Core Viewpoint - Northern Trust Corporation is a leading global financial institution with a strong performance in asset servicing, investment management, and wealth management, managing over $1 trillion in assets and having a market capitalization of $23.21 billion [1] Financial Performance - Northern Trust reported third-quarter results that exceeded analyst expectations, with assets under management at $1.77 trillion compared to the expected $1.72 trillion [4] - The company's revenue increased by 2.9% year-over-year to $2.03 billion, surpassing the expected $2.02 billion [4] - Earnings per share (EPS) for the quarter was $2.29, up 3.2% year-over-year and higher than the expected $2.24 [4] Stock Performance - Over the past 52 weeks, Northern Trust's stock has gained 14.6%, outperforming the broader S&P 500 Index, which gained 12.3% during the same period [2][3] - The stock reached a 52-week high of $135.48 in September but has since declined by 7.9% from that level [2] Future Outlook - Analysts project EPS growth of 12.6% year-over-year for fiscal year 2025, reaching $8.67 on a diluted basis, with further growth expected to 8% annually, reaching $9.36 in fiscal 2026 [5] - The company has a strong track record of exceeding consensus estimates, having topped them in all four trailing quarters [5] Analyst Ratings - Among 17 Wall Street analysts covering Northern Trust, the consensus rating is a "Hold," with a mix of ratings including two "Strong Buy," one "Moderate Buy," ten "Holds," one "Moderate Sell," and three "Strong Sells" [6] - The ratings configuration has become more bullish over the past two months, with an increase in "Strong Buy" ratings from one to two [6]

Core Insights - Northern Trust has been appointed by Osmosis Investment Management NL B.V. to provide middle office support services including investment operations outsourcing, collateral management, and currency management [1][3] Company Overview - Osmosis NL is a sustainable fixed income asset manager based in the Netherlands, part of the Osmosis Group of Companies, which focuses on sustainability-driven investment solutions across equity and credit markets [2] - Northern Trust Corporation is a leading provider of wealth management, asset servicing, asset management, and banking services, with a global presence and significant assets under custody and management [4] Service Offerings - Northern Trust offers a comprehensive range of services including fund administration, global custody, investment operations outsourcing, and data solutions, catering to complex investment strategies across various asset classes [3] - The company provides automated currency management solutions through its Global Foreign Exchange business to support clients' distribution strategies [3] Strategic Collaboration - Clive Bellows, head of EMEA at Northern Trust, emphasized the importance of supporting Osmosis NL's growth and operational model refinement through their middle office infrastructure [3] - Albert Wisgerhof, COO and CFO of Osmosis NL, highlighted Northern Trust's flexibility, scale, and technology as key factors in their decision to partner for long-term growth [3]

Core Insights - Northern Trust employees dedicated a record-breaking 63,214 volunteer hours during the company's global month of service, Achieving Greater Together [1] - The initiative mobilized staff across 20 countries, supporting 1,500 nonprofit organizations and driving meaningful change on a global scale [1] - Throughout October, Northern Trust employees collaborated with local partners to address urgent community needs [1]

Core Viewpoint - Northern Trust is expanding its relationship with Avanda by providing fund administration and other services, building on a partnership that began in 2015 [1] Group 1 - Northern Trust will offer fund administration services to Avanda, indicating a strengthening of their existing partnership [1] - The collaboration between Northern Trust and Avanda has been ongoing since 2015, highlighting a long-term relationship in the asset management sector [1]

Financial Performance - For the three months ended September 30, 2025, net income was $457.6 million, a decrease of 2% compared to $464.9 million in the same period of 2024[8]. - Total revenue for the nine months ended September 30, 2025, was $5,963.3 million, down 6% from $6,330.8 million in 2024[8]. - Net Income for Q3 2025 decreased by 2% to $457.6 million compared to $464.9 million in Q3 2024[8]. - Net Income for the nine months ended September 30, 2025, was $1,270.9 million, down 19% from $1,575.7 million in the same period of 2024[95]. Revenue Breakdown - Noninterest income for the three months ended September 30, 2025, increased by 2% to $1,434.6 million, while for the nine months it decreased by 11% to $4,193.9 million[8]. - Revenue for the three months ended September 30, 2025, increased to $2.0 billion, with Trust, Investment and Other Servicing Fees rising to $1.3 billion due to favorable markets[18]. - Revenue for the nine months ended September 30, 2025, decreased to $6.0 billion, with Trust, Investment and Other Servicing Fees increasing to $3.7 billion driven by favorable markets and net new business[18]. - Total Noninterest Income for Q3 2025 was $1,434.6 million, an increase of 2% from $1,406.2 million in Q3 2024[94]. Assets and Deposits - Total assets as of September 30, 2025, were $170,263.3 million, reflecting a 9% increase from $155,508.4 million at the end of 2024[8]. - Deposits increased by 11% to $135,801.1 million as of September 30, 2025, compared to $122,482.7 million at the end of 2024[8]. - Total Assets Under Custody/Administration as of September 30, 2025, increased to $18,247.6 billion, reflecting a 5% increase year-over-year[30]. - Total Assets Under Management as of September 30, 2025, increased to $1,772.7 billion, representing a 9% increase compared to the prior-year quarter[34]. Interest Income and Expenses - Net interest income rose by 5% to $590.8 million for the three months ended September 30, 2025, and increased by 10% to $1,769.4 million for the nine months[8]. - Net Interest Income for Q3 2025 increased to $590.8 million, a 5% increase from $562.3 million in Q3 2024[8]. - Average Interest-Earning Assets totaled $139.34 billion in Q3 2025, with a net interest margin of 1.70%, compared to 1.68% in Q3 2024[50]. - The net interest margin on an FTE basis increased to 1.69% for the nine months ended September 30, 2025, compared to 1.62% in the prior-year period[60]. Credit Losses and Provisions - The provision for credit losses for the three months ended September 30, 2025, was $(17.0) million, compared to $8.0 million in the same period of 2024[8]. - The total provision for credit losses for the nine months ended September 30, 2025, was $0.5 million, significantly lower than the $7.5 million provision in the prior-year period[76]. - The company recorded a negative Provision for Credit Losses of $17.0 million in the current quarter, compared to a Provision for Credit Losses of $8.0 million in the prior-year quarter[18]. Taxation - The Provision for Income Taxes for the current quarter totaled $161.9 million, with an effective tax rate of 26.1%[18]. - The effective tax rate for the nine months ended September 30, 2025, was 25.5%, compared to 23.7% in the prior-year period[18]. Noninterest Expenses - Noninterest Expense for the current quarter increased to $1.4 billion, primarily due to higher Compensation and Equipment and Software expenses[18]. - Noninterest expense for the three months ended September 30, 2025, increased by 5% to $1,422.9 million, primarily due to a rise in compensation expenses by $41.7 million[79]. - The company reported a total noninterest expense of $4,257.1 million for the nine months ended September 30, 2025, which remained relatively stable compared to the prior-year period[79]. Market Performance and Shareholder Returns - The market value per share at the end of the period was $134.60, a significant increase of 50% from $90.03 at the end of 2024[8]. - Cash dividends declared per common share increased by 7% to $0.80 for the three months ended September 30, 2025[8]. - The S&P 500 index increased by 16% year-over-year, impacting the corporation's results positively[26]. Capital and Liquidity - Common Equity Tier 1 Capital ratio remained stable at 12.4% as of September 30, 2025, consistent with the ratio from December 31, 2024[148]. - The company’s Tier 1 Capital ratio was 13.4% as of September 30, 2025, compared to 13.3% as of December 31, 2024, indicating a slight improvement in capital adequacy[148]. - The company’s total assets at the end of the period were $170,263.3 million as of September 30, 2025, up from $155,508.4 million as of December 31, 2024, reflecting a growth of 9.4%[147]. Client Activity and Market Conditions - The company experienced increased client activity and higher liquidity due to market volatility, impacting deposit levels[55]. - The estimated impact on Net Interest Income (NII) for a 100 basis point increase in interest rates is $68 million for September 30, 2025, compared to $59 million for September 30, 2024[160].

Core Insights - The third quarter of 2025 saw positive market performance for U.S. institutional investors, with a median return of 4.3% in the Northern Trust Universe, driven by a Federal Reserve interest rate cut, advancements in artificial intelligence, and stabilization in tariff negotiations [1][18]. Performance Overview - The Northern Trust Universe tracks 363 large U.S. institutional investment plans with a combined asset value exceeding $1.4 trillion [2][3]. - Performance varied by plan type: - Northern Trust Corporate (ERISA) universe had a median return of 3.7% - Northern Trust Public Funds universe returned 4.0% - Northern Trust Foundation and Endowment (F&E) universe achieved a median return of 4.3% [4][10]. Equity Market Performance - U.S. equity markets performed strongly, with the S&P 500 gaining 8.1% in the third quarter and up 35% since April [5]. - The Northern Trust US Equity program universe posted a median return of 7.2%, while the Non-US Equity program universe had a median return of 6.1% [5]. Fixed Income Market Insights - Fixed income markets benefited from a 25 basis point rate cut by the Federal Reserve, which lowered treasury yields and narrowed credit spreads, enhancing bond prices [6]. - The Northern Trust US Fixed Income program universe returned 2.4% during the quarter [6]. Long-term Returns - ERISA plan median returns over one, three, and five years were 5.1%, 9.1%, and 4.1% respectively, with a 55% median allocation to U.S. fixed income [7]. - Public Funds median returns for the same periods were 9.6%, 11.9%, and 8.7%, with a 26% allocation to U.S. equity and 22% to U.S. fixed income [8]. - Foundations & Endowments reported median returns of 10.6%, 12.9%, and 9.8% over one, three, and five years, maintaining over 20% allocation to private equity [9].

Core Insights - Global markets showed positive results for U.S. institutional investors in Q3 2025, with a median return of 4.3% driven by a Federal Reserve interest rate cut, advancements in artificial intelligence, and stabilization of tariff negotiations [1][18]. Performance Overview - The Northern Trust Universe tracks 363 large U.S. institutional investment plans with a combined asset value exceeding $1.4 trillion [2][3]. - Performance varied by plan type: - Northern Trust Corporate (ERISA) universe returned 3.7% - Northern Trust Public Funds universe had a median return of 4.0% - Northern Trust Foundation and Endowment (F&E) universe produced a 4.3% median return [4][10]. Equity Market Performance - U.S. equity markets performed notably, with the S&P 500 gaining 8.1% in Q3 and up 35% since April [5]. - The Northern Trust US Equity program universe posted a 7.2% median return, while the Non-US Equity program universe had a median return of 6.1% [5]. Fixed Income Market Insights - Fixed income markets benefited from a 25 basis point rate cut by the Fed, which lowered treasury yields and narrowed credit spreads, enhancing bond prices [6]. - The Northern Trust US Fixed Income program universe returned 2.4% [6]. Long-term Returns - ERISA plan median returns for one, three, and five years were 5.1%, 9.1%, and 4.1% respectively, with a 55% allocation to U.S. fixed income [7]. - Public Funds universe median returns for the same periods were 9.6%, 11.9%, and 8.7%, with a 26% allocation to U.S. equity and 22% to U.S. fixed income [8]. - Foundations & Endowments universe median returns were 10.6%, 12.9%, and 9.8% for one, three, and five years, with over 20% allocated to private equity [9].

Core Insights - The median plan in the Northern Trust Canada Universe achieved a return of 3.6% for the quarter and 4.3% year-to-date as of September 30, 2025 [1] Summary by Category - **Performance Metrics** - The median plan returned 3.6% for the quarter [1] - Year-to-date return stands at 4.3% for the period ending September 30, 2025 [1]

Core Viewpoint - Northern Trust has benefited from buoyant financial markets, leading to solid fee income growth and margin expansion, resulting in a year-to-date return of approximately 25% for its shares [1]. Group 1: Financial Performance - The strong performance in financial markets has acted as a tailwind for Northern Trust, supporting its fee income growth [1]. - The company has experienced margin expansion, which is a positive indicator of its financial health [1]. Group 2: Investment Perspective - The company is viewed favorably for its ability to sustainably post high-quality earnings, appealing to long-term, buy-and-hold investors [1].

Core Viewpoint - Northern Trust has benefited from buoyant financial markets, leading to solid fee income growth and margin expansion, resulting in a year-to-date return of approximately 25% for its shares [1] Financial Performance - The company has experienced strong fee income growth due to favorable market conditions [1] - Margin expansion has also been a significant factor contributing to the overall financial performance [1] Investment Perspective - The company is viewed favorably for its ability to sustainably post high-quality earnings, particularly in the dividend and income sectors [1]