We were all expecting more consolidation in the custodial services niche. Credit Suisse-advised State Street's deal to buy Investors Financial Services for $4.5 billion reflects that. The premium was on the high side at 38 percent. But State Street CEO Ron Logue told reporters that there were other bidders, and suggested that the premium will be worth it, though some analysts and shareholders are dismayed. The deal was necessitated in part by competitive pressure. The deal was inked just three months after Mellon Financial and Bank of New York dealed up, to form the industry's largest player. State Street will fall into second place, jumping JPMorgan Chase to third. There are not that many players left. It will be interesting to see what JPMorgan does. Stay tuned.

For more:
- here's an update from the AP