leading global provider of financial technology, operations, and asset management services within the financial services industry. Investment processing fees are earned as either monthly fees for contracted services or as a percentage of the market value of our clients' assets processed on our platforms.
The Board of Directors has authorized the repurchase of common stock through multiple authorizations. Currently, there is no expiration date for the common stock repurchase program.
Currently, there is no expiration date for the common stock repurchase program.
The amortization expense related to the initial software development costs ended in the second quarter of 2022, resulting in declines in amortization expense related to capitalized software development costs in 2023 and 2022 compared to the prior year (See Note 1 to the Consolidated Financial Statements).
The amortization expense related to these initial software development costs ended in the second quarter of 2022 (See Note 1 to the Consolidated Financial Statements). We expect to recognize amortization expense of $28.6 million related to all capitalized software development costs in 2025.
Approximately 43% of our investment processing and software servicing fees are earned as a percentage of the market value of clients’ asset processed, primarily from SWP and our solution clients. Investment Management Platforms Our investment management platforms include investment management programs and back-office investment processing outsourcing services and are generally offered on a bundled basis.
During the fourth quarter of 2024, approximately 47% of our investment processing and software servicing fees are earned as a percentage of the market value of clients’ asset processed, primarily from SWP and our solution clients.
Revenues during 2022 were primarily affected by: • Increased revenues from new products launched and additional services provided to our largest alternative fund clients; and • Positive cash flows into alternative and separately managed account offerings from new and existing clients; partially offset by • Client losses, fund closures and the impact of market depreciation during 2022 to revenue from traditional fund clients.
Revenues during 2024 were primarily affected by: • Increased revenues from additional services provided to our largest alternative fund clients; and • Positive cash flows into alternative and traditional funds from new and existing clients; partially offset by • Client losses and fund closures. Revenues increased $45.6 million, or 8%, in 2023 compared to the prior year.
The direct and indirect costs of responding to these regulatory activities and of complying with new or modified regulations, as well as the potential financial costs and potential reputational impact against us of any enforcement proceedings that might result, is uncertain but could have a material adverse impact on our operating results or financial position. 45 Liquidity and Capital Resources Year Ended December 31, 2023 2022 2021 Net cash provided by operating activities $ 447,030 $ 566,119 $ 633,101 Net cash used in investing activities (141,543) (89,809) (164,883) Net cash used in financing activities (331,324) (437,235) (422,319) Effect of exchange rate changes on cash and cash equivalents 7,476 (17,474) (1,868) Net (decrease) increase in cash and cash equivalents (18,361) 21,601 44,031 Cash, cash equivalents and restricted cash, beginning of year 853,359 831,758 787,727 Cash, cash equivalents and restricted cash, end of year $ 834,998 $ 853,359 $ 831,758 The credit facility provides for borrowings up to $325.0 million and is scheduled to expire in April 2026.
Liquidity and Capital Resources Year Ended December 31, 2024 2023 2022 Net cash provided by operating activities $ 622,343 $ 447,030 $ 566,119 Net cash used in investing activities (117,302) (141,543) (89,809) Net cash used in financing activities (494,401) (331,324) (437,235) Effect of exchange rate changes on cash and cash equivalents (5,445) 7,476 (17,474) Net increase (decrease) in cash and cash equivalents 5,195 (18,361) 21,601 Cash, cash equivalents and restricted cash, beginning of year 834,998 853,359 831,758 Cash, cash equivalents and restricted cash, end of year $ 840,193 $ 834,998 $ 853,359 Our credit facility provides for borrowings up to $325.0 million and is scheduled to expire in April 2026.
Operating income decreased $46.5 million, or 19%, in 2022 compared to the prior year.
Revenues decreased $11.5 million, or 3%, in 2023 compared to the prior year.
Operating income during 2023 was primarily affected by: • A decrease in revenues; • A one-time operational charge of $4.5 million related to a client reimbursement; partially offset by • Decreased direct expenses associated with investment management fees; and • Decreased professional fees. Operating margins were 47% in 2022 and 51% in 2021.
Operating income during 2024 was primarily affected by: • Decreased direct expenses associated with investment management fees; • Decreased costs, primarily personnel, related to cost containment measures; and • A one-time operational charge of $4.5 million related to a client reimbursement during the second quarter 2023; partially offset by • A decrease in revenues as mentioned above; • Increased costs and amortization related to the acquisition of XPS Pensions (Nexus) Limited; and • Increased stock-based compensation costs related to the attainment of strong financial results during 2024.
Corporate overhead expenses were $132.2 million, $168.2 million and $91.9 million in 2023, 2022 and 2021, respectively. The decrease in corporate overhead expenses during 2023 is primarily due to personnel costs associated with the VSP of $54.8 million recorded in the third quarter of 2022 (See Note 14 to the Consolidated Financial Statements).
The decrease in corporate overhead expenses during 2023 was primarily due to personnel costs associated with the VSP recorded in the third quarter of 2022 (See Note 14 to the Consolidated Financial Statements). Non-recurring consulting costs related to corporate strategic planning, target market review and other corporate analysis projects partially offset the decrease in corporate overhead expenses in 2023.
Revenues increased $82.1 million, or 17%, in 2022 compared to the prior year.
Institutional Investors Revenues decreased $4.0 million, or 1%, in 2024 compared to the prior year.
Operating margins were 35% in 2022 and 40% in 2021. Operating income decreased $12.4 million, or 5%, in 2022 compared to the prior year.
Operating margins were 46% in 2024 and 43% in 2023. Operating income increased $6.8 million, or 5%, in 2024 compared to the prior year.
All other terms and conditions of the original agreement remain in effect. The majority of excess cash reserves are primarily placed in accounts located in the United States that invest in SEI-sponsored money market mutual funds denominated in the U.S. dollar.
Currently, our ability to borrow from the credit facility is not limited by any covenant of the agreement (See Note 6 to the Consolidated Financial Statements). The majority of excess cash reserves are primarily placed in accounts located in the United States that invest in SEI-sponsored money market mutual funds denominated in the U.S. dollar.
The decrease in earnings from LSV in 2022 was due to negative cash flows from existing clients, market depreciation and client losses. Increased performance fees during 2022 partially offset the decrease in earnings from LSV. Interest and dividend income Interest and dividend income is earned based upon the amount of cash that is invested daily.
Interest and dividend income Interest and dividend income is earned based upon the amount of cash that is invested daily. The increase in interest and dividend income in 2024 was due to rising market interest rates during 2023 and higher invested cash balances. The increase in 2023 was due to increased market interest rates.
(C) Equity and fixed-income programs include $6.3 billion of assets invested in various asset allocation funds at December 31, 2023.
(C) Equity and fixed-income programs include $6.4 billion of assets invested in various asset allocation funds at December 31, 2024. (D) In addition to the assets presented, SEI also administers an additional $10.3 billion in Funds of Funds assets on which SEI does not earn an administration fee (as of December 31, 2024).
Revenues increased $43.8 million, or 8%, in 2022 compared to the prior year.
Operating income increased $49.2 million, or 22%, in 2024 compared to the prior year.
Operating income during 2022 was primarily affected by: • Increased personnel costs due to competitive labor markets; • Increased costs associated with new business, primarily personnel expenses and third-party vendor costs; and • Increased non-capitalized investment spending, mainly consulting costs; partially offset by • An increase in revenues; Other Corporate overhead expenses Corporate overhead expenses primarily consist of general and administrative expenses and other costs not directly attributable to a reportable business segment.
Operating income during 2024 was primarily affected by: • An increase in revenues as mentioned above; and • Decreased non-capitalized investment spending, mainly consulting costs; partially offset by • Increased costs associated with new business, primarily personnel expenses and third-party vendor costs; • Costs to enhance, support and maintain technologies and investment service capabilities; and • Increased incentive compensation and stock-based compensation costs related to the attainment of strong financial results during 2024.
Intangible assets The increase in amortization expense related to intangible assets and asset purchases in 2022 was due to the acquisitions of Finomial, SEI Novus and Atlas Master Trust during the fourth quarter 2021. Through these transactions, we acquired intangible assets related to technology, trade names and client relationships which are amortized over the estimated useful life of the assets.
Through these transactions, we acquired intangible assets related to technology, trade names and client relationships which are amortized over the estimated useful life of the assets. We expect to recognize amortization expense of $13.5 million related to all intangible assets in 2025. Income Taxes Our effective tax rate was 22.2% for 2024, 22.3% for 2023 and 22.0% for 2022.
The assets presented in the preceding tables do not include assets processed on SWP and are not included in the accompanying Consolidated Balance Sheets because we do not own them. 38 Business Segments Revenues, Expenses and Operating profit (loss) for our business segments for the year ended 2023 compared to the year ended 2022, and for the year ended 2022 compared to the year ended 2021 were: Year Ended December 31, 2023 2022 Percent Change 2021 Percent Change Private Banks: Revenues $ 503,317 $ 575,625 (13) % $ 493,570 17 % Expenses 455,820 473,209 (4) % 462,796 2 % Operating profit $ 47,497 $ 102,416 (54) % $ 30,774 233 % Operating margin 9 % 18 % 6 % Investment Advisors: Revenues 436,298 447,766 (3) % 482,949 (7) % Expenses 259,142 251,650 3 % 240,334 5 % Operating profit $ 177,156 $ 196,116 (10) % $ 242,615 (19) % Operating margin 41 % 44 % 50 % Institutional Investors: Revenues 289,708 323,353 (10) % 343,805 (6) % Expenses 165,455 172,252 (4) % 168,070 2 % Operating profit $ 124,253 $ 151,101 (18) % $ 175,735 (14) % Operating margin 43 % 47 % 51 % Investment Managers: Revenues 670,486 624,918 7 % 581,157 8 % Expenses 437,174 404,850 8 % 348,655 16 % Operating profit $ 233,312 $ 220,068 6 % $ 232,502 (5) % Operating margin 35 % 35 % 40 % Investments in New Businesses: Revenues 19,984 19,375 3 % 16,828 15 % Expenses 45,437 45,159 1 % 53,219 (15) % Operating loss $ (25,453) $ (25,784) NM $ (36,391) NM For additional information pertaining to our business segments, see Note 12 to the Consolidated Financial Statements. 39 Private Banks Year Ended December 31, 2023 2022 Percent Change 2021 Percent Change Revenues: Investment processing and software servicing fees $ 370,730 $ 453,531 (18) % $ 356,655 27 % Asset management, administration & distribution fees 132,587 122,094 9 % 136,915 (11) % Total revenues $ 503,317 $ 575,625 (13) % $ 493,570 17 % Revenues decreased $72.3 million, or 13%, in 2023 compared to the prior year.
The assets presented in the preceding tables do not include assets processed on SWP and are not included in the accompanying Consolidated Balance Sheets because we do not own them. 34 Business Segments Revenues, Expenses and Operating profit (loss) for our business segments for the year ended 2024 compared to the year ended 2023, and for the year ended 2023 compared to the year ended 2022 were: Year Ended December 31, 2024 2023 Percent Change 2022 Percent Change Investment Managers: Revenues $ 728,390 $ 645,254 13 % $ 599,661 8 % Expenses 453,085 419,196 8 % 381,965 10 % Operating profit $ 275,305 $ 226,058 22 % $ 217,696 4 % Operating margin 38 % 35 % 36 % Private Banks: Revenues 541,414 496,317 9 % 570,010 (13) % Expenses 460,375 448,490 3 % 467,821 (4) % Operating profit $ 81,039 $ 47,827 69 % $ 102,189 (53) % Operating margin 15 % 10 % 18 % Investment Advisors: Revenues 509,408 436,298 17 % 447,766 (3) % Expenses 282,902 259,142 9 % 251,650 3 % Operating profit $ 226,506 $ 177,156 28 % $ 196,116 (10) % Operating margin 44 % 41 % 44 % Institutional Investors: Revenues 285,723 289,708 (1) % 323,353 (10) % Expenses 154,701 165,455 (6) % 172,252 (4) % Operating profit $ 131,022 $ 124,253 5 % $ 151,101 (18) % Operating margin 46 % 43 % 47 % Investments in New Businesses: Revenues 60,216 52,216 15 % 50,247 4 % Expenses 74,699 70,745 6 % 73,432 (4) % Operating loss $ (14,483) $ (18,529) (22) % $ (23,185) (20) % For additional information pertaining to our business segments, see Note 12 to the Consolidated Financial Statements. 35 Investment Managers Revenues increased $83.1 million, or 13%, in 2024 compared to the prior year.
Macroeconomic factors such as stagnant or recessionary economies, persistent inflationary pressures, continuation of interest rate increases, declining property markets and consumer confidence, tight labor markets and geopolitical tensions, among others, could have significant influence on capital markets in 2024 and beyond.
Macroeconomic factors such as the reacceleration of inflationary pressures, higher long term interest rates, continued monetary stimulus measures from central banks, and geopolitical tensions, among others, could have significant influence on capital markets in 2025 and beyond.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInformation required by this item is set forth under the captions "Our revenues and earnings are affected by changes in capital markets and significant changes in the value of financial instruments" and "Changes in interest rates may affect the value of our fixed-income investment securities" in Item 1A, Risk Factors and under the caption "Sensitivity of our revenues and earnings to capital market fluctuations" in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations. 49
Biggest changeInformation required by this item is set forth under the captions "Our revenues and earnings are affected by changes in capital markets and significant changes in the value of financial instruments" and "Changes in interest rates may affect the value of our fixed-income investment securities" in Item 1A, Risk Factors and under the captions "Sensitivity of our 45 revenues and earnings to capital market fluctuations" and "SEI Integrated Cash Program" in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations. 46

Other SEIC 10-K year-over-year comparisons