v3.25.2
Reporting Segments
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
Reporting Segments Reporting Segments
Northern Trust is organized around its two client-focused reporting segments: Asset Servicing and Wealth Management. Asset management and related services are provided to Asset Servicing and Wealth Management clients primarily by the Asset Management business. The revenue and expenses of Asset Management and certain other support functions are allocated fully to Asset Servicing and Wealth Management.
Reporting segment financial information, presented on an internal management-reporting basis, is determined by accounting systems used to allocate revenue and expense to each segment, and incorporates processes for allocating assets, liabilities, equity and the applicable interest income and expense utilizing an FTP methodology. Under the methodology, assets and liabilities receive a funding charge or credit that considers interest rate risk, liquidity risk, and other product characteristics on an instrument level. Additionally, segment information is presented on an FTE basis as management believes an FTE presentation provides a clearer indication of net interest income. The adjustment to an FTE basis has no impact on Net Income.
Revenues, expenses and average assets are allocated to Asset Servicing and Wealth Management, with the exception of non-recurring activities such as certain corporate transactions and costs incurred associated with acquisitions, divestitures, litigation, restructuring, and tax adjustments not directly attributable to a specific reporting segment, which are reported within Other.
In addition to income and expenses associated with non-recurring activities, Other includes expenses for Asset Management, corporate and other support functions not directly incurred by, but ultimately allocated back to Asset Servicing and Wealth Management. Other also includes the FTE adjustments of $4.7 million and $10.3 million for the three and six months ended June 30, 2025 respectively, and $6.9 million and $14.2 million for the three and six months ended June 30, 2024, respectively, in order to reconcile the segment results that are reported on an internal management-reporting basis into consolidated results.
Reporting segment results are subject to reclassification when organizational changes are made. The results are also subject to refinements in revenue and expense allocation methodologies, which are typically reflected on a retrospective basis unless it is impractical to do so.
Effective January 2025, certain operations support activities were moved out of Asset Servicing and Wealth Management in connection with the formation of the Enterprise Chief Operating Office. The Enterprise Chief Operating Office provides operational support to Asset Servicing and Wealth Management. Its expenses are included within Other and are fully allocated to Asset Servicing and Wealth Management. Prior-year segment results have been recast, where practical, to reflect the organizational changes.
Northern Trust’s Chief Operating Decision Maker is the Chief Executive Officer. The Chief Operating Decision Maker uses growth and profitability metrics to assess segments’ performance including segment revenue and income before income taxes. Those same measures are used by the Chief Operating Decision Maker as primary inputs into the allocation of resources in the annual planning process. Allocation of capital to each segment takes into consideration a variety of factors including average loans, average deposits and applicable regulatory capital requirements.
The following table presents the earnings contributions and certain average balances of Northern Trust’s reporting segments for the three- and six-month periods ended June 30, 2025 and 2024.
TABLE 58: RESULTS OF REPORTING SEGMENTS
($ In Millions)
ASSET SERVICING(3)
WEALTH MANAGEMENT(3)
OTHER(4)
TOTAL CONSOLIDATED
THREE MONTHS ENDED JUNE 30,20252024202520242025202420252024
Noninterest Income
Trust, Investment and Other Servicing Fees$691.8 $650.6$539.3 $515.5$— $—$1,231.1$1,166.1
Foreign Exchange Trading Income (Loss)61.0 62.2(10.4)(3.8)— —50.658.4
Other Noninterest Income70.6 59.434.6 30.00.5 878.7105.7968.1
Total Noninterest Income823.4 772.2563.5 541.70.5 878.71,387.42,192.6
Net Interest Income (Expense)(1)
347.2 282.7268.3 244.3(5.0)(4.1)610.5522.9
Revenue(1)
1,170.6 1,054.9831.8 786.0(4.5)874.61,997.92,715.5
Provision for Credit Losses3.9 4.511.2 5.01.4 (1.5)16.58.0
Noninterest Expense
Compensation75.2 132.4142.2 155.2397.4 377.6614.8665.2
Employee Benefits16.4 17.222.9 20.678.4 62.4117.7100.2
Outside Services43.9 52.417.0 12.6186.1 195.9247.0260.9
Allocated Expense740.7 689.2305.0 307.8(1,045.7)(997.0)——
Other Segment Items(2)
19.4 23.623.9 22.1393.8 461.9437.1507.6
Total Noninterest Expense895.6 914.8511.0 518.310.0 100.81,416.61,533.9
Income (Loss) before Income Taxes(1)
271.1 135.6309.6 262.7(15.9)775.3564.81,173.6
Provision for Income Taxes(1)
58.1 29.275.6 66.39.8 182.0143.5277.5
Net Income (Loss)$213.0 $106.4$234.0 $196.4$(25.7)$593.3$421.3$896.1
Percentage of Consolidated Net Income51 %12 %56 %22 %(7)%66 %100 %100 %
Average Assets$117,044.6 $108,290.3 $39,094.5 $38,828.7$1,580.1 $882.2$157,719.2$148,001.2
Average Loans$5,812.8$6,472.3$35,345.2 $34,562.3$— $—$41,158.0$41,034.6
Average Deposits$95,506.7$86,223.0$25,291.0 $26,236.4$1,580.1$882.2$122,377.8$113,341.6
(1) Financial measures stated on an FTE basis.
(2) Other Segment Items include Occupancy, Equipment & Software and Other Operating Expense.
(3) Prior-year quarter items including severance-related charges, software amortization acceleration and dispositions, and a securities repositioning related to the supplemental pension plan, are allocated to the Reporting Segments based on the nature of the item.
(4) Includes the net gain from Northern Trust’s participation in the Visa Exchange Offer in the prior-year quarter.
(In Millions)
ASSET SERVICING(3)
WEALTH MANAGEMENT(3)
OTHER(4)
TOTAL CONSOLIDATED
SIX MONTHS ENDED JUNE 30,20252024202520242025202420252024
Noninterest Income
Trust, Investment and Other Servicing Fees$1,363.7 $1,290.2$1,081.2 $1,018.8$— $—$2,444.9 $2,309.0
Foreign Exchange Trading Income (Loss)124.9 122.1(15.6)(6.7)— —109.3 115.4
Other Noninterest Income (Loss)139.2 130.168.1 68.5(2.2)688.3205.1 886.9
Total Noninterest Income (Loss)1,627.8 1,542.41,133.7 1,080.6(2.2)688.32,759.3 3,311.3
Net Interest Income(1)
670.9 575.3518.4 485.7(10.7)(10.0)1,178.6 1,051.0
Revenue(1)
2,298.7 2,117.71,652.1 1,566.3(12.9)678.33,937.9 4,362.3
Provision for Credit Losses6.0 (1.3)10.3 3.31.2 (2.5)17.5 (0.5)
Noninterest Expense
Compensation169.5 228.1293.3 299.9796.4 764.31,259.2 1,292.3
Employee Benefits33.8 34.345.0 41.1148.6 125.9227.4 201.3
Outside Services90.8 101.931.3 22.5370.1 365.8492.2 490.2
Allocated Expense1,450.3 1,355.0611.9 603.9(2,062.2)(1,958.9)— —
Other Segment Items(2)
41.8 44.846.4 40.4767.2 829.6855.4 914.8
Total Noninterest Expense1,786.2 1,764.11,027.9 1,007.820.1 126.72,834.2 2,898.6
Income before Income Taxes(1)
506.5 354.9613.9 555.2(34.2)554.11,086.2 1,464.2
Provision for Income Taxes(1)
108.9 77.7150.1 139.913.9 135.8272.9 353.4
Net Income$397.6 $277.2$463.8 $415.3$(48.1)$418.3$813.3 $1,110.8
Percentage of Consolidated Net Income49 %25 %57 %37 %(6)%38 %100 %100 %
Average Assets$113,432.9 $107,563.3$39,121.2 $38,502.4$1,457.2 $494.1$154,011.3 $146,559.8
Average Loans$5,781.2$6,690.9$35,336.2 $34,619.8$— $—$41,117.4 $41,310.7
Average Deposits$92,418.8$86,455.9$25,290.3 $25,902.2$1,457.2 $494.1$119,166.3 $112,852.2
(1) Financial measures stated on an FTE basis.
(2) Other Segment Items include Occupancy, Equipment & Software and Other Operating Expense.
(3) Prior-year period items including severance-related charges, software amortization acceleration and dispositions, and a securities repositioning related to the supplemental pension plan, are allocated to the Reporting Segments based on the nature of the item.
(4) Includes the net gain from Northern Trust’s participation in the Visa Exchange Offer, partially offset by a loss on available for sale debt securities sold in conjunction with a repositioning of the portfolio, both in the prior-year period.