0000073124false00000731242024-01-182024-01-180000073124us-gaap:CommonStockMember2024-01-182024-01-180000073124ntrs:DepositarySharesMember2024-01-182024-01-18
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 18, 2024
NORTHERN TRUST CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware | | 001-36609 | | 36-2723087 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
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50 South LaSalle Street | | | | 60603 |
Chicago, | Illinois | | | | (Zip Code) |
(Address of principal executive offices) | | | | |
Registrant’s telephone number, including area code (312) 630-6000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | |
Title of each class | Trading Symbol | Name of each exchange on which registered |
Common Stock, $1.66 2/3 Par Value | NTRS | The NASDAQ Stock Market LLC |
Depositary Shares, each representing 1/1,000th interest in a share of Series E Non-Cumulative Perpetual Preferred Stock
| NTRSO | The NASDAQ Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition
The information contained in the registrant’s January 18, 2024 press release, reporting on the registrant’s earnings for the three and twelve months ended December 31, 2023, a copy of which is attached as Exhibit 99.1 hereto, is incorporated herein by reference.
Item 7.01. Regulation FD Disclosure
On January 18, 2024, the Corporation will hold a live conference call and webcast to discuss financial results for the three and twelve months ended December 31, 2023 and other matters relating to the Corporation. In connection therewith, the Corporation has also made available on its website presentation materials containing certain information relating to the Corporation (the “Presentation Materials”) and materials that contain additional information about the Corporation’s financial results for the three and twelve months ended December 31, 2023 (the “Financial Trends”), copies of which are attached as Exhibits 99.2 and 99.3 hereto, and are incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
The information provided in this Current Report on Form 8-K, including Exhibits 99.1, 99.2 and 99.3, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise stated in such filing.
(d) Exhibits:
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| Exhibit Number | Description |
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| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | | NORTHERN TRUST CORPORATION |
| | | (Registrant) |
| | | | | |
Dated: | January 18, 2024 | | By: | | /s/ Jason J. Tyler |
| | | | | Jason J. Tyler |
| | | | | Executive Vice President and Chief Financial Officer |
Exhibit 99.1
| | | | | | | | |
NEWS RELEASE | | |
www.northerntrust.com | | |
| | |
INVESTOR CONTACT: Jennifer Childe | 312-444-3290 | Jennifer.Childe@ntrs.com MEDIA CONTACT: Doug Holt | 312-662-8315 | Doug.Holt@ntrs.com
NORTHERN TRUST CORPORATION REPORTS FOURTH QUARTER
NET INCOME OF $113.1 MILLION, EARNINGS PER DILUTED COMMON SHARE OF $0.52
CHICAGO, JANUARY 18, 2024 — Northern Trust Corporation today reported fourth quarter net income per diluted common share of $0.52, compared to $1.49 in the third quarter of 2023 and $0.71 in the fourth quarter of 2022. Net income was $113.1 million, compared to $327.8 million in the prior quarter and $155.7 million in the prior-year quarter.
Fourth quarter 2023 results included the following:
•$176.4 million pre-tax loss on available for sale debt securities sold in conjunction with a repositioning of the portfolio, recognized in Investment Security Gains (Losses), net (after-tax $131.7 million).
•$84.6 million pre-tax Federal Deposit Insurance Corporation (FDIC) special assessment, recognized in Other Operating Expense (after-tax $63.1 million).
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MICHAEL O’GRADY, CHAIRMAN AND CHIEF EXECUTIVE OFFICER: |
“Northern Trust’s fourth quarter results capped off a solid year of progress made towards driving improved financial performance. In the fourth quarter, trust fee growth accelerated compared to the prior year, average deposit levels proved resilient, and credit quality remained strong. Importantly, we brought year-over-year expense growth, excluding notables, down in each quarter this year. We also improved our capital and liquidity levels while returning over $300 million in capital to shareholders.
As we begin 2024, we are squarely focused on accelerating profitable organic growth, maintaining our expense discipline and driving greater resiliency and efficiency in our operating model to create sustained long-term shareholder value over time.” |
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FINANCIAL SUMMARY & KEY METRICS | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions except per share data) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Trust, Investment and Other Servicing Fees | $ | 1,090.0 | | $ | 1,111.9 | | $ | 1,042.1 | | | (2) | % | 5 | % |
Other Noninterest Income (Loss) | (27.8) | | 158.4 | | (57.6) | | | N/M | (52) | |
Net Interest Income (FTE*) | 501.1 | | 469.4 | | 550.0 | | | 7 | | (9) | |
Total Revenue (FTE*) | $ | 1,563.3 | | $ | 1,739.7 | | $ | 1,534.5 | | | (10) | % | 2 | % |
| | | | | | |
Noninterest Expense | $ | 1,388.5 | | $ | 1,278.2 | | $ | 1,323.6 | | | 9 | % | 5 | % |
Provision for (Release of) Credit Losses | 11.0 | | 14.0 | | 5.0 | | | N/M | N/M |
Provision for Income Taxes | 32.7 | | 106.5 | | 34.7 | | | (69) | (6) | |
FTE Adjustment* | 18.0 | | 13.2 | | 15.5 | | | 36 | | 16 | |
Net Income | $ | 113.1 | | $ | 327.8 | | $ | 155.7 | | | (65) | % | (27) | % |
| | | | | | |
Earnings Allocated to Common and Potential Common Shares | $ | 106.5 | | $ | 308.5 | | $ | 148.7 | | | (65) | % | (28) | % |
Diluted Earnings per Common Share | $ | 0.52 | | $ | 1.49 | | $ | 0.71 | | | (65) | % | (27) | % |
Return on Average Common Equity | 4.0 | % | 11.6 | % | 5.9 | % | | | |
Return on Average Assets | 0.33 | % | 0.93 | % | 0.42 | % | | | |
Average Assets | $ | 136,588.7 | | $ | 140,201.6 | | $ | 147,803.6 | | | (3) | % | (8) | % |
N/M - Not meaningful
(*) Net interest income and total revenue presented on a fully taxable equivalent (FTE) basis are non-generally accepted accounting principle financial measures that facilitate the analysis of asset yields. Please refer to the Reconciliation to Fully Taxable Equivalent section for further detail.
| | |
NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
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CLIENT ASSETS | | | | | | |
Assets under custody/administration (AUC/A) and assets under management are a driver of the Corporation’s trust, investment and other servicing fees, the largest component of noninterest income. |
| As of | | % Change December 31, 2023 vs. |
($ In Billions) | December 31, 2023* | September 30, 2023 | December 31, 2022 | | September 30, 2023 | December 31, 2022 |
Assets Under Custody/Administration | | | | | | |
Asset Servicing | $ | 14,362.6 | | $ | 13,206.2 | | $ | 12,705.5 | | | 9 | % | 13 | % |
Wealth Management | 1,042.3 | | 958.5 | | 898.5 | | | 9 | | 16 | |
Total Assets Under Custody/Administration | $ | 15,404.9 | | $ | 14,164.7 | | $ | 13,604.0 | | | 9 | % | 13 | % |
Assets Under Custody(1) | | | | | | |
Asset Servicing | $ | 10,882.0 | | $ | 10,064.4 | | $ | 9,712.3 | | | 8 | % | 12 | % |
Wealth Management | 1,034.5 | | 951.0 | | 892.3 | | | 9 | | 16 | |
Total Assets Under Custody | $ | 11,916.5 | | $ | 11,015.4 | | $ | 10,604.6 | | | 8 | % | 12 | % |
Assets Under Management | | | | | | |
Asset Servicing | $ | 1,032.0 | | $ | 963.4 | | $ | 898.1 | | | 7 | % | 15 | % |
Wealth Management | 402.5 | | 369.9 | | 351.4 | | | 9 | | 15 | |
Total Assets Under Management | $ | 1,434.5 | | $ | 1,333.3 | | $ | 1,249.5 | | | 8 | % | 15 | % |
(1) Assets Under Custody are a component of Assets Under Custody/Administration.
(*) Client assets for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission.
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TRUST, INVESTMENT AND OTHER SERVICING FEES | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Asset Servicing Trust, Investment and Other Servicing Fees | | | | | | |
Custody and Fund Administration | $ | 420.4 | | $ | 428.1 | | $ | 406.3 | | | (2) | % | 3 | % |
Investment Management | 130.7 | | 137.1 | | 123.8 | | | (5) | | 5 | |
Securities Lending | 22.0 | | 20.4 | | 19.3 | | | 8 | | 14 | |
Other | 38.6 | | 40.4 | | 38.6 | | | (5) | | — | |
Total Asset Servicing | $ | 611.7 | | $ | 626.0 | | $ | 588.0 | | | (2) | % | 4 | % |
| | | | | | |
Wealth Management Trust, Investment and Other Servicing Fees | | | | | | |
Central | $ | 171.9 | | $ | 172.3 | | $ | 162.2 | | | — | % | 6 | % |
East | 121.5 | | 126.1 | | 117.8 | | | (4) | | 3 | |
West | 97.3 | | 95.8 | | 89.5 | | | 2 | | 9 | |
Global Family Office (GFO) | 87.6 | | 91.7 | | 84.6 | | | (4) | | 4 | |
Total Wealth Management | $ | 478.3 | | $ | 485.9 | | $ | 454.1 | | | (2) | % | 5 | % |
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Total Consolidated Trust, Investment and Other Servicing Fees | $ | 1,090.0 | | $ | 1,111.9 | | $ | 1,042.1 | | | (2) | % | 5 | % |
Asset Servicing and Wealth Management trust, investment and other servicing fees are impacted by both one-month and one-quarter lagged asset values.
Total Asset Servicing trust, investment and other servicing fees decreased sequentially and increased from the prior-year quarter.
▪Custody and fund administration fees decreased sequentially primarily due to unfavorable markets. Custody and fund administration fees increased from the prior-year quarter primarily due to favorable markets, favorable currency translation, and new business, partially offset by asset outflows.
▪Investment management fees decreased sequentially primarily due to asset outflows and unfavorable markets. Investment management fees increased from the prior-year quarter primarily due to favorable markets.
Total Wealth Management trust, investment and other servicing fees decreased sequentially and increased from the prior-year quarter.
•Fees in the regions decreased sequentially primarily due to unfavorable markets, partially offset by asset inflows. Fees in the regions increased from the prior-year quarter primarily due to favorable markets, partially offset by product-related asset outflows.
•Fees in GFO decreased sequentially primarily due to asset outflows and unfavorable markets. Fees in GFO increased from the prior-year quarter primarily due to asset inflows and favorable markets.
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NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
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OTHER NONINTEREST INCOME | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Other Noninterest Income | | | | | | |
Foreign Exchange Trading Income | $ | 49.0 | | $ | 51.8 | | $ | 65.4 | | | (5) | % | (25) | % |
Treasury Management Fees | 7.8 | | 7.5 | | 8.3 | | | 2 | | (8) | |
Security Commissions and Trading Income | 33.3 | | 30.9 | | 35.1 | | | 8 | | (5) | |
Other Operating Income | 58.5 | | 68.2 | | 47.3 | | | (14) | | 24 | |
Investment Security Gains (Losses), net | (176.4) | | — | | (213.7) | | | N/M | N/M |
Total Other Noninterest Income (Loss) | $ | (27.8) | | $ | 158.4 | | $ | (57.6) | | | N/M | (52) | % |
N/M - Not meaningful
Foreign exchange trading income decreased sequentially and compared to the prior-year quarter primarily driven by lower client volumes and an unfavorable impact from foreign exchange swap activity.
Other operating income decreased sequentially primarily due to lower income related to existing swap agreements related to Visa Inc. Class B common shares and lower income associated with a market value decrease in supplemental compensation plans. Other operating income increased compared to the prior-year quarter primarily driven by higher income related to existing swap agreements related to Visa Inc. Class B common shares and higher banking and credit-related services fees.
Investment Security Gains (Losses), net reflects the $176.4 million available for sale debt security loss arising from a repositioning of the portfolio during the current quarter. In the prior-year quarter, there was a $213.0 million loss arising from an intent to sell available for sale debt securities also arising from a repositioning of the portfolio.
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NET INTEREST INCOME | | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Net Interest Income | | | | | | |
Interest Income (FTE*) | $ | 2,217.6 | | $ | 1,948.2 | | $ | 1,185.6 | | | 14 % | 87 % |
Interest Expense | 1,716.5 | | 1,478.8 | | 635.6 | | | 16 | 170 |
Net Interest Income (FTE*) | $ | 501.1 | | $ | 469.4 | | $ | 550.0 | | | 7% | (9)% |
Average Earning Assets | $ | 125,025.1 | | $ | 128,254.4 | | $ | 133,788.5 | | | (3)% | (7)% |
Net Interest Margin (FTE*) | 1.59 | % | 1.45 | % | 1.63 | % | | 14 | bps | (4) | bps |
(*) Interest income, net interest income and net interest margin presented on an FTE basis are non-generally accepted accounting principle financial measures that facilitate the analysis of asset yields. Please refer to the Reconciliation to Fully Taxable Equivalent section for further detail.
bps - basis points
Net interest income on an FTE basis increased sequentially primarily due to a favorable balance sheet mix and higher average interest rates. Net interest income on an FTE basis decreased compared to the prior-year quarter primarily due to lower average earning assets, partially offset by higher average interest rates.
The net interest margin on an FTE basis increased sequentially primarily due to a favorable funding mix shift. The net interest margin on an FTE basis decreased from the prior-year quarter primarily due to an unfavorable funding mix shift, partially offset by higher average interest rates.
Average earning assets decreased sequentially primarily due to lower borrowing activity. Average earning assets decreased compared to the prior-year quarter primarily due to lower client deposits, partially offset by increased borrowing activity, the net of which resulted in lower funding of earning assets.
| | |
NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
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PROVISION FOR CREDIT LOSSES | | | | | | |
| As of and for the three-months ended, | | % Change December 31, 2023 vs. |
($ In Millions) | December 31, 2023 | September 30, 2023 | December 31, 2022 | | September 30, 2023 | December 31, 2022 |
Allowance for Credit Losses | | | | | | |
Beginning Allowance for Credit Losses | $ | 211.8 | | $ | 197.5 | | $ | 195.9 | | | 7 | % | 8 | % |
Provision for (Release of) Credit Losses | 11.0 | | 14.0 | | 5.0 | | | N/M | N/M |
Net Recoveries (Charge-Offs) | (2.4) | | 0.3 | | — | | | N/M | N/M |
Ending Allowance for Credit Losses | $ | 220.4 | | $ | 211.8 | | $ | 200.9 | | | 4 | % | 10 | % |
Allowance assigned to: | | | | | | |
Loans | $ | 178.7 | | $ | 166.8 | | $ | 144.3 | | | 7 | % | 24 | % |
Undrawn Loan Commitments and Standby Letters of Credit | 26.9 | | 28.3 | | 38.5 | | | (5) | | (30) | |
Debt Securities and Other Financial Assets | 14.8 | | 16.7 | | 18.1 | | | (12) | | (18) | |
Ending Allowance for Credit Losses | $ | 220.4 | | $ | 211.8 | | $ | 200.9 | | | 4 | % | 10 | % |
N/M - Not meaningful
Q4 2023
The provision in the current quarter was primarily due to an increase in the reserve evaluated on a collective basis and an increase in the reserve evaluated on an individual basis driven by a very small number of borrowers. The reserve evaluated on a collective basis relates to pooled financial assets sharing similar risk characteristics. The increase in the collective basis reserve was driven by methodology updates.
Q3 2023
The provision in the prior quarter was primarily due to an increase in the reserve evaluated on a collective basis, driven by a small number of large new loans and renewals and credit quality deterioration of certain commercial loans, partially offset by a net improvement in the overall macroeconomic outlook at the time.
Q4 2022
The provision in the prior-year quarter was primarily due to an increase in the reserve evaluated on a collective basis, driven by growth in certain commercial portfolios and further deterioration in the macroeconomic outlook at the time, partially offset by improvement in portfolio quality for a commercial segment.
| | |
NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
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NONINTEREST EXPENSE | | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Noninterest Expense | | | | | | |
Compensation | $ | 564.0 | | $ | 558.1 | | $ | 584.3 | | | 1 | % | (3) | % |
Employee Benefits | 102.0 | | 100.8 | | 103.6 | | | 1 | | (2) | |
Outside Services | 235.2 | | 229.6 | | 232.9 | | | 2 | | 1 | |
Equipment and Software | 252.0 | | 232.5 | | 229.4 | | | 8 | | 10 | |
Occupancy | 58.5 | | 58.7 | | 65.7 | | | — | | (11) | |
Other Operating Expense | 176.8 | | 98.5 | | 107.7 | | | 80 | | 64 | |
Total Noninterest Expense | $ | 1,388.5 | | $ | 1,278.2 | | $ | 1,323.6 | | | 9 | % | 5 | % |
End of Period Full-Time Equivalent Employees | 23,100 | | 23,300 | | 23,600 | | | (1) | % | (2) | % |
Compensation expense increased sequentially primarily due to higher agency costs and lower internally developed software related personnel credits. Compensation expense decreased compared to the prior-year quarter primarily due to $30.4 million of severance-related charges in the prior-year quarter and lower incentives, partially offset by higher salary expense and unfavorable currency translation.
Outside services expense increased sequentially primarily due to higher technical services costs and consulting services, partially offset by lower subcustodian expense.
Equipment and software expense increased sequentially and from the prior-year quarter primarily due to higher software amortization and higher software costs.
Occupancy expense decreased from the prior-year quarter primarily due to $14.0 million of charges related to early lease exits in the prior-year quarter, partially offset by higher real estate taxes.
Other operating expense increased sequentially and from the prior-year quarter primarily due to $84.6 million related to the FDIC special assessment.
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PROVISION FOR INCOME TAX | | | | | | |
| | | | | % Change Q4 2023 vs. |
($ In Millions) | Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Net Income | | | | | | |
Income before Income Taxes | $ | 145.8 | | $ | 434.3 | | $ | 190.4 | | | (66) | % | (23) | % |
Provision for Income Taxes | 32.7 | | 106.5 | | 34.7 | | | (69) | (6) | |
Net Income | $ | 113.1 | | $ | 327.8 | | $ | 155.7 | | | (65) | % | (27) | % |
Effective Tax Rate | 22.4 | % | 24.5 | % | 18.2 | % | | (210) | bps | 420 | bps |
bps - basis points
The effective tax rate decreased sequentially primarily due to a higher level of tax benefits from tax-credit investments and tax-exempt income, partially offset by a higher state tax provision and higher net tax impact from international operations as a percentage of earnings. The increase from the prior-year quarter was primarily due to a higher state tax provision and higher net tax impact from international operations, partially offset by a higher level of tax benefits from tax-credit investments and tax-exempt income.
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NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
The Corporation returned approximately $302.4 million to common shareholders in the current quarter through dividends and the repurchase of shares. During the current quarter, the Corporation declared cash dividends totaling $156.2 million to common stockholders. The Corporation repurchased 1,957,885 shares of common stock, including 21,985 withheld to satisfy tax withholding obligations related to share-based compensation, at a total cost of $146.2 million ($74.68 average price per share).
The Corporation also declared cash dividends totaling $4.7 million to preferred stockholders during the current quarter.
The capital ratios of Northern Trust Corporation and its principal subsidiary, The Northern Trust Company, remained strong at December 31, 2023, exceeding the minimum requirements for classification as “well-capitalized” under applicable U.S. regulatory requirements.
The table below provides capital ratios, as well as the required minimum capital ratios, for Northern Trust Corporation and The Northern Trust Company determined by Basel III phased-in requirements.
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| December 31, 2023* | September 30, 2023 | December 31, 2022 | | | |
Capital Ratios - Northern Trust Corporation | Standardized Approach | Advanced Approach | Standardized Approach | Advanced Approach | Standardized Approach | Advanced Approach | | Well-Capitalized Ratios | Minimum Capital Ratios |
Common Equity Tier 1 Capital | 11.4 | % | 13.4 | % | 11.4 | % | 13.2 | % | 10.8 | % | 11.5 | % | | N/A | 4.5 | % |
Tier 1 Capital | 12.3 | | 14.5 | | 12.4 | | 14.3 | | 11.8 | | 12.5 | | | 6.0 | 6.0 | |
Total Capital | 14.2 | | 16.5 | | 14.5 | | 16.5 | | 13.9 | | 14.5 | | | 10.0 | 8.0 | |
Tier 1 Leverage | 8.1 | | 8.1 | | 7.9 | | 7.9 | | 7.1 | | 7.1 | | | N/A | 4.0 | |
Supplementary Leverage | N/A | 8.6 | | N/A | 8.4 | | N/A | 7.9 | | | N/A | 3.0 | |
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| December 31, 2023* | September 30, 2023 | December 31, 2022 | | | |
Capital Ratios - The Northern Trust Company | Standardized Approach | Advanced Approach | Standardized Approach | Advanced Approach | Standardized Approach | Advanced Approach | | Well-Capitalized Ratios | Minimum Capital Ratios |
Common Equity Tier 1 Capital | 12.2 | % | 14.6 | % | 12.3 | % | 14.5 | % | 11.6 | % | 12.4 | % | | 6.5 | % | 4.5 | % |
Tier 1 Capital | 12.2 | | 14.6 | | 12.3 | | 14.5 | | 11.6 | | 12.4 | | | 8.0 | | 6.0 | |
Total Capital | 13.8 | | 16.3 | | 14.2 | | 16.4 | | 13.5 | | 14.2 | | | 10.0 | | 8.0 | |
Tier 1 Leverage | 8.0 | | 8.0 | | 7.8 | | 7.8 | | 6.9 | | 6.9 | | | 5.0 | | 4.0 | |
Supplementary Leverage | N/A | 8.5 | | N/A | 8.3 | | N/A | 7.7 | | | 3.0 | | 3.0 | |
(*) Capital ratios for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission.
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NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
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RECONCILIATION TO FULLY TAXABLE EQUIVALENT |
The following table presents a reconciliation of interest income, net interest income, net interest margin, and total revenue prepared in accordance with generally accepted accounting principles to such measures on an FTE basis, which are non-generally accepted accounting financial measures. Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets. Management believes this presentation provides a clearer indication of these financial measures for comparative purposes. When adjusted to an FTE basis, yields on taxable, nontaxable and partially taxable assets are comparable; however, the adjustment to an FTE basis has no impact on net income.
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| QUARTERS | | | |
| 2023 | | 2022 | | | |
($ in Millions) | FOURTH | THIRD | SECOND | FIRST | | FOURTH | | | |
Net Interest Income | | | | | | | | | |
Interest Income - GAAP | $ | 2,199.6 | | $ | 1,935.0 | | $ | 1,735.0 | | $ | 1,455.4 | | | $ | 1,170.1 | | | | |
Add: FTE Adjustment | 18.0 | | 13.2 | | 13.1 | | 13.2 | | | 15.5 | | | | |
Interest Income (FTE) - Non-GAAP | $ | 2,217.6 | | $ | 1,948.2 | | $ | 1,748.1 | | $ | 1,468.6 | | | $ | 1,185.6 | | | | |
| | | | | | | | | |
Net Interest Income - GAAP | $ | 483.1 | | $ | 456.2 | | $ | 511.5 | | $ | 531.2 | | | $ | 534.5 | | | | |
Add: FTE Adjustment | 18.0 | | 13.2 | | 13.1 | | 13.2 | | | 15.5 | | | | |
Net Interest Income (FTE) - Non-GAAP | $ | 501.1 | | $ | 469.4 | | $ | 524.6 | | $ | 544.4 | | | $ | 550.0 | | | | |
| | | | | | | | | |
Net Interest Margin - GAAP | 1.53 | % | 1.41 | % | 1.53 | % | 1.58 | % | | 1.58 | % | | | |
Net Interest Margin (FTE) - Non-GAAP | 1.59 | % | 1.45 | % | 1.57 | % | 1.62 | % | | 1.63 | % | | | |
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Total Revenue | | | | | | | | | |
Total Revenue - GAAP | $ | 1,545.3 | | $ | 1,726.5 | | $ | 1,757.1 | | $ | 1,744.6 | | | $ | 1,519.0 | | | | |
Add: FTE Adjustment | 18.0 | | 13.2 | | 13.1 | | 13.2 | | | 15.5 | | | | |
Total Revenue (FTE) - Non-GAAP | $ | 1,563.3 | | $ | 1,739.7 | | $ | 1,770.2 | | $ | 1,757.8 | | | $ | 1,534.5 | | | | |
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NORTHERN TRUST CORPORATION FOURTH QUARTER 2023 RESULTS |
| | |
FORWARD LOOKING STATEMENTS |
This release may include statements which constitute “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified typically by words or phrases such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “likely,” “plan,” “goal,” “target,” “strategy,” and similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would,” and “could.” Forward-looking statements include statements, other than those related to historical facts, that relate to Northern Trust’s financial results and outlook, capital adequacy, dividend policy and share repurchase program, accounting estimates and assumptions, credit quality including allowance levels, future pension plan contributions, effective tax rate, anticipated expense levels, contingent liabilities, acquisitions, strategies, market and industry trends, and expectations regarding the impact of accounting pronouncements and legislation. These statements are based on Northern Trust’s current beliefs and expectations of future events or future results, and involve risks and uncertainties that are difficult to predict and subject to change. These statements are also based on assumptions about many important factors, including the factors discussed in Northern Trust’s most recent annual report on Form 10-K and other filings with the U.S. Securities and Exchange Commission, all of which are available on Northern Trust’s website. We caution you not to place undue reliance on any forward-looking statement as actual results may differ materially from those expressed or implied by forward-looking statements. Northern Trust assumes no obligation to update its forward-looking statements.
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WEBCAST OF FOURTH QUARTER EARNINGS CONFERENCE CALL |
Northern Trust’s fourth quarter earnings conference call will be webcast on January 18, 2024. The live call will be conducted at 8:00 a.m. CT and is accessible on Northern Trust’s website at:
https://www.northerntrust.com/about-us/investor-relations
A recording of the live call will be available on Northern Trust’s website following the live event, for approximately four weeks. Participants will need Windows Media or Adobe Flash software. This earnings release can also be accessed at Northern Trust’s website.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has a global presence with offices in 24 U.S. states and Washington, D.C., and across 22 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of December 31, 2023, Northern Trust had assets under custody/administration of US$15.4 trillion, and assets under management of US$1.4 trillion. For more than 130 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit us on northerntrust.com. Follow us on X (formerly Twitter) @NorthernTrust or Northern Trust Corporation on LinkedIn.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Global legal and regulatory information can be found at https://www.northerntrust.com/terms-and-conditions.
| | |
NORTHERN TRUST CORPORATION |
(Supplemental Consolidated Financial Information) |
| | | | | | | | | | | | | | | | | | | | |
STATEMENT OF INCOME DATA | | | | | % Change(1) |
($ In Millions Except Per Share Data) | | | | | Q4 2023 vs. |
| Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Noninterest Income | | | | | | |
Trust, Investment and Other Servicing Fees | $ | 1,090.0 | | $ | 1,111.9 | | $ | 1,042.1 | | | (2) | % | 5 | % |
Foreign Exchange Trading Income | 49.0 | | 51.8 | | 65.4 | | | (5) | | (25) | |
Treasury Management Fees | 7.8 | | 7.5 | | 8.3 | | | 2 | | (8) | |
Security Commissions and Trading Income | 33.3 | | 30.9 | | 35.1 | | | 8 | | (5) | |
Other Operating Income | 58.5 | | 68.2 | | 47.3 | | | (14) | | 24 | |
Investment Security Gains (Losses), net | (176.4) | | — | | (213.7) | | | N/M | N/M |
Total Noninterest Income | 1,062.2 | | 1,270.3 | | 984.5 | | | (16) | | 8 | |
| | | | | | |
Net Interest Income | | | | | | |
Interest Income | 2,199.6 | | 1,935.0 | | 1,170.1 | | | 14 | | 88 | |
Interest Expense | 1,716.5 | | 1,478.8 | | 635.6 | | | 16 | | 170 | |
Net Interest Income | 483.1 | | 456.2 | | 534.5 | | | 6 | | (10) | |
| | | | | | |
Total Revenue | 1,545.3 | | 1,726.5 | | 1,519.0 | | | (10) | | 2 | |
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Provision for Credit Losses | 11.0 | | 14.0 | | 5.0 | | | N/M | N/M |
| | | | | | |
Noninterest Expense | | | | | | |
Compensation | 564.0 | | 558.1 | | 584.3 | | | 1 | | (3) | |
Employee Benefits | 102.0 | | 100.8 | | 103.6 | | | 1 | | (2) | |
Outside Services | 235.2 | | 229.6 | | 232.9 | | | 2 | | 1 | |
Equipment and Software | 252.0 | | 232.5 | | 229.4 | | | 8 | | 10 | |
Occupancy | 58.5 | | 58.7 | | 65.7 | | | — | | (11) | |
Other Operating Expense | 176.8 | | 98.5 | | 107.7 | | | 80 | | 64 | |
Total Noninterest Expense | 1,388.5 | | 1,278.2 | | 1,323.6 | | | 9 | | 5 | |
| | | | | | |
Income before Income Taxes | 145.8 | | 434.3 | | 190.4 | | | (66) | | (23) | |
Provision for Income Taxes | 32.7 | | 106.5 | | 34.7 | | | (69) | | (6) | |
NET INCOME | $ | 113.1 | | $ | 327.8 | | $ | 155.7 | | | (65) | % | (27) | % |
Preferred Stock Dividends | 4.7 | | 16.2 | | 4.7 | | | (71) | — |
NET INCOME APPLICABLE TO COMMON STOCK | $ | 108.4 | | $ | 311.6 | | $ | 151.0 | | | (65) | % | (28) | % |
Earnings Allocated to Participating Securities | 1.9 | | 3.1 | | 2.3 | | | (38) | | (16) | |
Earnings Allocated to Common and Potential Common Shares | $ | 106.5 | | $ | 308.5 | | $ | 148.7 | | | (65) | | (28) | |
| | | | | | |
Per Common Share | | | | | | |
Net Income | | | | | | |
Basic | $ | 0.52 | | $ | 1.49 | | $ | 0.71 | | | (65) | % | (28) | % |
Diluted | 0.52 | | 1.49 | | 0.71 | | | (65) | | (27) | |
| | | | | | |
Average Common Equity | $ | 10,830.6 | | $ | 10,651.7 | | $ | 10,094.5 | | | 2 | % | 7 | % |
Return on Average Common Equity | 4.0 | % | 11.6 | % | 5.9 | % | | | |
Return on Average Assets | 0.33 | % | 0.93 | % | 0.42 | % | | | |
| | | | | | |
Cash Dividends Declared per Common Share | $ | 0.75 | | $ | 0.75 | | $ | 0.75 | | | — | % | — | % |
| | | | | | |
Average Common Shares Outstanding (000s) | | | | | | |
Basic | 206,170 | | 207,022 | 208,423 | | | |
Diluted | 206,484 | | 207,253 | 208,894 | | | |
Common Shares Outstanding (EOP) (000s) | 205,126 | | 207,036 | 208,428 | | | |
(1) Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information.
N/M - Not meaningful
EOP - End of period
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NORTHERN TRUST CORPORATION |
(Supplemental Consolidated Financial Information) |
| | | | | | | | | | | | | | |
STATEMENT OF INCOME DATA | | | | |
($ In Millions Except Per Share Data) | TWELVE MONTHS | | |
| 2023 | 2022 | | % Change(1) |
Noninterest Income | | | | |
Trust, Investment and Other Servicing Fees | $ | 4,361.8 | | $ | 4,432.6 | | | (2) | % |
Foreign Exchange Trading Income | 203.9 | | 288.6 | | | (29) | |
Treasury Management Fees | 31.6 | | 39.3 | | | (20) | |
Security Commissions and Trading Income | 135.0 | | 136.2 | | | (1) | |
Other Operating Income | 228.7 | | 191.3 | | | 19 | |
Investment Security Gains (Losses), net | (169.5) | | (214.0) | | | N/M |
Total Noninterest Income | 4,791.5 | | 4,874.0 | | | (2) | |
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Net Interest Income | | | | |
Interest Income | 7,325.0 | | 2,877.7 | | | 155 |
Interest Expense | 5,343.0 | | 990.5 | | | N/M |
Net Interest Income | 1,982.0 | | 1,887.2 | | | 5 | |
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Total Revenue | 6,773.5 | | 6,761.2 | | | — | |
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Provision for Credit Losses | 24.5 | | 12.0 | | | N/M |
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Noninterest Expense | | | | |
Compensation | 2,321.8 | | 2,248.0 | | | 3 | |
Employee Benefits | 405.2 | | 437.4 | | | (7) | |
Outside Services | 906.5 | | 880.3 | | | 3 | |
Equipment and Software | 945.5 | | 838.8 | | | 13 | |
Occupancy | 232.3 | | 219.1 | | | 6 | |
Other Operating Expense | 472.9 | | 359.3 | | | 32 | |
Total Noninterest Expense | 5,284.2 | | 4,982.9 | | | 6 | |
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Income before Income Taxes | 1,464.8 | | 1,766.3 | | | (17) | |
Provision for Income Taxes | 357.5 | | 430.3 | | | (17) | |
NET INCOME | $ | 1,107.3 | | $ | 1,336.0 | | | (17) | % |
Preferred Stock Dividends | 41.8 | | 41.8 | | | — | |
NET INCOME APPLICABLE TO COMMON STOCK | $ | 1,065.5 | | $ | 1,294.2 | | | (18) | % |
Earnings Allocated to Participating Securities | 11.6 | | 11.8 | | | (1) | |
Earnings Allocated to Common and Potential Common Shares | $ | 1,053.9 | | $ | 1,282.4 | | | (18) | % |
| | | | |
Per Common Share | | | | |
Net Income | | | | |
Basic | $ | 5.09 | | $ | 6.16 | | | (17) | % |
Diluted | 5.08 | | 6.14 | | | (17) | |
| | | | |
Average Common Equity | $ | 10,612.0 | | $ | 10,196.6 | | | 4 | % |
Return on Average Common Equity | 10.0 | % | 12.7 | % | | |
Return on Average Assets | 0.78 | % | 0.88 | % | | |
| | | | |
Cash Dividends Declared per Common Share | $ | 3.00 | | $ | 2.90 | | | 3 | % |
| | | | |
Average Common Shares Outstanding (000s) | | | | |
Basic | 207,248 | | 208,309 | | | |
Diluted | 207,564 | | 208,867 | | | |
Common Shares Outstanding (EOP) (000s) | 205,126 | | 208,428 | | | |
(1)Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information.
N/M - Not meaningful
EOP - End of period
| | |
NORTHERN TRUST CORPORATION |
(Supplemental Consolidated Financial Information) |
| | | | | | | | | | | | | | | | | | | | |
BALANCE SHEET | | | | | | |
($ In Millions) | | | | | % Change(1) |
| | | | | December 31, 2023 vs. |
| December 31, 2023 | September 30, 2023 | December 31, 2022 | | September 30, 2023 | December 31, 2022 |
Assets | | | | | | |
Federal Reserve and Other Central Bank Deposits | $ | 34,281.0 | | $ | 32,266.3 | | $ | 39,961.9 | | | 6 | % | (14) | % |
Interest-Bearing Due from and Deposits with Banks(2) | 5,241.4 | | 5,216.4 | | 4,926.6 | | | — | | 6 | |
Federal Funds Sold | — | | — | | 32.0 | | | — | | (100) |
Securities Purchased under Agreements to Resell | 784.7 | | 384.3 | | 1,070.3 | | | 104 | | (27) | |
Debt Securities | | | | | | |
Available for Sale | 23,089.8 | | 24,342.1 | | 26,699.9 | | | (5) | | (14) | |
Held to Maturity | 26,221.7 | | 24,920.4 | | 25,036.1 | | | 5 | | 5 | |
Trading Account | — | | 0.1 | | 95.2 | | | (99) | | (100) | |
Total Debt Securities | 49,311.5 | | 49,262.6 | | 51,831.2 | | | — | | (5) | |
Loans | 47,617.0 | | 43,577.0 | | 42,893.3 | | | 9 | | 11 | |
Other Interest-Earning Assets(3) | 3,134.0 | | 3,349.3 | | 1,769.4 | | | (6) | | 77 | |
Total Earning Assets | 140,369.6 | | 134,055.9 | | 142,484.7 | | | 5 | | (1) | |
Allowance for Credit Losses | (192.3) | | (182.7) | | (161.1) | | | 5 | | 19 | |
Cash and Due from Banks and Other Central Bank Deposits(4) | 1,534.3 | | 1,912.4 | | 1,737.2 | | | (20) | | (12) | |
Buildings and Equipment | 502.2 | | 465.0 | | 500.5 | | | 8 | | — | |
Client Security Settlement Receivables | 212.6 | | 147.6 | | 1,698.3 | | | 44 | | (87) | |
Goodwill | 702.3 | | 692.8 | | 691.3 | | | 1 | | 2 | |
Other Assets | 7,654.4 | | 9,239.6 | | 8,085.8 | | | (17) | | (5) | |
Total Assets | $ | 150,783.1 | | $ | 146,330.6 | | $ | 155,036.7 | | | 3 | % | (3) | % |
Liabilities and Stockholders’ Equity | | | | | | |
Interest-Bearing Deposits | | | | | | |
Savings, Money Market and Other | $ | 25,252.1 | | $ | 24,362.6 | | $ | 31,128.6 | | | 4 | % | (19) | % |
Savings Certificates and Other Time | 4,109.7 | | 4,038.6 | | 1,981.3 | | | 2 | | 107 | |
Non-U.S. Offices - Interest-Bearing | 63,971.1 | | 60,826.9 | | 65,481.9 | | | 5 | | (2) | |
Total Interest-Bearing Deposits | 93,332.9 | | 89,228.1 | | 98,591.8 | | | 5 | | (5) | |
Federal Funds Purchased | 3,045.4 | | 5,539.3 | | 1,896.9 | | | (45) | | 61 | |
Securities Sold under Agreements to Repurchase | 784.7 | | 545.9 | | 567.2 | | | 44 | | 38 | |
Other Borrowings(5) | 6,567.8 | | 6,870.9 | | 7,592.3 | | | (4) | | (13) | |
Senior Notes | 2,773.2 | | 2,688.9 | | 2,724.2 | | | 3 | | 2 | |
Long-Term Debt | 4,065.0 | | 4,060.7 | | 2,066.2 | | | — | | 97 | |
Total Interest-Related Funds | 110,569.0 | | 108,933.8 | | 113,438.6 | | | 2 | | (3) | |
Demand and Other Noninterest-Bearing Deposits | 22,831.1 | | 20,937.8 | | 25,340.3 | | | 9 | | (10) | |
Other Liabilities | 5,485.1 | | 4,611.8 | | 4,998.3 | | | 19 | | 10 | |
Total Liabilities | 138,885.2 | | 134,483.4 | | 143,777.2 | | | 3 | | (3) | |
Common Equity | 11,013.0 | | 10,962.3 | | 10,374.6 | | | — | | 6 | |
Preferred Equity | 884.9 | | 884.9 | | 884.9 | | | — | | — | |
Total Equity | 11,897.9 | | 11,847.2 | | 11,259.5 | | | — | | 6 | |
Total Liabilities and Stockholders’ Equity | $ | 150,783.1 | | $ | 146,330.6 | | $ | 155,036.7 | | | 3 | % | (3) | % |
(1) Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information.
(2) Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC.
(3) Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC.
(4) Cash and Due from Banks and Other Central Bank Deposits includes the noninterest-bearing component of Federal Reserve and Other Central Bank Deposits as presented on the consolidated balance sheets in our periodic filings with the SEC.
(5) Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago.
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NORTHERN TRUST CORPORATION |
(Supplemental Consolidated Financial Information) |
| | | | | | | | | | | | | | | | | | | | |
AVERAGE BALANCE SHEET | | | | | | |
($ In Millions) | | | | | % Change(1) |
| | | | | Q4 2023 vs. |
| Q4 2023 | Q3 2023 | Q4 2022 | | Q3 2023 | Q4 2022 |
Assets | | | | | | |
Federal Reserve and Other Central Bank Deposits | $ | 25,951.3 | | $ | 28,000.8 | | $ | 32,755.2 | | | (7) | % | (21) | % |
Interest-Bearing Due from and Deposits with Banks(2) | 4,261.6 | | 4,301.4 | | 4,186.1 | | | (1) | | 2 | |
Federal Funds Sold | 1.0 | | 1.2 | | 14.0 | | | (20) | | (93) | |
Securities Purchased under Agreements to Resell | 573.1 | | 950.8 | | 1,165.5 | | | (40) | | (51) | |
Debt Securities | | | | | | |
Available for Sale | 23,469.9 | | 24,430.7 | | 26,742.4 | | | (4) | | (12) | |
Held to Maturity | 25,685.2 | | 25,919.2 | | 25,135.3 | | | (1) | | 2 | |
Trading Account | 0.2 | | 0.4 | | 46.4 | | | (56) | | (100) | |
Total Debt Securities | 49,155.3 | | 50,350.3 | | 51,924.1 | | | (2) | | (5) | |
Loans | 42,170.0 | | 42,210.4 | | 42,329.4 | | | — | | — | |
Other Interest-Earning Assets(3) | 2,912.8 | | 2,439.5 | | 1,414.2 | | | 19 | | 106 | |
Total Earning Assets | 125,025.1 | | 128,254.4 | | 133,788.5 | | | (3) | | (7) | |
Allowance for Credit Losses | (182.5) | | (170.4) | | (154.6) | | | 7 | | 18 | |
Cash and Due from Banks and Other Central Bank Deposits(4) | 1,754.6 | | 1,694.6 | | 1,773.7 | | | 4 | | (1) | |
Buildings and Equipment | 486.4 | | 474.1 | | 491.0 | | | 3 | | (1) | |
Client Security Settlement Receivables | 205.9 | | 350.3 | | 1,809.9 | | | (41) | | (89) | |
Goodwill | 696.4 | | 698.9 | | 685.8 | | | — | | 2 | |
Other Assets | 8,602.8 | | 8,899.7 | | 9,409.3 | | | (3) | | (9) | |
Total Assets | $ | 136,588.7 | | $ | 140,201.6 | | $ | 147,803.6 | | | (3) | % | (8) | % |
Liabilities and Stockholders’ Equity | | | | | | |
Interest-Bearing Deposits | | | | | | |
Savings, Money Market and Other | $ | 23,888.7 | | $ | 22,624.9 | | $ | 28,488.7 | | | 6 | % | (16) | % |
Savings Certificates and Other Time | 4,279.0 | | 3,665.2 | | 1,610.5 | | | 17 | | 166 | |
Non-U.S. Offices - Interest-Bearing | 56,970.9 | | 58,680.5 | | 64,024.0 | | | (3) | | (11) | |
Total Interest-Bearing Deposits | 85,138.6 | | 84,970.6 | | 94,123.2 | | | — | | (10) | |
Federal Funds Purchased | 3,906.0 | | 5,935.9 | | 2,704.7 | | | (34) | | 44 | |
Securities Sold under Agreements to Repurchase | 364.5 | | 426.0 | | 392.4 | | | (14) | | (7) | |
Other Borrowings(5) | 6,960.8 | | 10,981.7 | | 7,933.2 | | | (37) | | (12) | |
Senior Notes | 2,714.2 | | 2,713.2 | | 2,721.5 | | | — | | — | |
Long-Term Debt | 4,064.1 | | 2,126.9 | | 1,718.6 | | | 91 | | 136 | |
Total Interest-Related Funds | 103,148.2 | | 107,154.3 | | 109,593.6 | | | (4) | | (6) | |
Demand and Other Noninterest-Bearing Deposits | 16,450.4 | | 16,792.5 | | 22,186.3 | | | (2) | | (26) | |
Other Liabilities | 5,274.6 | | 4,718.2 | | 5,044.3 | | | 12 | | 5 | |
Total Liabilities | 124,873.2 | | 128,665.0 | | 136,824.2 | | | (3) | | (9) | |
Common Equity | 10,830.6 | | 10,651.7 | | 10,094.5 | | | 2 | | 7 | |
Preferred Equity | 884.9 | | 884.9 | | 884.9 | | | — | | — | |
Total Equity | 11,715.5 | | 11,536.6 | | 10,979.4 | | | 2 | | 7 | |
Total Liabilities and Stockholders’ Equity | $ | 136,588.7 | | $ | 140,201.6 | | $ | 147,803.6 | | | (3) | % | (8) | % |
(1) Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information.
(2) Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC.
(3) Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC.
(4) Cash and Due from Banks and Other Central Bank Deposits includes the noninterest-bearing component of Federal Reserve and Other Central Bank Deposits as presented on the consolidated balance sheets in our periodic filings with the SEC.
(5) Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago.
| | |
NORTHERN TRUST CORPORATION |
(Supplemental Consolidated Financial Information) |
| | | | | | | | | | | | | | | | | | | | | | | |
QUARTERLY TREND DATA | QUARTERS |
($ In Millions Except Per Share Data) | 2023 | | 2022 |
| FOURTH | | THIRD | SECOND | FIRST | | FOURTH |
Net Income Summary | | | | | | | |
Trust, Investment and Other Servicing Fees | $ | 1,090.0 | | | $ | 1,111.9 | | $ | 1,096.3 | | $ | 1,063.6 | | | $ | 1,042.1 | |
Other Noninterest Income | (27.8) | | | 158.4 | | 149.3 | | 149.8 | | | (57.6) | |
Net Interest Income | 483.1 | | | 456.2 | | 511.5 | | 531.2 | | | 534.5 | |
Total Revenue | 1,545.3 | | | 1,726.5 | | 1,757.1 | | 1,744.6 | | | 1,519.0 | |
Provision for (Release of) Credit Losses | 11.0 | | | 14.0 | | (15.5) | | 15.0 | | | 5.0 | |
Noninterest Expense | 1,388.5 | | | 1,278.2 | | 1,331.9 | | 1,285.6 | | | 1,323.6 | |
Income before Income Taxes | 145.8 | | | 434.3 | | 440.7 | | 444.0 | | | 190.4 | |
Provision for Income Taxes | 32.7 | | | 106.5 | | 108.9 | | 109.4 | | | 34.7 | |
Net Income | $ | 113.1 | | | $ | 327.8 | | $ | 331.8 | | $ | 334.6 | | | $ | 155.7 | |
| | | | | | | |
Per Common Share | | | | | | | |
Net Income - Basic | $ | 0.52 | | | $ | 1.49 | | $ | 1.56 | | $ | 1.51 | | | $ | 0.71 | |
- Diluted | 0.52 | | | 1.49 | | 1.56 | | 1.51 | | | 0.71 | |
Cash Dividends Declared per Common Share | 0.75 | | | 0.75 | | 0.75 | | 0.75 | | | 0.75 | |
Book Value (EOP) | 53.69 | | | 52.95 | | 51.94 | | 51.37 | | | 49.78 | |
Market Value (EOP) | 84.38 | | | 69.48 | | 74.14 | | 88.13 | | | 88.49 | |
| | | | | | | |
Financial Ratios | | | | | | | |
Return on Average Common Equity | 4.0 | % | | 11.6 | % | 12.4 | % | 12.4 | % | | 5.9 | % |
Return on Average Assets | 0.33 | | | 0.93 | | 0.91 | | 0.92 | | | 0.42 | |
Net Interest Margin (GAAP) | 1.53 | | | 1.41 | | 1.53 | | 1.58 | | | 1.58 | |
Net Interest Margin (FTE*) | 1.59 | | | 1.45 | | 1.57 | | 1.62 | | | 1.63 | |
| | | | | | | |
Assets Under Custody / Administration ($ in Billions) - End Of Period | | | | | | | |
Asset Servicing | $ | 14,362.6 | | | $ | 13,206.2 | | $ | 13,483.5 | | $ | 13,221.5 | | | $ | 12,705.5 | |
Wealth Management | 1,042.3 | | | 958.5 | | 995.4 | | 953.3 | | | 898.5 | |
Total Assets Under Custody / Administration | $ | 15,404.9 | | | $ | 14,164.7 | | $ | 14,478.9 | | $ | 14,174.8 | | | $ | 13,604.0 | |
| | | | | | | |
Assets Under Custody ($ In Billions) - End Of Period | | | | | | | |
Asset Servicing | $ | 10,882.0 | | | $ | 10,064.4 | | $ | 10,295.7 | | $ | 10,065.6 | | | $ | 9,712.3 | |
Wealth Management | 1,034.5 | | | 951.0 | | 989.1 | | 947.6 | | | 892.3 | |
Total Assets Under Custody | $ | 11,916.5 | | | $ | 11,015.4 | | $ | 11,284.8 | | $ | 11,013.2 | | | $ | 10,604.6 | |
| | | | | | | |
Assets Under Management ($ In Billions) - End Of Period | | | | | | | |
Asset Servicing | $ | 1,032.0 | | | $ | 963.4 | | $ | 989.8 | | $ | 962.1 | | | $ | 898.1 | |
Wealth Management | 402.5 | | | 369.9 | | 376.0 | | 368.3 | | | 351.4 | |
Total Assets Under Management | $ | 1,434.5 | | | $ | 1,333.3 | | $ | 1,365.8 | | $ | 1,330.4 | | | $ | 1,249.5 | |
| | | | | | | |
Asset Quality ($ In Millions) - End Of Period | | | | | | | |
Nonaccrual Loans | $ | 63.6 | | | $ | 68.8 | | $ | 47.1 | | $ | 48.9 | | | $ | 45.9 | |
Other Real Estate Owned (OREO) | 1.5 | | | 0.3 | | 0.3 | | — | | | — | |
Total Nonaccrual Assets | $ | 65.1 | | | $ | 69.1 | | $ | 47.4 | | $ | 48.9 | | | $ | 45.9 | |
Nonaccrual Assets / Loans and OREO | 0.14 | % | | 0.16 | % | 0.11 | % | 0.12 | % | | 0.11 | % |
Gross Charge-offs | $ | (3.1) | | | $ | (0.8) | | $ | (0.8) | | $ | (4.0) | | | $ | (0.5) | |
Gross Recoveries | 0.7 | | | 1.1 | | 0.8 | | 1.1 | | | 0.5 | |
Net Recoveries (Charge-offs) | $ | (2.4) | | | $ | 0.3 | | $ | — | | $ | (2.9) | | | $ | — | |
Annualized Net Recoveries (Charge-offs) to Avg Loans | (0.02) | % | | — | % | — | % | (0.03) | % | | — | % |
Allowance for Credit Losses Assigned to: | | | | | | | |
Loans | $ | 178.7 | | | $ | 166.8 | | $ | 152.5 | | $ | 159.9 | | | $ | 144.3 | |
Undrawn Loan Commitments and Standby Letters of Credit | 26.9 | | | 28.3 | | 26.0 | | 34.3 | | | 38.5 | |
Debt Securities and Other Financial Assets | 14.8 | | | 16.7 | | 19.0 | | 18.8 | | | 18.1 | |
Loans Allowance / Nonaccrual Loans | 2.8 | x | | 2.4 | x | 3.2 | x | 3.3 | x | | 3.1 | x |
| | | | | | | |
(*) Net interest margin presented on an FTE basis is a non-generally accepted accounting principle financial measure that facilitates the analysis of asset yields. Please refer to the Reconciliation to Fully Taxable Equivalent section for further detail.
northerntrust.com / © 2023 Northern Trust Exhibit 99.2
northerntrust.com / © 2023 Northern Trust 2 130+ years of strength, stability & stewardship Disciplined, client-centric strategy Product leadership & innovation Highest standards of client service Solutions-focused technology & integrated operating platform
northerntrust.com / © 2023 Northern Trust 33
Financial Highlights & Key Metrics northerntrust.com / © 2023 Northern Trust 4 ¹ Revenue and profit margin (pre-tax) stated on a fully taxable equivalent (FTE) basis are non-GAAP financial measures. A reconciliation to reported revenue and reported profit margin (pre-tax) prepared in accordance with U.S. generally accepted accounting principles (GAAP) is included in the Appendix on page 12. ² Actual numbers for all periods, not % change. ³ Client assets for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission. N/M - Not meaningful RESULTS INCLUDE IMPACT OF NOTABLE ITEMS $ in millions (except EPS and as noted) % CHANGE VS. 4Q 2023 3Q 2023 4Q 2022 Revenue (FTE1) $ 1,563.3 (10) % 2 % Noninterest Expense $ 1,388.5 9 % 5 % Provision for Credit Losses 11.0 N/M N/M Net Income $ 113.1 (65) % (27) % Diluted Earnings per Share $ 0.52 (65) % (27) % Return on Average Common Equity2 4.0 % 11.6 % 5.9 % Profit Margin (Pre-Tax)1,2 10.5 % 25.7 % 13.4 % Expense to Trust Fee Ratio2 127 % 115 % 127 % Assets under Custody / Administration3 (AUC/A) (in billions) $ 15,404.9 9 % 13 % Assets under Custody3 (AUC) (in billions) $ 11,916.5 8 % 12 % Assets under Management3 (AUM) (in billions) $ 1,434.5 8 % 15 % Notable Items: 4Q23 Pre-tax • $176.4 million investment security loss • $84.6 million Federal Deposit Insurance Corporation (FDIC) special assessment 4Q22 Pre-tax • $213.0 million investment security loss • $32.0 million severance-related charge • $14.0 million occupancy charge • $6.8 million pension settlement charge
Asset Servicing Highlights northerntrust.com / © 2023 Northern Trust 5 % CHANGE VS. Asset Servicing Client Assets¹ (in billions): 4Q 2023 3Q 2023 4Q 2022 Assets under Custody / Administration (AUC/A) $ 14,362.6 9 % 13 % Assets under Custody (AUC) $ 10,882.0 8 % 12 % Assets under Management (AUM) $ 1,032.0 7 % 15 % Securities Lending Collateral $ 167.4 3 % 13 % $588.0 $603.0 $621.2 $626.0 $611.7 $406.3 $413.6 $427.4 $428.1 $420.4 $123.8 $126.2 $134.1 $137.1 $130.7 $19.3 $19.1 $21.5 $20.4 $22.0$38.6 $44.1 $38.2 $40.4 $38.6 Other Securities Lending Investment Management Custody and Fund Administration 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 Asset Servicing Revenues ($ in millions) +4% (2)% Categories may not sum due to rounding. ¹ Client assets for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission.
Wealth Management Highlights northerntrust.com / © 2023 Northern Trust 6 % CHANGE VS. Wealth Management Client Assets¹ (in billions): 4Q 2023 3Q 2023 4Q 2022 Assets under Custody / Administration (AUC/A) $ 1,042.3 9 % 16 % Assets under Custody (AUC) $ 1,034.5 9 % 16 % Assets under Management (AUM) $ 402.5 9 % 15 % $454.1 $460.6 $475.1 $485.9 $478.3 $162.2 $163.6 $166.0 $172.3 $171.9 $117.8 $119.8 $124.1 $126.1 $121.5 $89.5 $91.2 $93.7 $95.8 $97.3 $84.6 $86.0 $91.3 $91.7 $87.6 Global Family Office (GFO) West East Central 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 Wealth Management Revenues ($ in millions) +5% (2)% Categories may not sum due to rounding. ¹ Client assets for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission.
$550.0 $544.4 $524.6 $469.4 $501.1 Net Interest Income (FTE¹) 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 Net Interest Income and Balance Sheet Trends northerntrust.com / © 2023 Northern Trust 7 Categories may not sum due to rounding. 1 Net interest income and net interest margin stated on an FTE basis are non-GAAP financial measures. A reconciliation of these measures to reported results prepared in accordance with U.S. GAAP is included in the Appendix on page 12. ² Other Earning Assets includes Interest-Bearing Due from and Deposits with Banks, Federal Funds Sold, Securities Purchased under Agreements to Resell, and Other Interest-Earning Assets. $133.8 $136.0 $134.1 $128.3 $125.0 $32.8 $36.6 $34.4 $28.0 $26.0 $51.9 $50.4 $49.6 $50.4 $49.2 $42.3 $42.0 $42.4 $42.2 $42.2 $6.8 $6.9 $7.8 $7.7 $7.7 Other Earning Assets² Loans Debt Securities Federal Reserve and Other Central Bank Deposits 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 1.63% 1.62% 1.57% 1.45% 1.59% Net Interest Margin (FTE¹) Average Earning Assets ($ in billions) Net Interest Income (FTE1) ($ in millions) (9)%(7)% (3)% +7%
Noninterest Expense northerntrust.com / © 2023 Northern Trust 8Categories may not sum due to rounding. Expense Notes • Expenses included the following: • Severance-related charge of $38.7 million in 2Q23 ($36.7 million in Compensation expense and $2.0 million in Outside Services expense); $32.0 million in 4Q22 ($30.4 million in Compensation expense and $1.6 million in Outside Services) • Equipment and Software credit of $4.1 million in 3Q23 • FDIC special assessment in Other Operating Expense of $84.6 million in 4Q23 • Write-off of an investment in a client capability in Other Operating Expense of $25.6 million in 2Q23 • Occupancy charge of $3.0 million in 3Q23; $9.8 million in 1Q23; and $14.0 million in 4Q22 • Pension settlement charge of $6.8 million in 4Q22 $1,323.6 $1,285.6 $1,331.9 $1,278.2 $1,388.5 $687.9 $696.2 $705.9 $658.9 $666.0 $232.9 $210.8 $230.9 $229.6 $235.2 $229.4 $231.7 229.3 $232.5 $252.0 $65.7 $61.3 $53.8 $58.7 $58.5 $107.7 $85.6 $112.0 $98.5 $176.8 Other Operating Expense Occupancy Equipment and Software Outside Services Compensation and Employee Benefits 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 Total Noninterest Expense ($ in millions) +5% +9%
Highlights & Key Metrics: Full Year 2023 northerntrust.com / © 2023 Northern Trust 9 ¹ Revenue and profit margin (pre-tax) stated on a fully taxable equivalent (FTE) basis are non-GAAP financial measures. A reconciliation to reported revenue and reported profit margin (pre-tax) prepared in accordance with U.S. GAAP is included in the Appendix on page 12. ² Actual numbers for all periods, not % change. ³ Client assets for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission. N/M - Not meaningful RESULTS INCLUDE IMPACT OF NOTABLE ITEMS $ in millions (except EPS and as noted) % CHANGE VS. 2023 2022 Revenue (FTE1) $ 6,831.0 — Noninterest Expense $ 5,284.2 6 % Provision for Credit Losses 24.5 N/M Net Income $ 1,107.3 (17) % Diluted Earnings per Share $ 5.08 (17) % Return on Average Common Equity2 10.0 % 12.7 % Profit Margin (Pre-Tax)1,2 22.3 % 26.6 % Expense to Trust Fee Ratio2 121 % 112 % Assets under Custody / Administration3 (AUC/A) (in billions) $ 15,404.9 13 % Assets under Custody3 (AUC) (in billions) $ 11,916.5 12 % Assets under Management3 (AUM) (in billions) $ 1,434.5 15 % Notable Items: 2023 Pre-tax • $176.4 million investment security loss • $84.6 million FDIC special assessment • $38.7 million severance-related charge • $25.6 million client capability charge • $12.8 million occupancy charge • $6.9 million investment security gain 2022 Pre-tax • $213.0 million investment security loss • $44.1 million pension settlement charge • $32.0 million severance-related charge • $14.0 million occupancy charge
Standardized Tier 1 Leverage Ratio 7.1% 7.3% 7.4% 7.9% 8.1% 4Q22 1Q23 2Q23 3Q23 4Q23 10.8% 11.3% 11.3% 11.4% 11.4% 4Q22 1Q23 2Q23 3Q23 4Q23 Capital Update northerntrust.com / © 2023 Northern Trust 10 Capital Highlights • Robust capital and liquidity • $10.2 billion in Tier 1 capital • 55% of deposits covered by highly liquid assets including 30% by cash and central bank deposits • Declared $156.2 million in common stock dividends and $4.7 million in preferred stock dividends in 4Q23 • Repurchased $146.2 million of common stock in 4Q23; totaling $347.5 million for 2023 • Unrealized MTM loss on available- for-sale securities of $923.9 million as of December 31, 2023 Northern Trust Corporation Capital Ratios 4Q 2023 CAPITAL RATIOS STANDARDIZED APPROACH ADVANCED APPROACH Common Equity Tier 1 Capital 11.4% 13.4% Tier 1 Capital 12.3% 14.5% Total Capital 14.2% 16.5% Tier 1 Leverage 8.1% 8.1% Supplementary Leverage N/A 8.6% Capital ratios for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission. Standardized Common Equity Tier 1 Ratio
The following table presents a reconciliation of interest income, net interest income, net interest margin, total revenue, pre-tax income, and profit margin (pre-tax) prepared in accordance with GAAP to such measures on a fully taxable equivalent (FTE) basis, which are non-GAAP financial measures. Management believes this presentation provides a clearer indication of these financial measures for comparative purposes. The adjustment to an FTE basis has no impact on net income. Reconciliation of Non-GAAP Financial Measures northerntrust.com / © 2023 Northern Trust 12 QUARTERS YEARS 2023 2022 2023 2022 ($ in Millions) FOURTH THIRD SECOND FIRST FOURTH Net Interest Income Interest Income - GAAP $ 2,199.6 $ 1,935.0 $ 1,735.0 $ 1,455.4 $ 1,170.1 $ 7,325.0 $ 2,877.7 Add: FTE Adjustment 18.0 13.2 13.1 13.2 15.5 57.5 45.6 Interest Income (FTE) - Non-GAAP $ 2,217.6 $ 1,948.2 $ 1,748.1 $ 1,468.6 $ 1,185.6 $ 7,382.5 $ 2,923.3 Net Interest Income - GAAP $ 483.1 $ 456.2 $ 511.5 $ 531.2 $ 534.5 $ 1,982.0 $ 1,887.2 Add: FTE Adjustment 18.0 13.2 13.1 13.2 15.5 57.5 45.6 Net Interest Income (FTE) - Non-GAAP $ 501.1 $ 469.4 $ 524.6 $ 544.4 $ 550.0 $ 2,039.5 $ 1,932.8 Net Interest Margin - GAAP 1.53 % 1.41 % 1.53 % 1.58 % 1.58 % 1.52 % 1.36 % Net Interest Margin (FTE) - Non-GAAP 1.59 % 1.45 % 1.57 % 1.62 % 1.63 % 1.56 % 1.39 % Total Revenue Total Revenue - GAAP $ 1,545.3 $ 1,726.5 $ 1,757.1 $ 1,744.6 $ 1,519.0 $ 6,773.5 $ 6,761.2 Add: FTE Adjustment 18.0 13.2 13.1 13.2 15.5 57.5 45.6 Total Revenue (FTE) - Non-GAAP $ 1,563.3 $ 1,739.7 $ 1,770.2 $ 1,757.8 $ 1,534.5 $ 6,831.0 $ 6,806.8 Pre-Tax Income Pre-Tax Income - GAAP $ 145.8 $ 434.3 $ 440.7 $ 444.0 $ 190.4 $ 1,464.8 $ 1,766.3 Add: FTE Adjustment 18.0 13.2 13.1 13.2 15.5 57.5 45.6 Pre-Tax Income (FTE) - Non-GAAP $ 163.8 $ 447.5 $ 453.8 $ 457.2 0$ 205.9 $ 1,522.3 $ 1,811.9 Profit Margin (Pre-Tax) Profit Margin (Pre-Tax) - GAAP 9.4 % 25.2 % 25.1 % 25.4 % 12.5 % 21.6 % 26.1 % Profit Margin (Pre-Tax) (FTE) - Non-GAAP 10.5 % 25.7 % 25.6 % 26.0 % 13.4 % 22.3 % 26.6 %
Forward-looking Statements northerntrust.com / © 2023 Northern Trust 13 This presentation may include statements which constitute “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified typically by words or phrases such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “likely,” “plan,” “goal,” “target,” “strategy,” and similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would,” and “could.” Forward-looking statements include statements, other than those related to historical facts, that relate to Northern Trust’s financial results and outlook, capital adequacy, dividend policy and share repurchase program, accounting estimates and assumptions, credit quality including allowance levels, future pension plan contributions, effective tax rate, anticipated expense levels, contingent liabilities, acquisitions, strategies, market and industry trends, and expectations regarding the impact of accounting pronouncements and legislation. These statements are based on Northern Trust’s current beliefs and expectations of future events or future results, and involve risks and uncertainties that are difficult to predict and subject to change. These statements are also based on assumptions about many important factors, including the factors discussed in Northern Trust’s most recent annual report on Form 10-K and other filings with the U.S. Securities and Exchange Commission, all of which are available on Northern Trust’s website. We caution you not to place undue reliance on any forward- looking statement as actual results may differ materially from those expressed or implied by forward-looking statements. Northern Trust assumes no obligation to update its forward-looking statements. This presentation should be reviewed together with Northern Trust Corporation’s Fourth Quarter 2023 earnings press release.
Financial Trends
Fourth Quarter 2023
January 18, 2024
Please direct inquiries to:
| | |
Jennifer Childe |
Senior Vice President, Director of Investor Relations |
(312) 444-3290 or jennifer.childe@ntrs.com |
|
Grace Higgins |
Second Vice President, Investor Relations |
(847) 946-9113 or grace.higgins@ntrs.com |
The historical financial results and trends reflected in this report are not indicative of future financial results and trends for Northern Trust Corporation. This report should be read in conjunction with the Corporation's Fourth Quarter 2023 earnings press release, 2022 Annual Report to Shareholders, and periodic reports to the Securities and Exchange Commission, all of which contain additional information about factors that could affect the Corporation's future financial results and trends. The Corporation assumes no obligation to update this report.
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TABLE OF CONTENTS | | | |
| | | |
| 1 | | 7 |
| Financial Summary | | Balance Sheet Mix Trends |
| | | |
| 2 | | 8 |
| Income Statement | | Interest Rate Trends |
| | | |
| 3 | | 9 |
| Net Income Trends | | Asset Quality |
| | | |
| 4 | | 10 |
| Fee Detail | | Trust Assets |
| | | |
| 5 | | 11 |
| Balance Sheet (EOP) | | Reconciliation to FTE |
| | | |
| 6 | | 12 |
| Balance Sheet Trends | | Reconciliation to FTE (Ratios) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Northern Trust Corporation | | |
FINANCIAL SUMMARY | | |
($ in Millions except per share information) | | |
| | | | | | | | | | | | | | | | 2022 | | 2023 | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | | | | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | |
| | | | | | | | | | | | Profitability: | | | | | | | | | | | | | | | | | | |
| | $ | 1,492.2 | | | $ | 1,209.3 | | | $ | 1,545.3 | | | $ | 1,336.0 | | | $ | 1,107.3 | | | Net Income | | $ | 389.3 | | | $ | 396.2 | | | $ | 394.8 | | | $ | 155.7 | | | $ | 334.6 | | | $ | 331.8 | | | $ | 327.8 | | | $ | 113.1 | | | |
| | 1,428.9 | | | 1,141.0 | | | 1,490.6 | | | 1,282.4 | | | 1,053.9 | | | Earnings Allocated to Common and Potential | | 370.0 | | | 388.3 | | | 375.4 | | | 148.7 | | | 315.2 | | | 323.7 | | | 308.5 | | | 106.5 | | | |
| | | | | | | | | | | | | Common Shares | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 6.66 | | | $ | 5.48 | | | $ | 7.16 | | | $ | 6.16 | | | $ | 5.09 | | | Basic Earnings Per Share | | $ | 1.78 | | | $ | 1.86 | | | $ | 1.80 | | | $ | 0.71 | | | $ | 1.51 | | | $ | 1.56 | | | $ | 1.49 | | | $ | 0.52 | | | |
| | 6.63 | | | 5.46 | | | 7.14 | | | 6.14 | | | 5.08 | | | Diluted Earnings Per Share | | 1.77 | | | 1.86 | | | 1.80 | | | 0.71 | | | 1.51 | | | 1.56 | | | 1.49 | | | 0.52 | | | |
| | — | % | | (18 | %) | | 31 | % | | (14 | %) | | (17 | %) | | Diluted EPS Growth over Previous Year | | 4 | % | | 8 | % | | — | % | | (63 | %) | | (15 | %) | | (16 | %) | | (17 | %) | | (27 | %) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 14.9 | % | | 11.2 | % | | 13.9 | % | | 12.7 | % | | 10.0 | % | | Return on Average Common Equity | | 14.2 | % | | 15.7 | % | | 14.9 | % | | 5.9 | % | | 12.4 | % | | 12.4 | % | | 11.6 | % | | 4.0 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1.27 | % | | 0.88 | % | | 0.99 | % | | 0.88 | % | | 0.78 | % | | Return on Average Assets | | 0.97 | % | | 1.03 | % | | 1.07 | % | | 0.42 | % | | 0.92 | % | | 0.91 | % | | 0.93 | % | | 0.33 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 32.4 | % | | 27.1 | % | | 31.5 | % | | 26.6 | % | | 22.3 | % | | Profit Margin (pre-tax) (FTE)(1) | | 30.0 | % | | 31.0 | % | | 30.4 | % | | 13.4 | % | | 26.0 | % | | 25.6 | % | | 25.7 | % | | 10.5 | % | | |
| | 24.4 | % | | 19.7 | % | | 23.8 | % | | 19.6 | % | | 16.2 | % | | Profit Margin (after-tax) (FTE)(1) | | 22.6 | % | | 22.3 | % | | 22.3 | % | | 10.1 | % | | 19.0 | % | | 18.7 | % | | 18.8 | % | | 7.2 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 72.0 | % | | 75.9 | % | | 78.2 | % | | 71.6 | % | | 70.1 | % | | Noninterest Income to Total Revenue (FTE)(1) | | 77.5 | % | | 73.6 | % | | 70.3 | % | | 64.2 | % | | 69.0 | % | | 70.4 | % | | 73.0 | % | | 67.9 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 63.1 | % | | 65.1 | % | | 67.1 | % | | 65.1 | % | | 63.9 | % | | Trust Fees to Total Revenue (FTE)(1) | | 67.7 | % | | 64.2 | % | | 61.0 | % | | 67.9 | % | | 60.5 | % | | 61.9 | % | | 63.9 | % | | 69.7 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 23.2 | % | | 25.7 | % | | 23.1 | % | | 24.4 | % | | 24.4 | % | | Effective Tax Rate (US GAAP) | | 23.8 | % | | 26.7 | % | | 24.7 | % | | 18.2 | % | | 24.6 | % | | 24.7 | % | | 24.5 | % | | 22.4 | % | | |
| | 24.5 | % | | 27.2 | % | | 24.5 | % | | 26.3 | % | | 27.3 | % | | Effective Tax Rate (FTE)(1) | | 24.8 | % | | 28.2 | % | | 26.4 | % | | 24.4 | % | | 26.8 | % | | 26.9 | % | | 26.8 | % | | 30.9 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Capital Ratios:(2) | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | Standardized Approach | | | | | | | | | | | | | | | | | | |
| | 12.7 | % | | 12.8 | % | | 11.9 | % | | 10.8 | % | | 11.4 | % | | | | Common Equity Tier 1 Capital | | 11.4 | % | | 10.5 | % | | 10.1 | % | | 10.8 | % | | 11.3 | % | | 11.3 | % | | 11.4 | % | | 11.4 | % | | |
| | 14.5 | % | | 13.9 | % | | 12.9 | % | | 11.8 | % | | 12.3 | % | | | | Tier 1 Capital | | 12.4 | % | | 11.5 | % | | 11.1 | % | | 11.8 | % | | 12.3 | % | | 12.3 | % | | 12.4 | % | | 12.3 | % | | |
| | 16.3 | % | | 15.6 | % | | 14.1 | % | | 13.9 | % | | 14.2 | % | | | | Total Capital | | 13.6 | % | | 12.6 | % | | 12.2 | % | | 13.9 | % | | 14.4 | % | | 14.4 | % | | 14.5 | % | | 14.2 | % | | |
| | 8.7 | % | | 7.6 | % | | 6.9 | % | | 7.1 | % | | 8.1 | % | | | | Tier 1 Leverage | | 6.5 | % | | 6.7 | % | | 7.0 | % | | 7.1 | % | | 7.3 | % | | 7.4 | % | | 7.9 | % | | 8.1 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | Advanced Approach | | | | | | | | | | | | | | | | | | |
| | 13.2 | % | | 13.4 | % | | 13.2 | % | | 11.5 | % | | 13.4 | % | | | | Common Equity Tier 1 Capital | | 12.1 | % | | 11.6 | % | | 11.4 | % | | 11.5 | % | | 11.7 | % | | 13.0 | % | | 13.2 | % | | 13.4 | % | | |
| | 15.0 | % | | 14.5 | % | | 14.3 | % | | 12.5 | % | | 14.5 | % | | | | Tier 1 Capital | | 13.2 | % | | 12.7 | % | | 12.5 | % | | 12.5 | % | | 12.7 | % | | 14.1 | % | | 14.3 | % | | 14.5 | % | | |
| | 16.8 | % | | 15.9 | % | | 15.3 | % | | 14.5 | % | | 16.5 | % | | | | Total Capital | | 14.2 | % | | 13.7 | % | | 13.5 | % | | 14.5 | % | | 14.7 | % | | 16.3 | % | | 16.5 | % | | 16.5 | % | | |
| | 8.7 | % | | 7.6 | % | | 6.9 | % | | 7.1 | % | | 8.1 | % | | | | Tier 1 Leverage | | 6.5 | % | | 6.7 | % | | 7.0 | % | | 7.1 | % | | 7.3 | % | | 7.4 | % | | 7.9 | % | | 8.1 | % | | |
| | 7.6 | % | | 8.6 | % | | 8.2 | % | | 7.9 | % | | 8.6 | % | | | | Supplementary Leverage (3) | | 7.9 | % | | 7.6 | % | | 7.7 | % | | 7.9 | % | | 8.3 | % | | 8.3 | % | | 8.4 | % | | 8.6 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Per Share Information / Ratios: | | | | | | | | | | | | | | | | | | |
| | $ | 2.60 | | | $ | 2.80 | | | $ | 2.80 | | | $ | 2.90 | | | $ | 3.00 | | | Cash Dividends Declared Per Common Share | | $ | 0.70 | | | $ | 0.70 | | | $ | 0.75 | | | $ | 0.75 | | | $ | 0.75 | | | $ | 0.75 | | | $ | 0.75 | | | $ | 0.75 | | | |
| | 39 | % | | 51 | % | | 39 | % | | 47 | % | | 59 | % | | Dividend Payout Ratio | | 40 | % | | 38 | % | | 42 | % | | 106 | % | | 50 | % | | 48 | % | | 50 | % | | 144 | % | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 106.24 | | | $ | 93.14 | | | $ | 119.61 | | | $ | 88.49 | | | $ | 84.38 | | | Market Value Per Share (End of Period) | | $ | 116.45 | | | $ | 96.48 | | | $ | 85.56 | | | $ | 88.49 | | | $ | 88.13 | | | $ | 74.14 | | | $ | 69.48 | | | $ | 84.38 | | | |
| | 16.0 | | | 17.1 | | | 16.8 | | | 14.4 | | | 16.6 | | | Stock Price Multiple of Earnings | | 16.2 | | | 13.1 | | | 11.7 | | | 14.4 | | | 15.0 | | | 13.3 | | | 13.2 | | | 16.6 | | | |
| | | | | | | | | | | | (based on trailing 4 quarters of diluted EPS) | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 46.82 | | | $ | 51.87 | | | $ | 53.58 | | | $ | 49.78 | | | $ | 53.69 | | | Book Value Per Common Share (End of Period) | | $ | 50.51 | | | $ | 48.87 | | | $ | 48.68 | | | $ | 49.78 | | | $ | 51.37 | | | $ | 51.94 | | | $ | 52.95 | | | $ | 53.69 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Fully taxable equivalent (FTE). Presentation on an FTE basis is a non-generally accepted accounting principle financial measure. Please refer to the Reconciliation to Fully Taxable Equivalent - Ratios on page 12 for further detail. | |
| (2) | Capital ratios for the current quarter are considered preliminary until the Form 10-K is filed with the Securities and Exchange Commission. | |
| (3) | From April 1, 2020, through April 1, 2021, the Federal Reserve issued temporary Supplementary Leverage Ratio (SLR) relief that required Northern Trust to exclude U.S. Treasury balances from the SLR. Please see the Northern Trust Corporation Pillar 3 disclosures for further SLR discussion. | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Northern Trust Corporation | | | | | | | | | | | | | |
INCOME STATEMENT | | | | | | | | | | | | | |
($ in Millions except per share information) | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | TWELVE MONTHS | | CHANGE (2) | | | | FOURTH QUARTER | | CHANGE (2) | | | | | | | | | | | | | | | |
| | 2023 | | 2022 | | $ | | % | | | | 2023 | | 2022 | | $ | | % | | | | | | | | | | | | | | | |
| | $ | 2,461.9 | | | $ | 2,496.3 | | | $ | (34.4) | | | (1) | % | | | Asset Servicing Trust, Investment and Other Servicing Fees | $ | 611.7 | | | $ | 588.0 | | | $ | 23.7 | | | 4 | % | | | | | | | | | | | | | | | |
| | 1,899.9 | | | 1,936.3 | | | (36.4) | | | (2) | % | | | WM Trust, Investment and Other Servicing Fees | 478.3 | | | 454.1 | | | 24.2 | | | 5 | % | | | | | | | | | | | | | | | |
| | 4,361.8 | | | 4,432.6 | | | (70.8) | | | (2) | % | | | Total Fees | 1,090.0 | | | 1,042.1 | | | 47.9 | | | 5 | % | | | | | | | | | | | | | | | |
| | 203.9 | | | 288.6 | | | (84.7) | | | (29) | % | | | Foreign Exchange Trading Income | 49.0 | | | 65.4 | | | (16.4) | | | (25) | % | | | | | | | | | | | | | | | |
| | 31.6 | | | 39.3 | | | (7.7) | | | (20) | % | | | Treasury Management Fees | 7.8 | | | 8.3 | | | (0.5) | | | (8) | % | | | | | | | | | | | | | | | |
| | 135.0 | | | 136.2 | | | (1.2) | | | (1) | % | | | Security Commissions and Trading Income | 33.3 | | | 35.1 | | | (1.8) | | | (5) | % | | | | | | | | | | | | | | | |
| | 228.7 | | | 191.3 | | | 37.4 | | | 19 | % | | | Other Operating Income | 58.5 | | | 47.3 | | | 11.2 | | | 24 | % | | | | | | | | | | | | | | | |
| | (169.5) | | | (214.0) | | | 44.5 | | | N/M | | | Investment Security Gains (Losses), net | (176.4) | | | (213.7) | | | 37.3 | | | N/M | | | | | | | | | | | | | | | |
| | 4,791.5 | | | 4,874.0 | | | (82.5) | | | (2) | % | | | Total Noninterest Income | 1,062.2 | | | 984.5 | | | 77.7 | | | 8 | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 7,382.5 | | | 2,923.3 | | | 4,459.2 | | | 153 | % | | | Interest Income (FTE)(1) | 2,217.6 | | | 1,185.6 | | | 1,032.0 | | | 87 | % | | | | | | | | | | | | | | | |
| | 5,343.0 | | | 990.5 | | | 4,352.5 | | | N/M | | | Interest Expense | 1,716.5 | | | 635.6 | | | 1,080.9 | | | 170 | % | | | | | | | | | | | | | | | |
| | 2,039.5 | | | 1,932.8 | | | 106.7 | | | 6 | % | | | Net Interest Income (FTE)(1) | 501.1 | | | 550.0 | | | (48.9) | | | (9) | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 6,831.0 | | | 6,806.8 | | | 24.2 | | | — | % | | | Total Revenue (FTE)(1) | 1,563.3 | | | 1,534.5 | | | 28.8 | | | 2 | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 24.5 | | | 12.0 | | | 12.5 | | | N/M | | | Provision for Credit Losses | 11.0 | | | 5.0 | | | 6.0 | | | N/M | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2,321.8 | | | 2,248.0 | | | 73.8 | | | 3 | % | | | Compensation | 564.0 | | | 584.3 | | | (20.3) | | | (3) | % | | | | | | | | | | | | | | | |
| | 405.2 | | | 437.4 | | | (32.2) | | | (7) | % | | | Employee Benefits | 102.0 | | | 103.6 | | | (1.6) | | | (2) | % | | | | | | | | | | | | | | | |
| | 906.5 | | | 880.3 | | | 26.2 | | | 3 | % | | | Outside Services | 235.2 | | | 232.9 | | | 2.3 | | | 1 | % | | | | | | | | | | | | | | | |
| | 945.5 | | | 838.8 | | | 106.7 | | | 13 | % | | | Equipment and Software | 252.0 | | | 229.4 | | | 22.6 | | | 10 | % | | | | | | | | | | | | | | | |
| | 232.3 | | | 219.1 | | | 13.2 | | | 6 | % | | | Occupancy | 58.5 | | | 65.7 | | | (7.2) | | | (11) | % | | | | | | | | | | | | | | | |
| | 472.9 | | | 359.3 | | | 113.6 | | | 32 | % | | | Other Operating Expense | 176.8 | | | 107.7 | | | 69.1 | | | 64 | % | | | | | | | | | | | | | | | |
| | 5,284.2 | | | 4,982.9 | | | 301.3 | | | 6 | % | | | Total Noninterest Expense | 1,388.5 | | | 1,323.6 | | | 64.9 | | | 5 | % | | | | | | | | | | | | | | | |
| | 1,522.3 | | | 1,811.9 | | | (289.6) | | | (16) | % | | | Income before Income Taxes (FTE)(1) | 163.8 | | | 205.9 | | | (42.1) | | | (20) | % | | | | | | | | | | | | | | | |
| | 357.5 | | | 430.3 | | | (72.8) | | | (17) | % | | | Provision for Income Taxes | 32.7 | | | 34.7 | | | (2.0) | | | (6) | % | | | | | | | | | | | | | | | |
| | 57.5 | | | 45.6 | | | 11.9 | | | 26 | % | | | Taxable Equivalent Adjustment | 18.0 | | | 15.5 | | | 2.5 | | | 16 | % | | | | | | | | | | | | | | | |
| | 415.0 | | | 475.9 | | | (60.9) | | | (13) | % | | | Total Taxes (FTE)(1) | 50.7 | | | 50.2 | | | 0.5 | | | 1 | % | | | | | | | | | | | | | | | |
| | $ | 1,107.3 | | | $ | 1,336.0 | | | $ | (228.7) | | | (17) | % | | | Net Income | $ | 113.1 | | | $ | 155.7 | | | $ | (42.6) | | | (27) | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 41.8 | | | $ | 41.8 | | | $ | — | | | — | % | | | Dividends on Preferred Stock | $ | 4.7 | | | $ | 4.7 | | | $ | — | | | — | % | | | | | | | | | | | | | | | |
| | 11.6 | | | 11.8 | | | (0.2) | | | (1) | % | | | Earnings Allocated to Participating Securities | 1.9 | | | 2.3 | | | (0.4) | | | (16) | % | | | | | | | | | | | | | | | |
| | 1,053.9 | | | 1,282.4 | | | (228.5) | | | (18) | % | | | Earnings Allocated to Common and Potential Common Shares | 106.5 | | | 148.7 | | | (42.2) | | | (28) | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 5.09 | | | $ | 6.16 | | | $ | (1.07) | | | (17) | % | | | Earnings Per Share - Basic | $ | 0.52 | | | $ | 0.71 | | | $ | (0.19) | | | (28) | % | | | | | | | | | | | | | | | |
| | $ | 5.08 | | | $ | 6.14 | | | $ | (1.06) | | | (17) | % | | | Earnings Per Share - Diluted | $ | 0.52 | | | $ | 0.71 | | | $ | (0.19) | | | (27) | % | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 207,248 | | | 208,309 | | | | | | | | Average Basic Shares (000s) | 206,170 | | | 208,423 | | | | | | | | | | | | | | | | | | | | |
| | 207,564 | | | 208,867 | | | | | | | | Average Diluted Shares (000s) | 206,484 | | | 208,894 | | | | | | | | | | | | | | | | | | | | |
| | 205,126 | | | 208,428 | | | | | | | | End of Period Shares Outstanding (000s) | 205,126 | | | 208,428 | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | N/M - Not meaningful | | | | | | | | | | | | | | | |
| | (1) Fully taxable equivalent (FTE). Presentation on an FTE basis is a non-generally accepted accounting principle financial measure. Please refer to the Reconciliation to Fully Taxable Equivalent on page 11 for further detail. | | | | | | | | | | | | | |
| | (2) Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information. | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Northern Trust Corporation |
NET INCOME TRENDS |
($ in Millions except per share information) |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | 2022 | | 2023 | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | | | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | |
| | $ | 2,211.5 | | | $ | 2,321.6 | | | $ | 2,487.3 | | | $ | 2,496.3 | | | $ | 2,461.9 | | | Asset Servicing Trust, Investment and Other Servicing Fees | | $ | 662.4 | | | $ | 642.7 | | | $ | 603.2 | | | $ | 588.0 | | | $ | 603.0 | | | $ | 621.2 | | | $ | 626.0 | | | $ | 611.7 | | | |
| | 1,640.6 | | | 1,673.4 | | | 1,873.8 | | | 1,936.3 | | | 1,899.9 | | | WM Trust, Investment and Other Servicing Fees | | 506.0 | | | 500.7 | | | 475.5 | | | 454.1 | | | 460.6 | | | 475.1 | | | 485.9 | | | 478.3 | | | |
| | 3,852.1 | | | 3,995.0 | | | 4,361.1 | | | 4,432.6 | | | 4,361.8 | | | | Total Fees | | 1,168.4 | | | 1,143.4 | | | 1,078.7 | | | 1,042.1 | | | 1,063.6 | | | 1,096.3 | | | 1,111.9 | | | 1,090.0 | | | |
| | 250.9 | | | 290.4 | | | 292.6 | | | 288.6 | | | 203.9 | | | Foreign Exchange Trading Income | | 80.9 | | | 77.6 | | | 64.7 | | | 65.4 | | | 53.0 | | | 50.1 | | | 51.8 | | | 49.0 | | | |
| | 44.5 | | | 45.4 | | | 44.3 | | | 39.3 | | | 31.6 | | | Treasury Management Fees | | 11.1 | | | 10.6 | | | 9.3 | | | 8.3 | | | 8.4 | | | 7.9 | | | 7.5 | | | 7.8 | | | |
| | 103.6 | | | 133.2 | | | 140.2 | | | 136.2 | | | 135.0 | | | Security Commissions and Trading Income | | 36.2 | | | 32.8 | | | 32.1 | | | 35.1 | | | 34.7 | | | 36.1 | | | 30.9 | | | 33.3 | | | |
| | 145.5 | | | 194.0 | | | 243.9 | | | 191.3 | | | 228.7 | | | Other Operating Income | | 41.1 | | | 45.6 | | | 57.3 | | | 47.3 | | | 46.8 | | | 55.2 | | | 68.2 | | | 58.5 | | | |
| | (1.4) | | | (0.4) | | | (0.3) | | | (214.0) | | | (169.5) | | | Investment Security Gains (Losses), net | | — | | | — | | | (0.3) | | | (213.7) | | | 6.9 | | | — | | | — | | | (176.4) | | | |
| | 4,395.2 | | | 4,657.6 | | | 5,081.8 | | | 4,874.0 | | | 4,791.5 | | | | Total Noninterest Income | | 1,337.7 | | | 1,310.0 | | | 1,241.8 | | | 984.5 | | | 1,213.4 | | | 1,245.6 | | | 1,270.3 | | | 1,062.2 | | | |
| | 1,710.7 | | | 1,477.6 | | | 1,418.3 | | | 1,932.8 | | | 2,039.5 | | | Net Interest Income (FTE)(1) | | 387.7 | | | 469.8 | | | 525.3 | | | 550.0 | | | 544.4 | | | 524.6 | | | 469.4 | | | 501.1 | | | |
| | 6,105.9 | | | 6,135.2 | | | 6,500.1 | | | 6,806.8 | | | 6,831.0 | | | | Total Revenue (FTE)(1) | | 1,725.4 | | | 1,779.8 | | | 1,767.1 | | | 1,534.5 | | | 1,757.8 | | | 1,770.2 | | | 1,739.7 | | | 1,563.3 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (14.5) | | | 125.0 | | | (81.5) | | | 12.0 | | | 24.5 | | | Provision for (Release of) Credit Losses | | 2.0 | | | 4.5 | | | 0.5 | | | 5.0 | | | 15.0 | | | (15.5) | | | 14.0 | | | 11.0 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1,859.0 | | | 1,947.1 | | | 2,011.0 | | | 2,248.0 | | | 2,321.8 | | | Compensation | | 563.9 | | | 546.5 | | | 553.3 | | | 584.3 | | | 595.2 | | | 604.5 | | | 558.1 | | | 564.0 | | | |
| | 355.2 | | | 387.7 | | | 431.4 | | | 437.4 | | | 405.2 | | | Employee Benefits | | 104.3 | | | 119.6 | | | 109.9 | | | 103.6 | | | 101.0 | | | 101.4 | | | 100.8 | | | 102.0 | | | |
| | 774.5 | | | 763.1 | | | 849.4 | | | 880.3 | | | 906.5 | | | Outside Services | | 213.4 | | | 213.1 | | | 220.9 | | | 232.9 | | | 210.8 | | | 230.9 | | | 229.6 | | | 235.2 | | | |
| | 612.1 | | | 673.5 | | | 736.3 | | | 838.8 | | | 945.5 | | | Equipment and Software | | 193.5 | | | 203.5 | | | 212.4 | | | 229.4 | | | 231.7 | | | 229.3 | | | 232.5 | | | 252.0 | | | |
| | 212.9 | | | 230.1 | | | 208.7 | | | 219.1 | | | 232.3 | | | Occupancy | | 51.1 | | | 51.0 | | | 51.3 | | | 65.7 | | | 61.3 | | | 53.8 | | | 58.7 | | | 58.5 | | | |
| | 329.8 | | | 346.7 | | | 299.1 | | | 359.3 | | | 472.9 | | | Other Operating Expense | | 79.7 | | | 89.9 | | | 82.0 | | | 107.7 | | | 85.6 | | | 112.0 | | | 98.5 | | | 176.8 | | | |
| | 4,143.5 | | | 4,348.2 | | | 4,535.9 | | | 4,982.9 | | | 5,284.2 | | | | Total Noninterest Expense | | 1,205.9 | | | 1,223.6 | | | 1,229.8 | | | 1,323.6 | | | 1,285.6 | | | 1,331.9 | | | 1,278.2 | | | 1,388.5 | | | |
| | 1,976.9 | | | 1,662.0 | | | 2,045.7 | | | 1,811.9 | | | 1,522.3 | | | | Income before Income Taxes (FTE)(1) | | 517.5 | | | 551.7 | | | 536.8 | | | 205.9 | | | 457.2 | | | 453.8 | | | 447.5 | | | 163.8 | | | |
| | 451.9 | | | 418.3 | | | 464.8 | | | 430.3 | | | 357.5 | | | Provision for Income Taxes | | 121.5 | | | 144.4 | | | 129.7 | | | 34.7 | | | 109.4 | | | 108.9 | | | 106.5 | | | 32.7 | | | |
| | 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | Taxable Equivalent Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | | 13.2 | | | 18.0 | | | |
| | 484.7 | | | 452.7 | | | 500.4 | | | 475.9 | | | 415.0 | | | | Total Taxes (FTE)(1) | | 128.2 | | | 155.5 | | | 142.0 | | | 50.2 | | | 122.6 | | | 122.0 | | | 119.7 | | | 50.7 | | | |
| | $ | 1,492.2 | | | $ | 1,209.3 | | | $ | 1,545.3 | | | $ | 1,336.0 | | | $ | 1,107.3 | | | | Net Income | | $ | 389.3 | | | $ | 396.2 | | | $ | 394.8 | | | $ | 155.7 | | | $ | 334.6 | | | $ | 331.8 | | | $ | 327.8 | | | $ | 113.1 | | | |
| | $ | 6.66 | | | $ | 5.48 | | | $ | 7.16 | | | $ | 6.16 | | | $ | 5.09 | | | Earnings Per Share - Basic | | $ | 1.78 | | | $ | 1.86 | | | $ | 1.80 | | | $ | 0.71 | | | $ | 1.51 | | | $ | 1.56 | | | $ | 1.49 | | | $ | 0.52 | | | |
| | 6.63 | | | 5.46 | | | 7.14 | | | 6.14 | | | 5.08 | | | Earnings Per Share - Diluted | | 1.77 | | | 1.86 | | | 1.80 | | | 0.71 | | | 1.51 | | | 1.56 | | | 1.49 | | | 0.52 | | | |
| | 215,601 | | | 209,008 | | | 208,899 | | | 208,867 | | | 207,564 | | | Average Diluted Shares (000s) | | 208,809 | | | 208,878 | | | 208,889 | | | 208,894 | | | 208,730 | | | 207,816 | | | 207,253 | | | 206,484 | | | |
| | $ | 46.4 | | | $ | 56.2 | | | $ | 41.8 | | | $ | 41.8 | | | $ | 41.8 | | | Preferred Dividends(2) | | $ | 16.2 | | | $ | 4.7 | | | $ | 16.2 | | | $ | 4.7 | | | $ | 16.2 | | | $ | 4.7 | | | $ | 16.2 | | | $ | 4.7 | | | |
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| | (1) Fully taxable equivalent (FTE). Presentation on an FTE basis is a non-generally accepted accounting principle financial measure. Please refer to the Reconciliation to Fully Taxable Equivalent on page 11 for further detail. | | |
| | (2) Dividends on Preferred Stock in 2020 includes $11.5 million related to the difference between the redemption amount of the Corporation's Series C Non-Cumulative Perpetual Preferred Stock, which was redeemed in the first quarter of 2020, and its carrying value. | | |
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Northern Trust Corporation | | | |
TRUST, INVESTMENT AND OTHER SERVICING FEES DETAIL | | | |
($ in Millions) | | | |
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| | | | | | | | | | | | | | 2022 | | 2023 | | | | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | Asset Servicing | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | | | | |
| | $ | 1,549.3 | | | $ | 1,586.1 | | | $ | 1,818.8 | | | $ | 1,700.1 | | | $ | 1,689.5 | | | Custody & Fund Administration | $ | 452.7 | | | $ | 433.8 | | | $ | 407.3 | | | $ | 406.3 | | | $ | 413.6 | | | $ | 427.4 | | | $ | 428.1 | | | $ | 420.4 | | | | | | |
| | 445.7 | | | 511.1 | | | 443.5 | | | 555.1 | | | 528.1 | | | Investment Management | 146.9 | | | 148.4 | | | 136.0 | | | 123.8 | | | 126.2 | | | 134.1 | | | 137.1 | | | 130.4 | | | | | | |
| | 87.2 | | | 88.0 | | | 76.7 | | | 81.4 | | | 83.0 | | | Securities Lending | 18.8 | | | 21.6 | | | 21.7 | | | 19.3 | | | 19.1 | | | 21.5 | | | 20.4 | | | 22.0 | | | | | | |
| | 129.3 | | | 136.4 | | | 148.3 | | | 159.7 | | | 161.3 | | | Other | 44.0 | | | 38.9 | | | 38.2 | | | 38.6 | | | 44.1 | | | 38.2 | | | 40.4 | | | 38.9 | | | | | | |
| | $ | 2,211.5 | | | $ | 2,321.6 | | | $ | 2,487.3 | | | $ | 2,496.3 | | | $ | 2,461.9 | | | | Total Asset Servicing Trust, Investment and Other Servicing Fees | $ | 662.4 | | | $ | 642.7 | | | $ | 603.2 | | | $ | 588.0 | | | $ | 603.0 | | | $ | 621.2 | | | $ | 626.0 | | | $ | 611.7 | | | | | | |
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| | | | | | | | | | | | Wealth Management | | | | | | | | | | | | | | | | | | | | |
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| | $ | 619.3 | | | $ | 607.3 | | | $ | 698.7 | | | $ | 692.6 | | | $ | 673.8 | | | Central | $ | 181.7 | | | $ | 177.4 | | | $ | 171.3 | | | $ | 162.2 | | | $ | 163.6 | | | $ | 166.0 | | | $ | 172.3 | | | $ | 171.9 | | | | | | |
| | 422.2 | | | 442.1 | | | 509.3 | | | 504.0 | | | 491.5 | | | East | 134.0 | | | 128.1 | | | 124.1 | | | 117.8 | | | 119.8 | | | 124.1 | | | 126.1 | | | 121.5 | | | | | | |
| | 330.9 | | | 337.7 | | | 380.2 | | | 382.1 | | | 378.0 | | | West | 101.4 | | | 98.7 | | | 92.5 | | | 89.5 | | | 91.2 | | | 93.7 | | | 95.8 | | | 97.3 | | | | | | |
| | 268.2 | | | 286.3 | | | 285.6 | | | 357.6 | | | 356.6 | | | Global Family Office | 88.9 | | | 96.5 | | | 87.6 | | | 84.6 | | | 86.0 | | | 91.3 | | | 91.7 | | | 87.6 | | | | | | |
| | $ | 1,640.6 | | | $ | 1,673.4 | | | $ | 1,873.8 | | | $ | 1,936.3 | | | $ | 1,899.9 | | | | Total WM Trust, Investment and Other Servicing Fees | $ | 506.0 | | | $ | 500.7 | | | $ | 475.5 | | | $ | 454.1 | | | $ | 460.6 | | | $ | 475.1 | | | $ | 485.9 | | | $ | 478.3 | | | | | | |
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Northern Trust Corporation | | | | | | |
BALANCE SHEET | | | | | | |
END OF PERIOD | | | | | | |
($ in Millions) | | | | | | |
| | | | | | | | | | | CHANGE (5) | | | | | | | | |
| | Assets | | 12/31/2023 | | 12/31/2022 | | $ | | % | | | | | | | | |
| | | Federal Reserve and Other Central Bank Deposits | | $ | 34,281.0 | | | $ | 39,961.9 | | | $ | (5,680.9) | | | (14) | % | | | | | | | | |
| | | Interest-Bearing Due from and Deposits with Banks(1) | | 5,241.4 | | | 4,926.6 | | | 314.8 | | | 6 | % | | | | | | | | |
| | | Federal Funds Sold | — | | | 32.0 | | | (32.0) | | | (100) | % | | | | | | | | |
| | | Securities Purchased under Agreements to Resell | 784.7 | | | 1,070.3 | | | (285.6) | | | (27) | % | | | | | | | | |
| | | Debt Securities: | | | | | | | | | | | | | | | | |
| | | | Available For Sale | | 23,089.8 | | | 26,699.9 | | | (3,610.1) | | | (14) | % | | | | | | | | |
| | | | Held To Maturity | | 26,221.7 | | | 25,036.1 | | | 1,185.6 | | | 5 | % | | | | | | | | |
| | | | Trading Account | | — | | | 95.2 | | | (95.2) | | | (100) | % | | | | | | | | |
| | | | Total Debt Securities | | 49,311.5 | | | 51,831.2 | | | (2,519.7) | | | (5) | % | | | | | | | | |
| | | Loans | | 47,617.0 | | | 42,893.3 | | | 4,723.7 | | | 11 | % | | | | | | | | |
| | | Other Interest-Earning Assets(2) | | 3,134.0 | | | 1,769.4 | | | 1,364.6 | | | 77 | % | | | | | | | | |
| | | | Total Earning Assets | | 140,369.6 | | | 142,484.7 | | | (2,115.1) | | | (1) | % | | | | | | | | |
| | | Allowance for Credit Losses | | (192.3) | | | (161.1) | | | (31.2) | | | 19 | % | | | | | | | | |
| | | Cash and Due From Banks and Other Central Bank Deposits(3) | | 1,534.3 | | | 1,737.2 | | | (202.9) | | | (12) | % | | | | | | | | |
| | | Buildings and Equipment | | 502.2 | | | 500.5 | | | 1.7 | | | — | % | | | | | | | | |
| | | Client Security Settlement Receivables | | 212.6 | | | 1,698.3 | | | (1,485.7) | | | (87) | % | | | | | | | | |
| | | Goodwill | | 702.3 | | | 691.3 | | | 11.0 | | | 2 | % | | | | | | | | |
| | | Other Assets | | 7,654.4 | | | 8,085.8 | | | (431.4) | | | (5) | % | | | | | | | | |
| | | | Total Assets | | $ | 150,783.1 | | | $ | 155,036.7 | | | $ | (4,253.6) | | | (3) | % | | | | | | | | |
| | Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | |
| | | Savings, Money Market and Other | | $ | 25,252.1 | | | $ | 31,128.6 | | | $ | (5,876.5) | | | (19) | % | | | | | | | | |
| | | Savings Certificates and Other Time | | 4,109.7 | | | 1,981.3 | | | 2,128.4 | | | 107 | % | | | | | | | | |
| | | Non- U.S. Offices - Interest-Bearing | | 63,971.1 | | | 65,481.9 | | | (1,510.8) | | | (2) | % | | | | | | | | |
| | | | Total Interest-Bearing Deposits | | 93,332.9 | | | 98,591.8 | | | (5,258.9) | | | (5) | % | | | | | | | | |
| | | Federal Funds Purchased | | 3,045.4 | | | 1,896.9 | | | 1,148.5 | | | 61 | % | | | | | | | | |
| | | Securities Sold under Agreements to Repurchase | | 784.7 | | | 567.2 | | | 217.5 | | | 38 | % | | | | | | | | |
| | | Other Borrowings(4) | | 6,567.8 | | | 7,592.3 | | | (1,024.5) | | | (13) | % | | | | | | | | |
| | | Senior Notes | | 2,773.2 | | | 2,724.2 | | | 49.0 | | | 2 | % | | | | | | | | |
| | | Long-Term Debt | | 4,065.0 | | | 2,066.2 | | | 1,998.8 | | | 97 | % | | | | | | | | |
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| | | | Total Interest-Related Funds | | 110,569.0 | | | 113,438.6 | | | (2,869.6) | | | (3) | % | | | | | | | | |
| | | Demand and Other Noninterest-Bearing Deposits | | 22,831.1 | | | 25,340.3 | | | (2,509.2) | | | (10) | % | | | | | | | | |
| | | Other Liabilities | | 5,485.1 | | | 4,998.3 | | | 486.8 | | | 10 | % | | | | | | | | |
| | | | Total Liabilities | | 138,885.2 | | | 143,777.2 | | | (4,892.0) | | | (3) | % | | | | | | | | |
| | | Common Equity | | 11,013.0 | | | 10,374.6 | | | 638.4 | | | 6 | % | | | | | | | | |
| | | Preferred Equity | | 884.9 | | | 884.9 | | | — | | | — | % | | | | | | | | |
| | | | Total Stockholders' Equity | | 11,897.9 | | | 11,259.5 | | | 638.4 | | | 6 | % | | | | | | | | |
| | | | Total Liabilities and Stockholders' Equity | | $ | 150,783.1 | | | $ | 155,036.7 | | | $ | (4,253.6) | | | (3) | % | | | | | | | | |
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| | (1) | Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
| | (2) | Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
| | (3) | Cash and Due from Banks and Other Central Bank Deposits includes the noninterest-bearing component of Federal Reserve and Other Central Bank Deposits as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
| | (4) | Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago. | | | | | | | |
| | (5) | Percentage calculations are based on actual balances rather than the rounded amounts presented in the Supplemental Consolidated Financial Information. | | | | | | | |
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Northern Trust Corporation | | | | | |
BALANCE SHEET TRENDS | | | | | |
PERIOD AVERAGES(1) | | | | | |
($ in Millions) | | | | | |
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| | | | | | | | | | | | | | | | 2022 | | 2023 | | | | | | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | Assets | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | | | | | | |
| | $ | 18,511 | | | $ | 27,904 | | | $ | 39,028 | | | $ | 36,249 | | | $ | 31,205 | | | | Federal Reserve and Other Central Bank Deposits | $ | 45,200 | | | $ | 36,691 | | | $ | 30,549 | | | $ | 32,755 | | | $ | 36,642 | | | $ | 34,380 | | | $ | 28,001 | | | $ | 25,951 | | | | | | | | |
| | 5,997 | | | 5,401 | | | 5,780 | | | 4,193 | | | 4,334 | | | | Interest-Bearing Due from and Deposits with Banks(2) | 4,384 | | | 4,228 | | | 3,977 | | | 4,186 | | | 4,199 | | | 4,573 | | | 4,301 | | | 4,262 | | | | | | | | |
| | 13 | | | 2 | | | — | | | 6 | | | 6 | | | | Federal Funds Sold | 1 | | | 2 | | | 5 | | | 14 | | | 20 | | | 3 | | | 1 | | | 1 | | | | | | | | |
| | 835 | | | 1,253 | | | 1,067 | | | 1,071 | | | 951 | | | | Securities Purchased under Agreements to Resell | 692 | | | 1,149 | | | 1,271 | | | 1,166 | | | 1,046 | | | 1,239 | | | 951 | | | 573 | | | | | | | | |
| | | | | | | | | | | | | Debt Securities: | | | | | | | | | | | | | | | | | | | | | | |
| | 38,016 | | | 40,643 | | | 38,987 | | | 32,060 | | | 24,357 | | | | | Available For Sale | 37,496 | | | 35,677 | | | 28,483 | | | 26,742 | | | 25,030 | | | 24,512 | | | 24,431 | | | 23,470 | | | | | | | | |
| | 11,650 | | | 14,353 | | | 20,617 | | | 22,970 | | | 25,512 | | | | | Held To Maturity | 21,308 | | | 20,244 | | | 25,127 | | | 25,135 | | | 25,382 | | | 25,053 | | | 25,919 | | | 25,685 | | | | | | | | |
| | 1 | | | 1 | | | 1 | | | 12 | | | 1 | | | | | Trading Account | 1 | | | — | | | — | | | 46 | | | 1 | | | — | | | — | | | — | | | | | | | | |
| | 49,667 | | | 54,997 | | | 59,605 | | | 55,042 | | | 49,869 | | | | | Total Debt Securities | | 58,805 | | | 55,921 | | | 53,610 | | | 51,924 | | | 50,414 | | | 49,565 | | | 50,350 | | | 49,155 | | | | | | | | |
| | 31,053 | | | 33,499 | | | 37,208 | | | 41,031 | | | 42,177 | | | | Loans and Leases | 39,544 | | | 40,747 | | | 41,466 | | | 42,329 | | | 41,959 | | | 42,365 | | | 42,210 | | | 42,170 | | | | | | | | |
| | 1,034 | | | 1,077 | | | 1,186 | | | 1,248 | | | 2,259 | | | | Other Interest-Earning Assets(3) | 1,143 | | | 1,163 | | | 1,269 | | | 1,414 | | | 1,678 | | | 1,990 | | | 2,440 | | | 2,913 | | | | | | | | |
| | 107,109 | | | 124,133 | | | 143,873 | | | 138,839 | | | 130,801 | | | | | Total Earning Assets | | 149,768 | | | 139,902 | | | 132,147 | | | 133,789 | | | 135,957 | | | 134,116 | | | 128,254 | | | 125,025 | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (111) | | | (178) | | | (173) | | | (154) | | | (173) | | | | Allowance for Credit Losses | (152) | | | (156) | | | (154) | | | (155) | | | (162) | | | (177) | | | (170) | | | (183) | | | | | | | | |
| | 2,394 | | | 2,603 | | | 2,286 | | | 2,070 | | | 1,772 | | | | Cash and Due From Banks and Other Central Bank Deposits(4) | 2,047 | | | 2,559 | | | 1,903 | | | 1,774 | | | 1,796 | | | 1,843 | | | 1,695 | | | 1,755 | | | | | | | | |
| | 426 | | | 509 | | | 503 | | | 489 | | | 485 | | | | Buildings and Equipment | 495 | | | 488 | | | 481 | | | 491 | | | 497 | | | 482 | | | 474 | | | 486 | | | | | | | | |
| | 1,070 | | | 1,358 | | | 1,530 | | | 1,722 | | | 559 | | | | Client Security Settlement Receivables | 1,826 | | | 1,588 | | | 1,667 | | | 1,810 | | | 1,099 | | | 593 | | | 350 | | | 206 | | | | | | | | |
| | 683 | | | 695 | | | 707 | | | 692 | | | 696 | | | | Goodwill | 704 | | | 694 | | | 686 | | | 686 | | | 692 | | | 697 | | | 699 | | | 696 | | | | | | | | |
| | 5,981 | | | 7,691 | | | 7,637 | | | 8,894 | | | 8,509 | | | | Other Assets | 7,455 | | | 9,010 | | | 9,673 | | | 9,409 | | | 8,180 | | | 8,346 | | | 8,900 | | | 8,603 | | | | | | | | |
| | $ | 117,551 | | | $ | 136,811 | | | $ | 156,363 | | | $ | 152,552 | | | $ | 142,649 | | | | | Total Assets | | $ | 162,143 | | | $ | 154,084 | | | $ | 146,402 | | | $ | 147,804 | | | $ | 148,060 | | | $ | 145,900 | | | $ | 140,202 | | | $ | 136,589 | | | | | | | | |
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| | | | | | | | | | | | Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 16,578 | | | $ | 23,396 | | | $ | 28,339 | | | $ | 30,205 | | | $ | 24,172 | | | | Savings, Money Market and Other | $ | 32,329 | | | $ | 30,968 | | | $ | 29,089 | | | $ | 28,489 | | | $ | 27,269 | | | $ | 22,961 | | | $ | 22,625 | | | $ | 23,889 | | | | | | | | |
| | 868 | | | 1,266 | | | 887 | | | 1,060 | | | 3,341 | | | | Savings Certificates and Other Time | 842 | | | 792 | | | 986 | | | 1,611 | | | 2,360 | | | 3,036 | | | 3,665 | | | 4,279 | | | | | | | | |
| | 54,885 | | | 60,486 | | | 69,713 | | | 65,031 | | | 60,009 | | | | Non- U.S. Offices - Interest-Bearing | 68,200 | | | 63,901 | | | 64,057 | | | 64,024 | | | 62,411 | | | 62,046 | | | 58,681 | | | 56,971 | | | | | | | | |
| | 72,331 | | | 85,149 | | | 98,940 | | | 96,296 | | | 87,522 | | | | | Total Interest-Bearing Deposits | | 101,371 | | | 95,661 | | | 94,133 | | | 94,123 | | | 92,040 | | | 88,044 | | | 84,971 | | | 85,139 | | | | | | | | |
| | 1,267 | | | 981 | | | 191 | | | 1,408 | | | 5,144 | | | | Federal Funds Purchased | — | | | 923 | | | 1,968 | | | 2,705 | | | 3,654 | | | 7,070 | | | 5,936 | | | 3,906 | | | | | | | | |
| | 339 | | | 218 | | | 232 | | | 434 | | | 402 | | | | Securities Sold under Agreements to Repurchase | 254 | | | 597 | | | 490 | | | 392 | | | 347 | | | 468 | | | 426 | | | 365 | | | | | | | | |
| | 7,753 | | | 6,401 | | | 5,050 | | | 5,464 | | | 10,340 | | | | Other Borrowings(5) | 3,691 | | | 4,187 | | | 5,991 | | | 7,933 | | | 11,324 | | | 12,133 | | | 10,982 | | | 6,961 | | | | | | | | |
| | 2,389 | | | 3,234 | | | 2,856 | | | 2,756 | | | 2,734 | | | | Senior Notes | 2,442 | | | 2,885 | | | 2,970 | | | 2,722 | | | 2,748 | | | 2,761 | | | 2,713 | | | 2,714 | | | | | | | | |
| | 1,139 | | | 1,189 | | | 1,166 | | | 1,259 | | | 2,586 | | | | Long-Term Debt | 1,128 | | | 1,096 | | | 1,088 | | | 1,719 | | | 2,066 | | | 2,070 | | | 2,127 | | | 4,064 | | | | | | | | |
| | 278 | | | 278 | | | 218 | | | — | | | — | | | | Floating Rate Capital Debt | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | | | | |
| | 85,495 | | | 97,450 | | | 108,653 | | | 107,616 | | | 108,728 | | | | | Total Interest-Related Funds | | 108,886 | | | 105,348 | | | 106,638 | | | 109,594 | | | 112,179 | | | 112,545 | | | 107,154 | | | 103,148 | | | | | | | | |
| | 17,456 | | | 23,362 | | | 31,144 | | | 29,296 | | | 17,723 | | | | Demand and Other Noninterest-Bearing Deposits | 37,129 | | | 33,733 | | | 24,356 | | | 22,186 | | | 20,146 | | | 17,555 | | | 16,793 | | | 16,450 | | | | | | | | |
| | 3,952 | | | 4,806 | | | 4,870 | | | 4,558 | | | 4,702 | | | | Other Liabilities | 4,616 | | | 4,096 | | | 4,473 | | | 5,044 | | | 4,453 | | | 4,351 | | | 4,718 | | | 5,275 | | | | | | | | |
| | 106,903 | | | 125,618 | | | 144,666 | | | 141,471 | | | 131,152 | | | | | Total Liabilities | | 150,632 | | | 143,177 | | | 135,467 | | | 136,824 | | | 136,778 | | | 134,451 | | | 128,665 | | | 124,873 | | | | | | | | |
| | 9,705 | | | 10,307 | | | 10,812 | | | 10,197 | | | 10,612 | | | | Common Equity | 10,626 | | | 10,022 | | | 10,051 | | | 10,095 | | | 10,397 | | | 10,564 | | | 10,652 | | | 10,831 | | | | | | | | |
| | 943 | | | 886 | | | 885 | | | 885 | | | 885 | | | | Preferred Equity | 885 | | | 885 | | | 885 | | | 885 | | | 885 | | | 885 | | | 885 | | | 885 | | | | | | | | |
| | 10,648 | | | 11,193 | | | 11,697 | | | 11,081 | | | 11,497 | | | | | Total Stockholders' Equity | | 11,511 | | | 10,907 | | | 10,936 | | | 10,979 | | | 11,282 | | | 11,449 | | | 11,537 | | | 11,716 | | | | | | | | |
| | $ | 117,551 | | | $ | 136,811 | | | $ | 156,363 | | | $ | 152,552 | | | $ | 142,649 | | | | | Total Liabilities and Stockholders' Equity | | $ | 162,143 | | | $ | 154,084 | | | $ | 146,402 | | | $ | 147,804 | | | $ | 148,060 | | | $ | 145,900 | | | $ | 140,202 | | | $ | 136,589 | | | | | | | | |
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(1) | Summations may not equal due to rounding. | | | | | | | |
(2) | Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
(3) | Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
(4) | Cash and Due from Banks and Other Central Bank Deposits includes the noninterest-bearing component of Federal Reserve and Other Central Bank Deposits as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | | | | |
(5) | Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago. | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Northern Trust Corporation | | |
BALANCE SHEET MIX TRENDS | | |
PERIOD AVERAGES(1) | | |
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| | | | | | | | | | | | | | | | 2022 | | 2023 | | | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | Assets | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | | | |
| | 15.7 | % | | 20.4 | % | | 25.0 | % | | 23.8 | % | | 21.9 | % | | Federal Reserve and Other Central Bank Deposits | 27.9 | % | | 23.8 | % | | 20.9 | % | | 22.2 | % | | 24.7 | % | | 23.6 | % | | 20.0 | % | | 19.0 | % | | | | |
| | 5.1 | | | 3.9 | | | 3.7 | | | 2.7 | | | 3.0 | | | Interest-Bearing Due from and Deposits with Banks(2) | 2.7 | | | 2.7 | | | 2.7 | | | 2.8 | | | 2.8 | | | 3.1 | | | 3.1 | | | 3.1 | | | | | |
| | — | | | — | | | — | | | — | | | — | | | Federal Funds Sold | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | |
| | 0.7 | | | 0.9 | | | 0.7 | | | 0.7 | | | 0.7 | | | Securities Purchased under Agreements to Resell | 0.4 | | | 0.7 | | | 0.9 | | | 0.8 | | | 0.7 | | | 0.8 | | | 0.7 | | | 0.4 | | | | | |
| | | | | | | | | | | | Debt Securities: | | | | | | | | | | | | | | | | | | | |
| | 32.3 | | | 29.7 | | | 24.9 | | | 21.0 | | | 17.1 | | | | Available For Sale | 23.1 | | | 23.2 | | | 19.5 | | | 18.1 | | | 16.9 | | | 16.8 | | | 17.4 | | | 17.2 | | | | | |
| | 9.9 | | | 10.5 | | | 13.2 | | | 15.1 | | | 17.9 | | | | Held To Maturity | 13.1 | | | 13.1 | | | 17.2 | | | 17.0 | | | 17.1 | | | 17.2 | | | 18.5 | | | 18.8 | | | | | |
| | — | | | — | | | — | | | — | | | — | | | | Trading Account | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | |
| | 42.3 | | | 40.2 | | | 38.1 | | | 36.1 | | | 35.0 | | | | Total Debt Securities | 36.3 | | | 36.3 | | | 36.6 | | | 35.1 | | | 34.0 | | | 34.0 | | | 35.9 | | | 36.0 | | | | | |
| | 26.4 | | | 24.5 | | | 23.8 | | | 26.9 | | | 29.6 | | | Loans and Leases | 24.4 | | | 26.4 | | | 28.3 | | | 28.6 | | | 28.3 | | | 29.0 | | | 30.1 | | | 30.9 | | | | | |
| | 0.9 | | | 0.8 | | | 0.8 | | | 0.8 | | | 1.6 | | | Other Interest-Earning Assets(3) | 0.7 | | | 0.8 | | | 0.9 | | | 1.0 | | | 1.1 | | | 1.4 | | | 1.7 | | | 2.1 | | | | | |
| | 91.1 | | | 90.7 | | | 92.0 | | | 91.0 | | | 91.7 | | | | Total Earning Assets | 92.4 | | | 90.8 | | | 90.3 | | | 90.5 | | | 91.8 | | | 91.9 | | | 91.5 | | | 91.5 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | Allowance for Credit Losses | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | (0.1) | | | | | |
| | 2.0 | | | 1.9 | | | 1.5 | | | 1.4 | | | 1.2 | | | Cash and Due From Banks and Other Central Bank Deposits(4) | 1.3 | | | 1.7 | | | 1.3 | | | 1.2 | | | 1.2 | | | 1.3 | | | 1.2 | | | 1.3 | | | | | |
| | 0.4 | | | 0.4 | | | 0.3 | | | 0.3 | | | 0.3 | | | Buildings and Equipment | | 0.3 | | | 0.3 | | | 0.3 | | | 0.3 | | | 0.3 | | | 0.3 | | | 0.3 | | | 0.4 | | | | | |
| | 0.9 | | | 1.0 | | | 1.0 | | | 1.1 | | | 0.4 | | | Client Security Settlement Receivables | | 1.1 | | | 1.0 | | | 1.1 | | | 1.2 | | | 0.7 | | | 0.4 | | | 0.2 | | | 0.2 | | | | | |
| | 0.6 | | | 0.5 | | | 0.5 | | | 0.5 | | | 0.5 | | | Goodwill | | 0.4 | | | 0.5 | | | 0.5 | | | 0.5 | | | 0.5 | | | 0.5 | | | 0.5 | | | 0.5 | | | | | |
| | 5.1 | | | 5.6 | | | 4.9 | | | 5.8 | | | 6.0 | | | Other Assets | | 4.6 | | | 5.8 | | | 6.6 | | | 6.4 | | | 5.5 | | | 5.7 | | | 6.3 | | | 6.3 | | | | | |
| | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | | Total Assets | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | | | | |
| | 14.1 | % | | 17.1 | % | | 18.1 | % | | 19.8 | % | | 16.9 | % | | Savings, Money Market and Other | 19.9 | % | | 20.1 | % | | 19.9 | % | | 19.3 | % | | 18.4 | % | | 15.7 | % | | 16.1 | % | | 17.5 | % | | | | |
| | 0.7 | | | 0.9 | | | 0.6 | | | 0.7 | | | 2.3 | | | Savings Certificates and Other Time | 0.5 | | | 0.5 | | | 0.7 | | | 1.1 | | | 1.6 | | | 2.1 | | | 2.6 | | | 3.1 | | | | | |
| | 46.7 | | | 44.2 | | | 44.6 | | | 42.6 | | | 42.1 | | | Non- U.S. Offices - Interest-Bearing | 42.1 | | | 41.5 | | | 43.8 | | | 43.3 | | | 42.2 | | | 42.5 | | | 41.9 | | | 41.7 | | | | | |
| | 61.5 | | | 62.2 | | | 63.3 | | | 63.1 | | | 61.4 | | | | Total Interest-Bearing Deposits | 62.5 | | | 62.1 | | | 64.3 | | | 63.7 | | | 62.2 | | | 60.3 | | | 60.6 | | | 62.3 | | | | | |
| | 1.1 | | | 0.7 | | | 0.1 | | | 0.9 | | | 3.6 | | | Federal Funds Purchased | — | | | 0.6 | | | 1.3 | | | 1.8 | | | 2.5 | | | 4.8 | | | 4.2 | | | 2.9 | | | | | |
| | 0.3 | | | 0.2 | | | 0.1 | | | 0.3 | | | 0.3 | | | Securities Sold under Agreements to Repurchase | 0.2 | | | 0.4 | | | 0.3 | | | 0.3 | | | 0.2 | | | 0.3 | | | 0.3 | | | 0.3 | | | | | |
| | 6.6 | | | 4.7 | | | 3.2 | | | 3.6 | | | 7.2 | | | Other Borrowings(5) | 2.3 | | | 2.7 | | | 4.1 | | | 5.4 | | | 7.6 | | | 8.3 | | | 7.8 | | | 5.1 | | | | | |
| | 2.0 | | | 2.4 | | | 1.8 | | | 1.8 | | | 1.9 | | | Senior Notes | 1.5 | | | 1.9 | | | 2.0 | | | 1.8 | | | 1.9 | | | 1.9 | | | 1.9 | | | 2.0 | | | | | |
| | 1.0 | | | 0.9 | | | 0.7 | | | 0.8 | | | 1.8 | | | Long-Term Debt | 0.7 | | | 0.7 | | | 0.7 | | | 1.2 | | | 1.4 | | | 1.4 | | | 1.5 | | | 3.0 | | | | | |
| | 0.2 | | | 0.2 | | | 0.1 | | | — | | | — | | | Floating Rate Capital Debt | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | | |
| | 72.7 | | | 71.2 | | | 69.5 | | | 70.5 | | | 76.2 | | | | Total Interest-Related Funds | 67.2 | | | 68.4 | | | 72.8 | | | 74.1 | | | 75.8 | | | 77.1 | | | 76.4 | | | 75.5 | | | | | |
| | 14.8 | | | 17.1 | | | 19.9 | | | 19.2 | | | 12.4 | | | Demand and Other Noninterest-Bearing Deposits | 22.9 | | | 21.9 | | | 16.6 | | | 15.0 | | | 13.6 | | | 12.0 | | | 12.0 | | | 12.0 | | | | | |
| | 3.4 | | | 3.5 | | | 3.1 | | | 3.0 | | | 3.3 | | | Other Liabilities | 2.8 | | | 2.7 | | | 3.1 | | | 3.4 | | | 3.0 | | | 3.0 | | | 3.4 | | | 3.9 | | | | | |
| | 90.9 | | | 91.8 | | | 92.5 | | | 92.7 | | | 91.9 | | | | Total Liabilities | 92.9 | | | 92.9 | | | 92.5 | | | 92.6 | | | 92.4 | | | 92.2 | | | 91.8 | | | 91.4 | | | | | |
| | 8.3 | | | 7.5 | | | 6.9 | | | 6.7 | | | 7.4 | | | Common Equity | 6.6 | | | 6.5 | | | 6.9 | | | 6.8 | | | 7.0 | | | 7.2 | | | 7.6 | | | 7.9 | | | | | |
| | 0.8 | | | 0.6 | | | 0.6 | | | 0.6 | | | 0.6 | | | Preferred Equity | 0.5 | | | 0.6 | | | 0.6 | | | 0.6 | | | 0.6 | | | 0.6 | | | 0.6 | | | 0.6 | | | | | |
| | 9.1 | | | 8.2 | | | 7.5 | | | 7.3 | | | 8.1 | | | | Total Stockholders' Equity | 7.1 | | | 7.1 | | | 7.5 | | | 7.4 | | | 7.6 | | | 7.8 | | | 8.2 | | | 8.6 | | | | | |
| | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | | Total Liabilities and Stockholders' Equity | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | 100.0 | % | | | | |
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(1) | Summations may not equal due to rounding. | | | | |
(2) | Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | |
(3) | Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC. | | | | |
(4) | Cash and Due from Banks and Other Central Bank Deposits includes the noninterest-bearing component of Federal Reserve and Other Central Bank Deposits as presented on the consolidated balance sheets in our periodic filings with the SEC. | | | | |
(5) | Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago. | | | | |
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Northern Trust Corporation |
INTEREST RATE TRENDS (FTE(1) Basis) |
PERIOD AVERAGES |
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| | Net Interest Income (FTE Adjusted), a non-GAAP financial measure, includes adjustments to a fully taxable equivalent basis for loans and securities. A reconciliation of net interest income, net interest margin, and net interest spread on a GAAP basis to net interest income, net interest margin, and net interest spread on an FTE basis, respectively, (each of which is a non-GAAP financial measure) is provided on pages 11 and 12. Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets. Net interest spread is calculated as the difference between the interest rate earned (annualized interest income divided by average interest-earning assets) and the interest rate incurred (annualized interest expense divided by average interest-related funds). |
| | | | | | | | | | | | | | | | 2022 | | 2023 |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | Earnings Assets | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr |
| | 0.98 | % | | 0.10 | % | | 0.03 | % | | 1.30 | % | | 4.69 | % | | | Federal Reserve and Other Central Bank Deposits | | 0.16 | % | | 0.65 | % | | 1.76 | % | | 3.15 | % | | 4.17 | % | | 4.65 | % | | 4.99 | % | | 5.11 | % |
| | 1.21 | % | | 0.41 | % | | 0.16 | % | | 1.11 | % | | 3.00 | % | | | Interest-Bearing Due from and Deposits with Banks(2) | | 0.24 | % | | 0.62 | % | | 1.45 | % | | 2.18 | % | | 2.72 | % | | 2.82 | % | | 3.22 | % | | 3.25 | % |
| | 2.73 | % | | 1.37 | % | | 0.41 | % | | 3.22 | % | | 4.92 | % | | | Federal Funds Sold | | 0.45 | % | | 0.75 | % | | 2.79 | % | | 3.91 | % | | 4.79 | % | | 5.25 | % | | 5.62 | % | | 5.63 | % |
| | 2.10 | % | | 0.31 | % | | 0.33 | % | | 9.68 | % | | 166.71 | % | | | Securities Purchased under Agreements to Resell(5) | | 0.50 | % | | 2.47 | % | | 9.51 | % | | 22.24 | % | | 48.80 | % | | 92.09 | % | | 193.58 | % | | 492.23 | % |
| | | | | | | | | | | | | Debt Securities: | | | | | | | | | | | | | | | | |
| | 2.51 | % | | 1.77 | % | | 1.28 | % | | 1.91 | % | | 4.35 | % | | | | Available for Sale | | 1.30 | % | | 1.55 | % | | 2.10 | % | | 3.02 | % | | 3.80 | % | | 4.17 | % | | 4.51 | % | | 4.94 | % |
| | 0.94 | % | | 0.59 | % | | 0.80 | % | | 1.26 | % | | 1.87 | % | | | | Held to Maturity | | 0.94 | % | | 1.11 | % | | 1.38 | % | | 1.54 | % | | 1.64 | % | | 1.80 | % | | 1.93 | % | | 2.13 | % |
| | 3.29 | % | | 3.27 | % | | 1.59 | % | | 3.84 | % | | 13.50 | % | | | | Trading Account | | 10.09 | % | | 5.40 | % | | 23.60 | % | | 3.54 | % | | 7.63 | % | | 42.53 | % | | 21.15 | % | | 5.19 | % |
| | 2.14 | % | | 1.46 | % | | 1.11 | % | | 1.64 | % | | 3.08 | % | | | | Total Debt Securities | | 1.17 | % | | 1.39 | % | | 1.76 | % | | 2.30 | % | | 2.72 | % | | 2.97 | % | | 3.18 | % | | 3.46 | % |
| | 3.74 | % | | 2.32 | % | | 1.92 | % | | 3.28 | % | | 6.06 | % | | | Loans and Leases | | 1.97 | % | | 2.53 | % | | 3.64 | % | | 4.86 | % | | 5.60 | % | | 6.06 | % | | 6.26 | % | | 6.32 | % |
| | 3.56 | % | | 3.63 | % | | 3.43 | % | | 4.03 | % | | 4.87 | % | | | Other Interest-Earning Assets(3) | | 2.69 | % | | 4.07 | % | | 3.92 | % | | 5.14 | % | | 4.67 | % | | 5.04 | % | | 4.65 | % | | 5.05 | % |
| | 2.36 | % | | 1.35 | % | | 1.00 | % | | 2.11 | % | | 5.64 | % | | | | Total Earning Assets | | 1.06 | % | | 1.54 | % | | 2.44 | % | | 3.52 | % | | 4.38 | % | | 5.23 | % | | 6.03 | % | | 7.04 | % |
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| | | | | | | | | | | | Interest-Bearing Funds | | | | | | | | | | | | | | | | |
| | 0.97 | % | | 0.20 | % | | 0.05 | % | | 0.74 | % | | 2.85 | % | | | Savings, Money Market and Other | | 0.04 | % | | 0.24 | % | | 0.94 | % | | 1.83 | % | | 2.35 | % | | 2.67 | % | | 3.05 | % | | 3.40 | % |
| | 1.86 | % | | 1.30 | % | | 0.55 | % | | 1.68 | % | | 4.54 | % | | | Savings Certificates and Other Time | | 0.51 | % | | 0.58 | % | | 1.61 | % | | 2.86 | % | | 3.70 | % | | 4.23 | % | | 4.69 | % | | 5.10 | % |
| | 0.57 | % | | (0.03) | % | | (0.11) | % | | 0.56 | % | | 3.07 | % | | | Non- U.S. Offices - Interest-Bearing | | (0.12) | % | | 0.02 | % | | 0.65 | % | | 1.70 | % | | 2.50 | % | | 2.90 | % | | 3.38 | % | | 3.56 | % |
| | 0.68 | % | | 0.06 | % | | (0.06) | % | | 0.63 | % | | 3.07 | % | | | | Total Interest-Bearing Deposits | | (0.06) | % | | 0.10 | % | | 0.75 | % | | 1.76 | % | | 2.49 | % | | 2.89 | % | | 3.35 | % | | 3.59 | % |
| | 2.05 | % | | 0.22 | % | | (0.19) | % | | 2.43 | % | | 4.99 | % | | | Federal Funds Purchased | | 0.05 | % | | 1.22 | % | | 2.00 | % | | 3.14 | % | | 4.45 | % | | 4.97 | % | | 5.18 | % | | 5.25 | % |
| | 1.89 | % | | 0.47 | % | | 0.07 | % | | 20.94 | % | | 383.84 | % | | | Securities Sold under Agreements to Repurchase(5) | | 0.49 | % | | 4.01 | % | | 20.72 | % | | 59.59 | % | | 135.62 | % | | 234.39 | % | | 422.85 | % | | 759.25 | % |
| | 2.34 | % | | 0.71 | % | | 0.28 | % | | 2.31 | % | | 5.25 | % | | | Other Borrowings(4) | | 0.35 | % | | 0.80 | % | | 2.36 | % | | 3.95 | % | | 4.83 | % | | 5.17 | % | | 5.59 | % | | 5.49 | % |
| | 3.04 | % | | 2.24 | % | | 1.69 | % | | 3.36 | % | | 6.22 | % | | | Senior Notes | | 1.59 | % | | 2.65 | % | | 3.79 | % | | 5.18 | % | | 5.79 | % | | 6.14 | % | | 6.44 | % | | 6.50 | % |
| | 3.36 | % | | 2.24 | % | | 1.81 | % | | 3.49 | % | | 5.69 | % | | | Long-Term Debt | | 1.94 | % | | 2.47 | % | | 3.41 | % | | 5.19 | % | | 5.73 | % | | 5.89 | % | | 5.94 | % | | 5.45 | % |
| | 2.98 | % | | 1.52 | % | | 0.78 | % | | — | % | | — | % | | | Floating Rate Capital Debt | | — | % | | — | % | | — | % | | — | % | | — | % | | — | % | | — | % | | — | % |
| | 0.96 | % | | 0.21 | % | | 0.02 | % | | 0.92 | % | | 4.91 | % | | | | Total Interest-Related Funds | | 0.01 | % | | 0.25 | % | | 1.07 | % | | 2.30 | % | | 3.34 | % | | 4.36 | % | | 5.48 | % | | 6.60 | % |
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| | 1.40 | % | | 1.14 | % | | 0.98 | % | | 1.19 | % | | 0.73 | % | | | Net Interest Spread | | 1.05 | % | | 1.29 | % | | 1.37 | % | | 1.22 | % | | 1.04 | % | | 0.87 | % | | 0.55 | % | | 0.44 | % |
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| | 1.60 | % | | 1.19 | % | | 0.99 | % | | 1.39 | % | | 1.56 | % | | | Net Interest Margin | | 1.05 | % | | 1.35 | % | | 1.58 | % | | 1.63 | % | | 1.62 | % | | 1.57 | % | | 1.45 | % | | 1.59 | % |
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| (1) | Fully taxable equivalent. FTE adjustments are based on a federal income tax rate of 21%, where the rate is adjusted for applicable state income taxes, net of related federal tax benefit. |
| (2) | Interest-Bearing Due from and Deposits with Banks includes the interest-bearing component of Cash and Due from Banks and Interest-Bearing Deposits with Banks as presented on the consolidated balance sheets in our periodic filings with the SEC. |
| (3) | Other Interest-Earning Assets include certain community development investments, collateral deposits with certain securities depositories and clearing houses, Federal Home Loan Bank and Federal Reserve stock, and money market investments which are classified in Other Assets on the consolidated balance sheets in our periodic filings with the SEC. |
| (4) | Other Borrowings primarily includes advances from the Federal Home Loan Bank of Chicago. |
| (5) | Includes the impact of balance sheet netting under master netting arrangements of approximately $51.1 billion for the three months ended December 31, 2023. Excluding the impact of netting, the average interest rate on Securities Purchased under Agreements to Resell would be approximately 5.46% for the three months ended December 31, 2023. Excluding the impact of netting, the average interest rate on Securities Sold under Agreements to Repurchase would be approximately 5.38% for the three months ended December 31, 2023. See previous filings for impact of netting on prior periods. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Northern Trust Corporation |
ASSET QUALITY |
END OF PERIOD |
($ in Millions) |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | 2022 | | 2023 | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | | | | | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 138.2 | | | $ | 124.4 | | | $ | 259.9 | | | $ | 184.7 | | | $ | 200.9 | | | Beginning Allowance for Credit Losses | | $ | 184.7 | | | $ | 189.9 | | | $ | 199.9 | | | $ | 195.9 | | | $ | 200.9 | | | $ | 213.0 | | | $ | 197.5 | | | $ | 211.8 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | — | | | 13.7 | | | — | | | — | | | — | | | Cumulative Effect Adjustment(1) | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (14.5) | | | 125.0 | | | (81.5) | | | 12.0 | | | 24.5 | | | Provision for (Release of) Credit Losses | | 2.0 | | | 4.5 | | | 0.5 | | | 5.0 | | | 15.0 | | | (15.5) | | | 14.0 | | | 11.0 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | (Charge-offs) Recoveries | | | | | | | | | | | | | | | | | | |
| | (6.5) | | | (9.7) | | | (0.7) | | | (6.0) | | | (8.7) | | | | Charge-offs | | (0.1) | | | — | | | (5.4) | | | (0.5) | | | (4.0) | | | (0.8) | | | (0.8) | | | (3.1) | | | |
| | 7.2 | | | 6.5 | | | 7.0 | | | 10.2 | | | 3.7 | | | | Recoveries | | 3.3 | | | 5.5 | | | 0.9 | | | 0.5 | | | 1.1 | | | 0.8 | | | 1.1 | | | 0.7 | | | |
| | 0.7 | | | (3.2) | | | 6.3 | | | 4.2 | | | (5.0) | | | | | Net (Charge-offs) Recoveries | | 3.2 | | | 5.5 | | | (4.5) | | | — | | | (2.9) | | | — | | | 0.3 | | | (2.4) | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 124.4 | | | $ | 259.9 | | | $ | 184.7 | | | $ | 200.9 | | | $ | 220.4 | | | | | | Ending Allowance for Credit Losses | | $ | 189.9 | | | $ | 199.9 | | | $ | 195.9 | | | $ | 200.9 | | | $ | 213.0 | | | $ | 197.5 | | | $ | 211.8 | | | $ | 220.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Allowance for Credit Losses Assigned to: | | | | | | | | | | | | | | | | | | |
| | $ | 104.5 | | | $ | 190.7 | | | $ | 138.4 | | | $ | 144.3 | | | $ | 178.7 | | | | Loans and Leases | | $ | 136.3 | | | $ | 138.2 | | | $ | 138.7 | | | $ | 144.3 | | | $ | 159.9 | | | $ | 152.5 | | | $ | 166.8 | | | $ | 178.7 | | | |
| | 19.9 | | | 61.1 | | | 34.1 | | | 38.5 | | | 26.9 | | | | Undrawn Loan Commitments and Standby Letters of Credit | | 37.5 | | | 43.5 | | | 40.7 | | | 38.5 | | | 34.3 | | | 26.0 | | | 28.3 | | | 26.9 | | | |
| | — | | | 8.1 | | | 12.2 | | | 18.1 | | | 14.8 | | | | Debt Securities and Other Financial Assets | | 16.1 | | | 18.2 | | | 16.5 | | | 18.1 | | | 18.8 | | | 19.0 | | | 16.7 | | | 14.8 | | | |
| | $ | 124.4 | | | $ | 259.9 | | | $ | 184.7 | | | $ | 200.9 | | | $ | 220.4 | | | | | Total Allowance for Credit Losses | | $ | 189.9 | | | $ | 199.9 | | | $ | 195.9 | | | $ | 200.9 | | | $ | 213.0 | | | $ | 197.5 | | | $ | 211.8 | | | $ | 220.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 31,053 | | | $ | 33,499 | | | $ | 37,208 | | | $ | 41,031 | | | $ | 42,177 | | | Average Loans and Leases Outstanding | | $ | 39,544 | | | $ | 40,747 | | | $ | 41,466 | | | $ | 42,329 | | | $ | 41,959 | | | $ | 42,365 | | | $ | 42,210 | | | $ | 42,170 | | | |
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| | — | % | | (0.01) | % | | 0.02 | % | | 0.01 | % | | (0.01) | % | | Annualized Loan-Related Net (Charge-offs) Recoveries to | | 0.03 | % | | 0.05 | % | | (0.04) | % | | — | % | | (0.03) | % | | — | % | | — | % | | (0.02) | % | | |
| | | | | | | | | | | | | Average Loans and Leases | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 31,410 | | | $ | 33,760 | | | $ | 40,481 | | | $ | 42,893 | | | $ | 47,617 | | | End of Period Loans and Leases Outstanding | | $ | 39,239 | | | $ | 41,208 | | | $ | 43,992 | | | $ | 42,893 | | | $ | 42,370 | | | $ | 43,547 | | | $ | 43,577 | | | $ | 47,617 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 0.33 | % | | 0.56 | % | | 0.34 | % | | 0.34 | % | | 0.38 | % | | Allowance for Credit Losses Assigned to Loans | | 0.35 | % | | 0.34 | % | | 0.32 | % | | 0.34 | % | | 0.38 | % | | 0.35 | % | | 0.38 | % | | 0.38 | % | | |
| | | | | | | | | | | | | and Leases to Total Loans and Leases | | | | | | | | | | | | | | | | | | |
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| | | | | | | | | | | | Nonaccrual Assets | | | | | | | | | | | | | | | | | | |
| | $ | 83.6 | | | $ | 131.7 | | | $ | 122.3 | | | $ | 45.9 | | | $ | 63.6 | | | | Nonaccrual Loans and Leases | | $ | 100.8 | | | $ | 89.7 | | | $ | 76.4 | | | $ | 45.9 | | | $ | 48.9 | | | $ | 47.1 | | | $ | 68.8 | | | $ | 63.6 | | | |
| | 3.2 | | | 0.7 | | | 3.0 | | | — | | | 1.5 | | | | Other Real Estate Owned (OREO) | | 0.2 | | | 0.1 | | | — | | | — | | | — | | | 0.3 | | | 0.3 | | | 1.5 | | | |
| | $ | 86.8 | | | $ | 132.4 | | | $ | 125.3 | | | $ | 45.9 | | | $ | 65.1 | | | | | Total Nonaccrual Assets | | $ | 101.0 | | | $ | 89.8 | | | $ | 76.4 | | | $ | 45.9 | | | $ | 48.9 | | | $ | 47.4 | | | $ | 69.1 | | | $ | 65.1 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 0.28 | % | | 0.39 | % | | 0.31 | % | | 0.11 | % | | 0.14 | % | | Nonaccrual Assets to Loans and Leases and OREO | | 0.26 | % | | 0.22 | % | | 0.17 | % | | 0.11 | % | | 0.12 | % | | 0.11 | % | | 0.16 | % | | 0.14 | % | | |
| | | | | | | | | | | | Loans and Leases Allowance to Nonaccrual | | | | | | | | | | | | | | | | | | |
| | 1.3x | | 1.4x | | 1.1x | | 3.1x | | 2.8x | | | Loans and Leases | | 1.4x | | 1.5x | | 1.8x | | 3.1x | | 3.3x | | 3.2x | | 2.4x | | 2.8x | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Upon the January 1, 2020 adoption of ASU 2016-13, Northern Trust increased the allowance for credit losses by $13.7 million, with a corresponding cumulative effect adjustment to decrease retained earnings $10.1 million, net of tax. | |
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Northern Trust Corporation |
ASSETS UNDER MANAGEMENT AND CUSTODY |
END OF PERIOD |
($ in Billions) |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | 2022 | | 2023 | | |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | Assets Under Management | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | |
| | $ | 917.5 | | | $ | 1,057.5 | | | $ | 1,191.0 | | | $ | 898.1 | | | $ | 1,032.0 | | | Asset Servicing | | $ | 1,091.6 | | | $ | 950.0 | | | $ | 873.7 | | | $ | 898.1 | | | $ | 962.1 | | | $ | 989.8 | | | $ | 963.4 | | | $ | 1,032.0 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | 483.8 | | | 551.7 | | | 626.6 | | | 485.0 | | | 563.9 | | | | | Equities | | 582.8 | | | 479.1 | | | 444.1 | | | 485.0 | | | 515.1 | | | 535.4 | | | 508.7 | | | 563.9 | | | |
| | 114.6 | | | 120.1 | | | 132.6 | | | 107.1 | | | 116.2 | | | | | Fixed Income Securities | | 122.8 | | | 114.8 | | | 103.1 | | | 107.1 | | | 107.3 | | | 108.8 | | | 109.7 | | | 116.2 | | | |
| | 156.1 | | | 198.8 | | | 236.2 | | | 157.7 | | | 184.5 | | | | | Cash and Other Assets | | 208.8 | | | 186.8 | | | 164.4 | | | 157.7 | | | 171.8 | | | 176.8 | | | 183.0 | | | 184.5 | | | |
| | 163.0 | | | 186.9 | | | 195.6 | | | 148.3 | | | 167.4 | | | | | Securities Lending Collateral | | 177.2 | | | 169.3 | | | 162.1 | | | 148.3 | | | 167.9 | | | 168.8 | | | 162.0 | | | 167.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 313.8 | | | $ | 347.8 | | | $ | 416.1 | | | $ | 351.4 | | | $ | 402.5 | | | Wealth Management | | $ | 396.2 | | | $ | 352.8 | | | $ | 336.2 | | | $ | 351.4 | | | $ | 368.3 | | | $ | 376.0 | | | $ | 369.9 | | | $ | 402.5 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | 167.0 | | | 182.0 | | | 229.9 | | | 186.3 | | | 221.6 | | | | | Equities | | 218.1 | | | 185.0 | | | 171.0 | | | 186.3 | | | 197.0 | | | 205.1 | | | 197.8 | | | 221.6 | | | |
| | 79.2 | | | 84.7 | | | 83.5 | | | 79.4 | | | 87.2 | | | | | Fixed Income Securities | | 81.6 | | | 80.1 | | | 79.5 | | | 79.4 | | | 80.3 | | | 79.9 | | | 80.5 | | | 87.2 | | | |
| | 67.5 | | | 81.1 | | | 102.7 | | | 85.7 | | | 93.7 | | | | | Cash and Other Assets | | 96.5 | | | 87.7 | | | 85.7 | | | 85.7 | | | 91.0 | | | 91.0 | | | 91.6 | | | 93.7 | | | |
| | 0.1 | | | — | | | — | | | — | | | — | | | | | Securities Lending Collateral | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | |
| | $ | 1,231.3 | | | $ | 1,405.3 | | | $ | 1,607.1 | | | $ | 1,249.5 | | | $ | 1,434.5 | | | Total Assets Under Management | | $ | 1,487.8 | | | $ | 1,302.8 | | | $ | 1,209.9 | | | $ | 1,249.5 | | | $ | 1,330.4 | | | $ | 1,365.8 | | | $ | 1,333.3 | | | $ | 1,434.5 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | $ | 650.8 | | | $ | 733.7 | | | $ | 856.5 | | | $ | 671.3 | | | $ | 785.5 | | | | | Equities | | $ | 800.9 | | | $ | 664.1 | | | $ | 615.1 | | | $ | 671.3 | | | $ | 712.1 | | | $ | 740.5 | | | $ | 706.5 | | | $ | 785.5 | | | |
| | 193.8 | | | 204.8 | | | 216.1 | | | 186.5 | | | 203.4 | | | | | Fixed Income Securities | | 204.4 | | | 194.9 | | | 182.6 | | | 186.5 | | | 187.6 | | | 188.7 | | | 190.2 | | | 203.4 | | | |
| | 223.6 | | | 279.9 | | | 338.9 | | | 243.4 | | | 278.2 | | | | | Cash and Other Assets | | 305.3 | | | 274.5 | | | 250.1 | | | 243.4 | | | 262.8 | | | 267.8 | | | 274.6 | | | 278.2 | | | |
| | 163.1 | | | 186.9 | | | 195.6 | | | 148.3 | | | 167.4 | | | | | Securities Lending Collateral | | 177.2 | | | 169.3 | | | 162.1 | | | 148.3 | | | 167.9 | | | 168.8 | | | 162.0 | | | 167.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Assets Under Custody / Administration | | | | | | | | | | | | | | | | | | |
| | $ | 11,311.6 | | | $ | 13,653.1 | | | $ | 15,183.2 | | | $ | 12,705.5 | | | $ | 14,362.6 | | | | Asset Servicing | | $ | 14,513.0 | | | $ | 12,812.2 | | | $ | 11,954.0 | | | $ | 12,705.5 | | | $ | 13,221.5 | | | $ | 13,483.5 | | | $ | 13,206.2 | | | $ | 14,362.6 | | | |
| | 738.8 | | | 879.4 | | | 1,065.6 | | | 898.5 | | | 1,042.3 | | | | Wealth Management | | 1,031.1 | | | 921.5 | | | 868.0 | | | 898.5 | | | 953.3 | | | 995.4 | | | 958.5 | | | 1,042.3 | | | |
| | $ | 12,050.4 | | | $ | 14,532.5 | | | $ | 16,248.8 | | | $ | 13,604.0 | | | $ | 15,404.9 | | | Total Assets Under Custody / Administration | | $ | 15,544.1 | | | $ | 13,733.7 | | | $ | 12,822.0 | | | $ | 13,604.0 | | | $ | 14,174.8 | | | $ | 14,478.9 | | | $ | 14,164.7 | | | $ | 15,404.9 | | | |
| | | | | | | | | | | | Assets Under Custody | | | | | | | | | | | | | | | | | | |
| | $ | 8,497.8 | | | $ | 10,387.7 | | | $ | 11,554.8 | | | $ | 9,712.3 | | | $ | 10,882.0 | | | Asset Servicing | | $ | 10,987.5 | | | $ | 9,771.2 | | | $ | 9,125.5 | | | $ | 9,712.3 | | | $ | 10,065.6 | | | $ | 10,295.7 | | | $ | 10,064.4 | | | $ | 10,882.0 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | 3,866.6 | | | 4,751.0 | | | 5,404.3 | | | 4,312.8 | | | 5,028.9 | | | | | Equities | | 5,062.5 | | | 4,272.7 | | | 3,939.7 | | | 4,312.8 | | | 4,546.1 | | | 4,739.3 | | | 4,590.7 | | | 5,028.9 | | | |
| | 3,102.3 | | | 3,742.6 | | | 3,997.5 | | | 3,252.1 | | | 3,600.4 | | | | | Fixed Income Securities | | 3,768.9 | | | 3,378.8 | | | 3,157.1 | | | 3,252.1 | | | 3,366.8 | | | 3,394.2 | | | 3,316.7 | | | 3,600.4 | | | |
| | 1,365.9 | | | 1,707.2 | | | 1,957.4 | | | 1,999.1 | | | 2,085.3 | | | | | Cash and Other Assets | | 1,978.9 | | | 1,950.4 | | | 1,866.6 | | | 1,999.1 | | | 1,984.8 | | | 1,993.4 | | | 1,995.0 | | | 2,085.3 | | | |
| | 163.0 | | | 186.9 | | | 195.6 | | | 148.3 | | | 167.4 | | | | | Securities Lending Collateral | | 177.2 | | | 169.3 | | | 162.1 | | | 148.3 | | | 167.9 | | | 168.8 | | | 162.0 | | | 167.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 735.7 | | | $ | 875.1 | | | $ | 1,057.5 | | | $ | 892.3 | | | $ | 1,034.5 | | | Wealth Management | | $ | 1,022.9 | | | $ | 913.0 | | | $ | 860.8 | | | $ | 892.3 | | | $ | 947.6 | | | $ | 989.1 | | | $ | 951.0 | | | $ | 1,034.5 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | 432.0 | | | 542.9 | | | 644.8 | | | 497.9 | | | 623.6 | | | | | Equities | | 615.2 | | | 512.8 | | | 469.3 | | | 497.9 | | | 545.0 | | | 589.4 | | | 550.7 | | | 623.6 | | | |
| | 134.3 | | | 128.3 | | | 142.1 | | | 134.0 | | | 136.7 | | | | | Fixed Income Securities | | 140.5 | | | 135.0 | | | 131.6 | | | 134.0 | | | 134.6 | | | 130.5 | | | 128.3 | | | 136.7 | | | |
| | 169.3 | | | 203.9 | | | 270.6 | | | 260.4 | | | 274.2 | | | | | Cash and Other Assets | | 267.2 | | | 265.2 | | | 259.9 | | | 260.4 | | | 268.0 | | | 269.2 | | | 272.0 | | | 274.2 | | | |
| | 0.1 | | | — | | | — | | | — | | | — | | | | | Securities Lending Collateral | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | |
| | $ | 9,233.5 | | | $ | 11,262.8 | | | $ | 12,612.3 | | | $ | 10,604.6 | | | $ | 11,916.5 | | | Total Assets Under Custody | | $ | 12,010.4 | | | $ | 10,684.2 | | | $ | 9,986.3 | | | $ | 10,604.6 | | | $ | 11,013.2 | | | $ | 11,284.8 | | | $ | 11,015.4 | | | $ | 11,916.5 | | | |
| | | | | | | | | | | | | Asset allocation: | | | | | | | | | | | | | | | | | | |
| | $ | 4,298.6 | | | $ | 5,293.9 | | | $ | 6,049.1 | | | $ | 4,810.7 | | | $ | 5,652.5 | | | | | Equities | | $ | 5,677.7 | | | $ | 4,785.5 | | | $ | 4,409.0 | | | $ | 4,810.7 | | | $ | 5,091.1 | | | $ | 5,328.7 | | | $ | 5,141.4 | | | $ | 5,652.5 | | | |
| | 3,236.6 | | | 3,870.9 | | | 4,139.6 | | | 3,386.1 | | | 3,737.1 | | | | | Fixed Income Securities | | 3,909.4 | | | 3,513.8 | | | 3,288.7 | | | 3,386.1 | | | 3,501.4 | | | 3,524.7 | | | 3,445.0 | | | 3,737.1 | | | |
| | 1,535.2 | | | 1,911.1 | | | 2,228.0 | | | 2,259.5 | | | 2,359.5 | | | | | Cash and Other Assets | | 2,246.1 | | | 2,215.6 | | | 2,126.5 | | | 2,259.5 | | | 2,252.8 | | | 2,262.6 | | | 2,267.0 | | | 2,359.5 | | | |
| | 163.1 | | | 186.9 | | | 195.6 | | | 148.3 | | | 167.4 | | | | | Securities Lending Collateral | | 177.2 | | | 169.3 | | | 162.1 | | | 148.3 | | | 167.9 | | | 168.8 | | | 162.0 | | | 167.4 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Memo | | | | | | | | | | | | | | | | | | |
| | $ | 94.2 | | | $ | 114.0 | | | $ | 144.9 | | | $ | 119.9 | | | $ | 144.3 | | | | WM Global Family Office AUM | | $ | 136.6 | | | $ | 121.9 | | | $ | 117.1 | | | $ | 119.9 | | | $ | 126.2 | | | $ | 128.5 | | | $ | 128.9 | | | $ | 144.3 | | | |
| | 474.1 | | | 600.7 | | | 742.6 | | | 614.9 | | | 728.0 | | | | WM Global Family Office AUC | | 720.8 | | | 642.2 | | | 598.4 | | | 614.9 | | | 660.0 | | | 694.0 | | | 663.5 | | | 728.0 | | | |
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Northern Trust Corporation |
RECONCILIATION TO FULLY TAXABLE EQUIVALENT |
($ in Millions) |
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| Northern Trust presents certain financial measures on a fully taxable equivalent (FTE) basis, which is a non-generally accepted accounting principle (GAAP). Management believes an FTE presentation provides a clearer indication of these financial measures for comparative purposes.
Net interest income (FTE) – Non-GAAP and net interest margin (FTE) – Non-GAAP and other FTE measures include the tax equivalent adjustments on tax-exempt income, consistent with industry practice. The adjustments are based on the federal income tax rate, where the rate is adjusted for applicable state income taxes, net of related federal tax benefit. When adjusted to an FTE basis, yields on taxable, nontaxable, and partially taxable assets are comparable; however, the adjustment to an FTE basis has no impact on net income. Below is a reconciliation of the financial measures presented on an FTE basis. |
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| | | | | | | | | | | | | | | | | | 2022 | | 2023 |
| 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | | | | | | | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr |
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| $ | 2,499.9 | | | $ | 1,643.5 | | | $ | 1,406.5 | | | $ | 2,877.7 | | | $ | 7,325.0 | | | | | | | Interest Income - GAAP | | $ | 383.5 | | | $ | 524.8 | | | $ | 799.3 | | | $ | 1,170.1 | | | $ | 1,455.4 | | | $ | 1,735.0 | | | $ | 1,935.0 | | | $ | 2,199.6 | |
| 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | | | | | Add: FTE Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | 13.2 | | 18.0 |
| 2,532.7 | | | 1,677.9 | | | 1,442.1 | | | 2,923.3 | | | 7,382.5 | | | | | | | | Interest Income (FTE) - Non-GAAP | | 390.2 | | | 535.9 | | | 811.6 | | | 1,185.6 | | | 1,468.6 | | | 1,748.1 | | | 1,948.2 | | | 2,217.6 | |
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| 1,677.9 | | | 1,443.2 | | | 1,382.7 | | | 1,887.2 | | | 1,982.0 | | | | | | | Net Interest Income - GAAP | | 381.0 | | | 458.7 | | | 513.0 | | | 534.5 | | | 531.2 | | | 511.5 | | 456.2 | | 483.1 |
| 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | | | | | Add: FTE Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | 13.2 | | 18.0 |
| 1,710.7 | | | 1,477.6 | | | 1,418.3 | | | 1,932.8 | | | 2,039.5 | | | | | | | | Net Interest Income (FTE) - Non-GAAP | | 387.7 | | | 469.8 | | | 525.3 | | | 550.0 | | | 544.4 | | | 524.6 | | 469.4 | | 501.1 |
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| 6,073.1 | | | 6,100.8 | | | 6,464.5 | | | 6,761.2 | | | 6,773.5 | | | | | | | Total Revenue - GAAP | | 1,718.7 | | | 1,768.7 | | | 1,754.8 | | | 1,519.0 | | | 1,744.6 | | | 1,757.1 | | | 1,726.5 | | | 1,545.3 | |
| 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | | | | | Add: FTE Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | 13.2 | | 18.0 |
| 6,105.9 | | | 6,135.2 | | | 6,500.1 | | | 6,806.8 | | | 6,831.0 | | | | | | | | Total Revenue (FTE) - Non-GAAP | | 1,725.4 | | | 1,779.8 | | | 1,767.1 | | | 1,534.5 | | | 1,757.8 | | | 1,770.2 | | | 1,739.7 | | | 1,563.3 | |
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| 1,944.1 | | | 1,627.6 | | | 2,010.1 | | | 1,766.3 | | | 1,464.8 | | | | | | | Income before Income Taxes - GAAP | | 510.8 | | | 540.6 | | | 524.5 | | | 190.4 | | | 444.0 | | | 440.7 | | 434.3 | | 145.8 |
| 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | | | | | Add: FTE Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | 13.2 | | 18.0 |
| 1,976.9 | | | 1,662.0 | | | 2,045.7 | | | 1,811.9 | | | 1,522.3 | | | | | | | | Income before Income Taxes (FTE) - Non-GAAP | | 517.5 | | | 551.7 | | | 536.8 | | | 205.9 | | | 457.2 | | | 453.8 | | 447.5 | | 163.8 |
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| 451.9 | | | 418.3 | | | 464.8 | | | 430.3 | | | 357.5 | | | | | | | Provision for Income Taxes - GAAP | | 121.5 | | | 144.4 | | | 129.7 | | | 34.7 | | | 109.4 | | | 108.9 | | 106.5 | | 32.7 |
| 32.8 | | | 34.4 | | | 35.6 | | | 45.6 | | | 57.5 | | | | | | | Add: FTE Adjustment | | 6.7 | | | 11.1 | | | 12.3 | | | 15.5 | | | 13.2 | | | 13.1 | | 13.2 | | 18.0 |
| 484.7 | | | 452.7 | | | 500.4 | | | 475.9 | | | 415.0 | | | | | | | | Provision for Income Taxes (FTE) - Non-GAAP | | 128.2 | | | 155.5 | | | 142.0 | | | 50.2 | | | 122.6 | | | 122.0 | | 119.7 | | 50.7 |
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Northern Trust Corporation |
RECONCILIATION TO FULLY TAXABLE EQUIVALENT |
RATIOS |
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| | Northern Trust presents certain financial measures on a fully taxable equivalent (FTE) basis, which is a non-generally accepted accounting principle (GAAP). Management believes an FTE presentation provides a clearer indication of these financial measures for comparative purposes.
Net interest income (FTE) – Non-GAAP and net interest margin (FTE) – Non-GAAP and other FTE measures include the tax equivalent adjustments on tax-exempt income, consistent with industry practice. The adjustments are based on the federal income tax rate, where the rate is adjusted for applicable state income taxes, net of related federal tax benefit. When adjusted to an FTE basis, yields on taxable, nontaxable, and partially taxable assets are comparable; however, the adjustment to an FTE basis has no impact on net income. Below is a reconciliation of the financial ratios presented on an FTE basis. |
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| | | | | | | | | | | | | | 2022 | | 2023 |
| | 2019 | | 2020 | | 2021 | | 2022 | | 2023 | | | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr | | 1st Qtr | | 2nd Qtr | | 3rd Qtr | | 4th Qtr |
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| | 32.0 | % | | 26.7 | % | | 31.1 | % | | 26.1 | % | | 21.6 | % | | Profit Margin (pre-tax) - GAAP (1) | | 29.7 | % | | 30.6 | % | | 29.9 | % | | 12.5 | % | | 25.4 | % | | 25.1 | % | | 25.2 | % | | 9.4 | % |
| | 32.4 | % | | 27.1 | % | | 31.5 | % | | 26.6 | % | | 22.3 | % | | Profit Margin (pre-tax) (FTE) - Non-GAAP (1) | | 30.0 | % | | 31.0 | % | | 30.4 | % | | 13.4 | % | | 26.0 | % | | 25.6 | % | | 25.7 | % | | 10.5 | % |
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| | 24.6 | % | | 19.8 | % | | 23.9 | % | | 19.8 | % | | 16.3 | % | | Profit Margin (after-tax) - GAAP (2) | | 22.7 | % | | 22.4 | % | | 22.5 | % | | 10.2 | % | | 19.2 | % | | 18.9 | % | | 19.0 | % | | 7.3 | % |
| | 24.4 | % | | 19.7 | % | | 23.8 | % | | 19.6 | % | | 16.2 | % | | Profit Margin (after-tax) (FTE) - Non-GAAP (2) | | 22.6 | % | | 22.3 | % | | 22.3 | % | | 10.1 | % | | 19.0 | % | | 18.7 | % | | 18.8 | % | | 7.2 | % |
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| | 23.2 | % | | 25.7 | % | | 23.1 | % | | 24.4 | % | | 24.4 | % | | Effective Tax Rate - GAAP (3) | | 23.8 | % | | 26.7 | % | | 24.7 | % | | 18.2 | % | | 24.6 | % | | 24.7 | % | | 24.5 | % | | 22.4 | % |
| | 24.5 | % | | 27.2 | % | | 24.5 | % | | 26.3 | % | | 27.3 | % | | Effective Tax Rate (FTE) - Non-GAAP (3) | | 24.8 | % | | 28.2 | % | | 26.4 | % | | 24.4 | % | | 26.8 | % | | 26.9 | % | | 26.8 | % | | 30.9 | % |
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| | 72.4 | % | | 76.3 | % | | 78.6 | % | | 72.1 | % | | 70.7 | % | | Noninterest Income to Total Revenue - GAAP (4) | | 77.8 | % | | 74.1 | % | | 70.8 | % | | 64.8 | % | | 69.5 | % | | 70.9 | % | | 73.6 | % | | 68.7 | % |
| | 72.0 | % | | 75.9 | % | | 78.2 | % | | 71.6 | % | | 70.1 | % | | Noninterest Income to Total Revenue (FTE) - Non-GAAP (4) | | 77.5 | % | | 73.6 | % | | 70.3 | % | | 64.2 | % | | 69.0 | % | | 70.4 | % | | 73.0 | % | | 67.9 | % |
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| | 63.4 | % | | 65.5 | % | | 67.5 | % | | 65.6 | % | | 64.4 | % | | Trust Fees to Total Revenue - GAAP (5) | | 68.0 | % | | 64.6 | % | | 61.5 | % | | 68.6 | % | | 61.0 | % | | 62.4 | % | | 64.4 | % | | 70.5 | % |
| | 63.1 | % | | 65.1 | % | | 67.1 | % | | 65.1 | % | | 63.9 | % | | Trust Fees to Total Revenue (FTE) - Non-GAAP (5) | | 67.7 | % | | 64.2 | % | | 61.0 | % | | 67.9 | % | | 60.5 | % | | 61.9 | % | | 63.9 | % | | 69.7 | % |
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| | 1.37 | % | | 1.11 | % | | 0.96 | % | | 1.15 | % | | 0.69 | % | | Net Interest Spread - GAAP (6) | | 1.03 | % | | 1.25 | % | | 1.33 | % | | 1.17 | % | | 1.00 | % | | 0.83 | % | | 0.51 | % | | 0.38 | % |
| | 1.40 | % | | 1.14 | % | | 0.98 | % | | 1.19 | % | | 0.73 | % | | Net Interest Spread (FTE) - Non-GAAP (6) | | 1.05 | % | | 1.29 | % | | 1.37 | % | | 1.22 | % | | 1.04 | % | | 0.87 | % | | 0.55 | % | | 0.44 | % |
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| | 1.57 | % | | 1.16 | % | | 0.96 | % | | 1.36 | % | | 1.52 | % | | Net Interest Margin - GAAP (7) | | 1.03 | % | | 1.31 | % | | 1.54 | % | | 1.58 | % | | 1.58 | % | | 1.53 | % | | 1.41 | % | | 1.53 | % |
| | 1.60 | % | | 1.19 | % | | 0.99 | % | | 1.39 | % | | 1.56 | % | | Net Interest Margin (FTE) - Non-GAAP (7) | | 1.05 | % | | 1.35 | % | | 1.58 | % | | 1.63 | % | | 1.62 | % | | 1.57 | % | | 1.45 | % | | 1.59 | % |
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| (1) | Profit margin (pre-tax) is calculated by dividing income before income taxes by total revenue. Profit margin (pre-tax) on an FTE basis is calculated by dividing income before income taxes on an FTE basis by total revenue on an FTE basis. |
| (2) | Profit margin (after-tax) is calculated by dividing net income by total revenue. Profit margin (after-tax) on an FTE basis is calculated by dividing net income by total revenue on an FTE basis. |
| (3) | Effective tax rate is calculated by dividing the provision for income taxes by income before income taxes. Effective tax rate on an FTE basis is calculated by dividing the provision for income taxes on an FTE basis by income before income taxes on an FTE basis. |
| (4) | Noninterest income to total revenue is calculated by dividing noninterest income by total revenue. Noninterest income to total revenue on an FTE basis is calculated by dividing noninterest income by total revenue on an FTE basis. |
| (5) | Trust fees to total revenue is calculated by dividing total trust, investment and other servicing fees by total revenue. Trust fees to total revenue on an FTE basis is calculated by dividing total trust, investment and other servicing fees by total revenue on an FTE basis. |
| (6) | Net interest spread is calculated as the difference between the interest rate earned (annualized interest income divided by average interest-earning assets) and the interest rate incurred (annualized interest expense divided by average interest-related funds). Net interest spread on an FTE basis is calculated as the difference between the interest rate earned (annualized interest income on an FTE basis divided by average interest-earning assets) and the interest rate incurred (annualized interest expense divided by average interest-related funds). |
| (7) | Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets. Net interest margin on an FTE basis is calculated by dividing annualized net interest income on an FTE basis by average interest-earning assets. |
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v3.23.4
Cover Page Cover Page
|
Jan. 18, 2024 |
Entity Information [Line Items] |
|
Document Type |
8-K
|
Document Period End Date |
Jan. 18, 2024
|
Entity Registrant Name |
NORTHERN TRUST CORP
|
Entity Incorporation, State or Country Code |
DE
|
Entity File Number |
001-36609
|
Entity Tax Identification Number |
36-2723087
|
Entity Address, Address Line One |
50 South LaSalle Street
|
Entity Address, State or Province |
IL
|
Entity Address, Postal Zip Code |
60603
|
City Area Code |
312
|
Local Phone Number |
630-6000
|
Written Communications |
false
|
Soliciting Material |
false
|
Pre-commencement Tender Offer |
false
|
Pre-commencement Issuer Tender Offer |
false
|
Entity Emerging Growth Company |
false
|
Entity Central Index Key |
0000073124
|
Amendment Flag |
false
|
Entity Address, City or Town |
Chicago,
|
Common Stock |
|
Entity Information [Line Items] |
|
Title of 12(b) Security |
Common Stock, $1.66 2/3 Par Value
|
Trading Symbol |
NTRS
|
Security Exchange Name |
NASDAQ
|
Depositary Shares |
|
Entity Information [Line Items] |
|
Title of 12(b) Security |
Depositary Shares, each representing 1/1,000th interest in a share of Series E Non-Cumulative Perpetual Preferred Stock
|
Trading Symbol |
NTRSO
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Security Exchange Name |
NASDAQ
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