Financial Data and Key Metrics Changes - The company reported third quarter net income of $458 million and earnings per share of $2.29, with a return on average common equity of 14.8% [17] - Revenue increased by 6% year-over-year, while expenses rose by 4.7%, resulting in a pre-tax margin expansion of 200 basis points [19][25] - Year-to-date, the company returned 110% of earnings to shareholders, contributing to a 5% decrease in shares outstanding [5][25] Business Line Data and Key Metrics Changes - **Wealth Management**: Assets under management increased to $493 billion, up 11% year-over-year, with trust investment and other servicing fees rising 5% [20] - **Asset Management**: The business launched 11 new ETF strategies, with liquidity remaining strong, reporting its 11th consecutive quarter of positive flows [11][22] - **Asset Servicing**: Assets under custody and administration reached $17 trillion, reflecting a 4% year-over-year increase, with asset servicing fees totaling $707 million, up 6% [21][22] Market Data and Key Metrics Changes - The company experienced a 1% sequential increase in assets under custody and administration, and a 5% year-over-year increase [18] - The effective tax rate was 26.1%, up 70 basis points from the prior period due to higher tax impacts from international operations [19] Company Strategy and Development Direction - The company is focused on its "One Northern Trust" strategy, emphasizing organic growth and operational efficiency, particularly through AI integration across various business lines [5][8] - The Enterprise Growth Program is enhancing organic growth, especially in private markets, with a client-centric operating model yielding productivity gains [6][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong financial performance despite potential economic fluctuations, emphasizing a disciplined execution of strategy [15][16] - The company anticipates continued growth in net interest income and expects operating expense growth to remain below 5% for the full year [26] Other Important Information - The company has embedded AI in over 150 use cases, significantly improving efficiency and client service [7][8] - The company is exploring opportunities in digital assets and tokenization, focusing on enhancing its capabilities in these areas [79] Q&A Session Summary Question: NII outlook and deposit trends - Management indicated that deposits performed in line with expectations and projected a slight increase in Q4 deposits, with NII expected to grow mid to high single digits [31][32] Question: Challenges at the investment product level - Management noted pressure on index products due to asset allocation and pricing, and emphasized a focus on improving product performance and expanding alternative offerings [34][35] Question: AUCA growth and outflows - Management explained that AUCA growth was driven by specific clients, and outflows were due to restructuring rather than client losses [40][41] Question: Expense growth and operating leverage - Management reaffirmed commitment to keeping expense growth below 5% and highlighted ongoing efforts to improve operational efficiency [42][44] Question: AI's impact across business lines - Management stated that AI is enhancing efficiency across all areas, with specific applications in operations, technology, and client service [75][76] Question: Digital assets and stablecoin strategy - Management discussed the importance of innovation and regulation in the digital asset space, indicating a focus on tokenization rather than issuing a stablecoin [79][80]