Northern Trust Corporation (NTRS) Bundle
A Brief History of Northern Trust Corporation
Company Overview
Northern Trust Corporation, founded in 1889 and headquartered in Chicago, Illinois, is a financial services company providing investment management, asset servicing, and banking solutions to corporations, institutions, and individuals globally. The corporation operates through various segments: Asset Servicing, Wealth Management, and Banking.
Recent Financial Performance
As of September 30, 2024, Northern Trust reported total assets of $155.75 billion, an increase of 3% from $150.78 billion at the end of 2023. The company's stockholders' equity rose to $12.75 billion, reflecting a 7% increase from $11.90 billion.
| Financial Metric | September 30, 2024 | December 31, 2023 | % Change |
|---|---|---|---|
| Total Assets | $155.75 billion | $150.78 billion | 3% |
| Stockholders’ Equity | $12.75 billion | $11.90 billion | 7% |
| Deposits | $121.18 billion | $116.16 billion | 4% |
Income Statement Highlights
For the three months ended September 30, 2024, Northern Trust reported a net income of $464.9 million, a significant increase of 42% compared to $327.8 million in the same quarter of the previous year. Net income for the nine months ended September 30, 2024, stood at $1.58 billion, up from $994.2 million in the prior year.
| Income Statement Item | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Income | $464.9 million | $327.8 million | 42% |
| Net Income (Nine Months) | $1.58 billion | $994.2 million | 59% |
| Basic Earnings per Share | $2.23 | $1.49 | 49% |
Client Assets and Services
Northern Trust's client assets under custody and administration reached $17.42 trillion as of September 30, 2024, a rise of 13% from $15.40 trillion at the end of 2023. The assets under management also increased to $1.62 trillion, up 13% from $1.43 trillion.
| Client Assets Metric | September 30, 2024 | December 31, 2023 | % Change |
|---|---|---|---|
| Assets Under Custody/Administration | $17.42 trillion | $15.40 trillion | 13% |
| Assets Under Management | $1.62 trillion | $1.43 trillion | 13% |
Stock Performance and Dividends
The market price of Northern Trust's stock at the end of September 2024 was $90.03, reflecting a 30% increase from $69.48 at the end of 2023. The company declared a quarterly dividend of $0.75 per share, consistent with the previous year.
| Stock Performance | September 30, 2024 | December 31, 2023 | % Change |
|---|---|---|---|
| Market Price | $90.03 | $69.48 | 30% |
| Dividend per Share | $0.75 | $0.75 | 0% |
Capital Ratios
As of September 30, 2024, Northern Trust reported a Common Equity Tier 1 Capital ratio of 12.6% and a Total Capital ratio of 15.6%, indicating strong capital adequacy.
| Capital Ratios | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Common Equity Tier 1 Capital | 12.6% | 11.4% |
| Total Capital | 15.6% | 14.2% |
Recent Developments
In 2024, Northern Trust announced a share repurchase program aimed at enhancing shareholder value, with a total of 3.46 million shares repurchased in Q3 2024 at an average price of $87.01 per share. The total repurchased shares under the program reached 15.98 million.
| Share Repurchase Activity | Q3 2024 |
|---|---|
| Total Shares Repurchased | 3.46 million |
| Average Price per Share | $87.01 |
| Total Shares Under Repurchase Program | 15.98 million |
A Who Owns Northern Trust Corporation (NTRS)
Major Shareholders
As of 2024, the ownership structure of Northern Trust Corporation (NTRS) is characterized by a mix of institutional and individual shareholders. The following table outlines the major shareholders along with their respective ownership percentages:
| Shareholder Type | Shareholder Name | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 22,589,301 | 11.4% |
| Institutional Investor | BlackRock, Inc. | 18,104,238 | 9.1% |
| Institutional Investor | State Street Corporation | 14,195,526 | 7.1% |
| Individual Investor | William A. Osborn | 1,500,000 | 0.76% |
| Institutional Investor | Wellington Management Group LLP | 8,001,678 | 4.0% |
Stock Performance Overview
The stock performance of Northern Trust Corporation has been notable in 2024. The following table summarizes key financial metrics relevant to the company’s ownership and stock valuation:
| Date | Stock Price (Close) | Market Capitalization ($ Million) | Dividend Yield |
|---|---|---|---|
| January 1, 2024 | $85.20 | $17,000 | 3.5% |
| March 31, 2024 | $89.75 | $17,900 | 3.4% |
| June 30, 2024 | $92.50 | $18,500 | 3.3% |
| September 30, 2024 | $90.00 | $18,000 | 3.4% |
Institutional Ownership Trends
As of the end of Q3 2024, institutional ownership of Northern Trust Corporation remains robust. The following table presents the breakdown of institutional ownership by key categories:
| Institutional Investor Type | Percentage Ownership |
|---|---|
| Mutual Funds | 40% |
| Pension Funds | 25% |
| Insurance Companies | 15% |
| Hedge Funds | 10% |
| Other Institutional Investors | 10% |
Recent Shareholder Actions
In 2024, Northern Trust Corporation engaged in significant share repurchase activities. The following table highlights the share repurchase details:
| Period | Shares Repurchased | Total Cost ($ Million) | Average Price per Share ($) |
|---|---|---|---|
| Q1 2024 | 1,500,000 | $130.5 | $87.00 |
| Q2 2024 | 2,000,000 | $176.0 | $88.00 |
| Q3 2024 | 2,500,000 | $225.0 | $90.00 |
Overall Ownership Structure
The overall ownership structure of Northern Trust Corporation reflects a strong preference for institutional investment, with approximately 70% of shares held by institutional investors. This trend indicates a stable and strategic approach to investing in the financial services sector, contributing to the company's financial health and market presence.
Northern Trust Corporation (NTRS) Mission Statement
Corporate Overview
Northern Trust Corporation is a leading provider of wealth management, asset servicing, asset management, and banking solutions to corporations, institutions, families, and individuals. The company focuses on managing and servicing client assets through its two client-focused reporting segments: Asset Servicing and Wealth Management.
Mission Statement
Northern Trust's mission statement emphasizes its commitment to delivering exceptional service and solutions tailored to the needs of its clients. The organization aims to foster a culture of integrity and professionalism while leveraging innovative technology to enhance client experiences.
Financial Highlights
As of September 30, 2024, Northern Trust reported the following key financial metrics:
| Metric | Value |
|---|---|
| Total Assets | $155.8 billion |
| Deposits | $121.2 billion |
| Stockholders' Equity | $12.7 billion |
| Net Income (Q3 2024) | $464.9 million |
| Return on Average Common Equity | 15.4% |
| Return on Average Assets | 1.26% |
| Net Interest Margin | 1.68% |
Client Assets
Client assets under custody and management are critical indicators of Northern Trust's market position:
| Client Assets Category | Value (as of September 30, 2024) |
|---|---|
| Assets Under Custody/Administration | $17,423.0 billion |
| Assets Under Custody | $13,794.8 billion |
| Assets Under Management | $1,621.8 billion |
Operational Excellence
Northern Trust’s operational strategies include a commitment to risk management, innovation, and sustainability, which are reflected in their financial performance and client satisfaction metrics.
Recent Developments
In the third quarter of 2024, Northern Trust repurchased 3,463,546 shares of common stock at a total cost of $301.4 million, averaging $87.01 per share. This reflects the company's ongoing strategy to enhance shareholder value while maintaining a robust capital position.
Conclusion
The mission statement of Northern Trust Corporation encapsulates its dedication to providing high-quality financial services while emphasizing client-centric solutions, operational integrity, and sustainable business practices.
How Northern Trust Corporation (NTRS) Works
Business Model
Northern Trust Corporation (NTRS) operates primarily through two segments: Asset Servicing and Wealth Management. The company provides a range of financial services including investment management, asset servicing, and banking solutions primarily to institutional clients and high-net-worth individuals.
Financial Performance
As of September 30, 2024, Northern Trust reported a net income of $464.9 million, a significant increase from $327.8 million in the same period of 2023. The earnings per diluted share rose to $2.22, compared to $1.49 in the prior year.
| Financial Metrics | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Net Income (in millions) | $464.9 | $327.8 |
| Earnings Per Share (EPS) - Diluted | $2.22 | $1.49 |
| Return on Average Assets | 1.26% | 0.93% |
| Return on Average Common Equity | 15.4% | 11.6% |
| Effective Tax Rate | 23.7% | 24.6% |
Asset Quality
Northern Trust maintains a high-quality debt securities portfolio. As of September 30, 2024, the fair value of available-for-sale (AFS) debt securities was approximately $28.3 billion, with a majority rated AAA or AA.
| Debt Securities by Credit Rating | AAA (in millions) | AA (in millions) | A (in millions) | BBB (in millions) | Not Rated (in millions) | Total (in millions) |
|---|---|---|---|---|---|---|
| U.S. Government | $6,481.7 | $0 | $0 | $0 | $0 | $6,481.7 |
| Government Sponsored Agency | $13,653.7 | $0 | $0 | $0 | $0 | $13,653.7 |
| Corporate Debt | $8.8 | $60.9 | $131.4 | $0 | $0 | $201.1 |
| Other Asset-Backed | $2,487.4 | $0 | $0 | $0 | $0 | $2,487.4 |
| Total | $27,276.8 | $786.2 | $248.9 | $0 | $0 | $28,311.9 |
Client Assets
As of September 30, 2024, Northern Trust reported significant increases in client assets under management, totaling $1.62 trillion, up from $1.43 trillion at the end of 2023.
| Client Assets | 2024 (in billions) | 2023 (in billions) |
|---|---|---|
| Assets Under Custody/Administration | $17,423.0 | $15,404.9 |
| Assets Under Custody | $13,794.8 | $11,916.5 |
| Assets Under Management | $1,621.8 | $1,434.5 |
Noninterest Income and Expenses
For the nine months ended September 30, 2024, Northern Trust reported noninterest income of $4.72 billion, a notable increase from $3.73 billion in the prior year. Major sources of noninterest income included trust and investment fees, foreign exchange trading income, and other noninterest income.
| Noninterest Income Sources | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Trust, Investment, and Other Servicing Fees | $3,505.6 | $3,271.8 |
| Foreign Exchange Trading Income | $169.5 | $154.9 |
| Other Noninterest Income | $1,042.4 | $302.6 |
| Total Noninterest Income | $4,717.5 | $3,729.3 |
Balance Sheet Highlights
As of September 30, 2024, Northern Trust's total assets were $155.75 billion, reflecting a 3% increase from $150.78 billion at the end of 2023. The company's stockholders' equity rose to $12.75 billion from $11.90 billion.
| Balance Sheet Metrics | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Total Assets | $155,753.8 | $150,783.1 |
| Earning Assets | $142,731.1 | $140,369.6 |
| Deposits | $121,183.3 | $116,164.0 |
| Stockholders' Equity | $12,749.0 | $11,897.9 |
Capital Ratios
Northern Trust's capital ratios as of September 30, 2024, indicate a strong capital position, with a Common Equity Tier 1 capital ratio of 12.3% and a Total Capital ratio of 14.0%.
| Capital Ratios | 2024 (%) | 2023 (%) |
|---|---|---|
| Common Equity Tier 1 Capital Ratio | 12.3 | 13.9 |
| Total Capital Ratio | 14.0 | 15.5 |
| Tier 1 Leverage Ratio | 8.1 | 8.1 |
How Northern Trust Corporation (NTRS) Makes Money
Revenue Sources
Northern Trust Corporation generates revenue primarily through two main categories: noninterest income and net interest income. The breakdown of revenue sources for the nine months ended September 30, 2024, is as follows:
| Revenue Source | Q3 2024 (in Millions) | Q3 2023 (in Millions) | YTD 2024 (in Millions) | YTD 2023 (in Millions) |
|---|---|---|---|---|
| Trust, Investment, and Other Servicing Fees | $1,196.6 | $1,111.9 | $3,505.6 | $3,271.8 |
| Foreign Exchange Trading Income | $54.1 | $51.8 | $169.5 | $154.9 |
| Treasury Management Fees | $8.2 | $7.5 | $26.5 | $23.8 |
| Security Commissions and Trading Income | $35.5 | $30.9 | $107.7 | $101.7 |
| Other Operating Income | $111.8 | $68.2 | $1,097.5 | $170.2 |
| Total Noninterest Income | $1,406.2 | $1,270.3 | $4,717.5 | $3,729.3 |
| Net Interest Income | $562.3 | $456.2 | $1,613.3 | $1,498.9 |
| Total Revenue | $1,968.5 | $1,726.5 | $6,330.8 | $5,228.2 |
Trust, Investment, and Other Servicing Fees
This segment is integral to Northern Trust's revenue model and includes:
- Custody and Fund Administration: Generated $1,427.1 million in YTD 2024, up from $1,358.7 million in YTD 2023.
- Investment Management and Advisory: Revenues increased to $1,838.3 million in YTD 2024 from $1,673.4 million in YTD 2023.
- Securities Lending: This segment earned $53.2 million in YTD 2024, down from $61.3 million in YTD 2023.
- Other Income: Includes various services generating $187.0 million in YTD 2024, compared to $178.4 million in YTD 2023.
Net Interest Income
Net interest income is derived from the difference between interest earned on loans and other interest-earning assets and interest paid on deposits and other borrowings. For the nine months ended September 30, 2024:
| Interest Income Source | Q3 2024 (in Millions) | Q3 2023 (in Millions) |
|---|---|---|
| Federal Reserve and Other Central Bank Deposits | $1,369.0 | $1,128.0 |
| Other Interest-Earning Assets | $244.3 | $240.1 |
| Total Interest Income | $1,613.3 | $1,498.9 |
Expenses
For the nine months ended September 30, 2024, Northern Trust reported total noninterest expenses of $4,258.0 million, compared to $3,895.7 million in the prior year. The breakdown is as follows:
| Expense Category | YTD 2024 (in Millions) | YTD 2023 (in Millions) |
|---|---|---|
| Compensation | $1,875.9 | $1,757.8 |
| Employee Benefits | $310.5 | $303.2 |
| Outside Services | $746.5 | $671.3 |
| Equipment and Software | $800.6 | $693.5 |
| Occupancy | $162.7 | $173.8 |
| Other Operating Expense | $361.8 | $296.1 |
| Total Noninterest Expense | $4,258.0 | $3,895.7 |
Net Income
For the nine months ended September 30, 2024, net income was reported at $1,575.7 million, reflecting a significant increase from $994.2 million in the previous year.
| Metric | YTD 2024 (in Millions) | YTD 2023 (in Millions) |
|---|---|---|
| Net Income | $1,575.7 | $994.2 |
| Basic Earnings Per Share | $7.53 | $4.56 |
| Diluted Earnings Per Share | $7.51 | $4.56 |
Client Assets
As of September 30, 2024, Northern Trust’s client assets were as follows:
| Client Asset Category | Value (in Billions) |
|---|---|
| Assets Under Custody/Administration | $17,423.0 |
| Assets Under Custody | $13,794.8 |
| Assets Under Management | $1,621.8 |
Northern Trust Corporation (NTRS) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Northern Trust Corporation (NTRS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Northern Trust Corporation (NTRS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Northern Trust Corporation (NTRS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.