Core Insights - Northern Trust Corporation (NTRS) reported third-quarter 2025 earnings per share (EPS) of $2.29, exceeding the Zacks Consensus Estimate of $2.26 and up from $2.22 in the prior-year quarter [1][9] - The results were supported by an increase in net interest income (NII), total assets under custody (AUC), and assets under management (AUM), although elevated expenses and a decline in other fee income raised concerns [1][11] Financial Performance - Net income on a GAAP basis was $457.6 million, reflecting a 1.6% decrease from the prior-year quarter [2] - Total revenues on a GAAP basis reached $2.02 billion, marking a 2.8% year-over-year increase, but fell short of the Zacks Consensus Estimate by nearly 1% [3] - NII on a fully taxable equivalent basis was $596.3 million, up 4.7% year over year, with a net interest margin of 1.70%, an increase of 2 basis points from the prior-year quarter [3] - Trust, investment, and other servicing fees totaled $1.26 billion, up 5.7% year over year [3] Expenses and Income - Other non-interest income decreased by 19.3% to $169.1 million compared to the year-ago quarter, primarily due to a drop in other operating income [4] - Non-interest expenses rose 4.7% year over year to $1.42 billion, driven by increases across all components except for outside services and other operating expenses [4] AUC and AUM - As of September 30, 2025, total AUC increased by 4.7% year over year to $14.4 trillion, while total AUM rose by 9.3% year over year to $1.8 trillion [5] Credit Quality - The total allowance for credit losses was $206.7 million, down 6% year over year [6] - Total non-accrual assets increased to $78.8 million from $73.1 million in the year-ago period [6] - NTRS reported provision benefits of $17 million in the third quarter, compared to a provision for credit losses of $8 million in the year-ago quarter [6] Capital and Profitability Ratios - As of September 30, 2025, the Common Equity Tier 1 capital ratio was 12.4%, down from 12.6% in the prior-year quarter [7] - The total capital ratio decreased to 15.1% from 15.6% in the year-ago quarter, and the Tier 1 leverage ratio was 8.0%, down from 8.1% [7] - The return on average common equity was 14.8%, compared to 15.4% in the prior-year quarter [7] Capital Distribution - In the reported quarter, Northern Trust returned $431.3 million to shareholders through share repurchases and dividends [10]

Core Viewpoint - Northern Trust Corporation (NTRS) reported second-quarter 2025 adjusted earnings per share (EPS) of $2.13, surpassing the Zacks Consensus Estimate of $2.08, but down from $4.34 in the prior-year quarter. The results were supported by an increase in net interest income (NII) and growth in total assets under custody (AUC) and assets under management (AUM), although elevated expenses, reduced other fee income, and weak asset quality raised concerns [1][9]. Financial Performance - Net income on a GAAP basis was $421.3 million, reflecting a 53% decline from the prior-year quarter [2]. - Quarterly total revenues on a GAAP basis were $1.99 billion, down 26.4% year over year, but exceeded the Zacks Consensus Estimate by 1% [3]. - NII on a fully taxable equivalent basis was $615.2 million, marking a 16.1% increase year over year, with a net interest margin of 1.69%, up 12 basis points from the prior-year quarter [3]. - Trust, investment, and other servicing fees totaled $1.23 billion, up 5.6% year over year [3]. Income and Expenses - Other non-interest income decreased by 84.7% to $156.3 million compared to the year-ago quarter, primarily due to a decline in foreign exchange trading income and other operating income [4]. - Non-interest expenses fell 7.6% year over year to $1.42 billion, driven by reductions in compensation, outside services, occupancy, and other operating expenses [4]. Asset Management - As of June 30, 2025, Northern Trust's total AUC increased by 9.2% year over year to $14.2 trillion, while total AUM rose by 11.2% year over year to $1.7 trillion [5]. Credit Quality - The total allowance for credit losses was $224.1 million, up 6.9% year over year. Total non-accrual assets increased to $92.8 million from $38.5 million in the year-ago period, with provisions for credit losses reported at $16.5 million compared to $8 million in the prior-year quarter [6]. Capital and Profitability - As of June 30, 2025, the Common Equity Tier 1 capital ratio was 12.2%, down from 12.6% in the prior-year quarter. The total capital ratio was 14.8%, down from 15.5% in the year-ago quarter, and the Tier 1 leverage ratio was 7.6%, down from 8% [7]. - The return on average common equity was 14.2%, compared to 31.2% in the year-earlier quarter [7]. Capital Distribution - In the reported quarter, Northern Trust returned $485.6 million to shareholders through share repurchases and dividends [10].