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Northern Trust Annual Report, Year Ended Dec 31, 2000

Filing Date
Filed March 16, 2001
Period End
December 31, 2000
Securities
NTRSNTRSO
In the record · 2016–202610-K1110-Q338-K118

NTRS filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 118 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Feb ’19Feb ’19
  2. FY2020 annual report10-K · Feb ’21Feb ’21
  3. Leadership change8-K · Sep ’25Sep ’25

01—Abstract

Summary

Summary of the 10-K filed March 16, 2001. Cited figures are marked; the original filing is the authoritative source.

Northern Trust Corporation, a Delaware bank holding company headquartered in Chicago, reported record 2000 results in this 10-K.

At December 31, 2000, consolidated total assets were approximately $36.0 billiona and stockholders' equity was approximately $2.5 billion. Net income for 2000 was a record $485.1 million, compared with $405.0 million in 1999 and $353.9 million in 1998, and diluted net income per common share rose to $2.08 from $1.74. Trust fees reached $1,201.2 million, and trust assets under administration totaled $1.68 trillion at year-end.

The filing states that 2000 marked the thirteenth consecutive year of record earnings. The Corporation's business is organized around Corporate and Institutional Services (C&IS), Personal Financial Services (PFS), Northern Trust Global Investments (NTGI) and Worldwide Operations and Technology (WWOT). Net income was $249.4 millionb for C&IS and $268.4 million for PFS in 2000.

Net interest income rose to $568.6 million, while noninterest expenses increased to $1,351.5 millionc, and the productivity ratio reached 160%, an all-time high stated in the filing. Net interest margin declined to 2.02% from 2.05%, which the filing attributes primarily to growth in low-spread federal agency securities. Credit quality and capital remained strong by the filing's measures.

Nonaccrual loans were $76.3 milliond, or .42% of the $18.1 billion loan portfolio, and the reserve for credit losses was $162.9 million, or .90% of year-end loans. Tier 1 capital was 9.8% and total capital was 12.9% of risk-weighted assets, both well above regulatory minimums.

The Board increased the quarterly dividend 14.8% to $.155 per share in November 2000. The filing also notes that the Corporation completed the adoption of SFAS No. 133 on January 1, 2001, with an immaterial effect on earnings.

02—Key points

Key Highlights

  1. Record 2000 net income of $485.1 million, up from $405.0 million in 1999; diluted EPS of $2.08 versus $1.74.
  2. Trust fees rose to $1,201.2 million from $974.2 million; trust assets under administration reached $1.68 trillion at December 31, 2000.
  3. Total assets of approximately $36.0 billion and stockholders' equity of $2.46 billion at year-end 2000.
  4. Net interest margin fell to 2.02% from 2.05%, attributed mainly to growth in low-spread federal agency securities.
  5. Nonaccrual loans were $76.3 million (.42% of loans); reserve for credit losses was $162.9 million (.90% of year-end loans).
  6. Tier 1 capital ratio of 9.8% and total capital ratio of 12.9% of risk-weighted assets, well above regulatory minimums.
  7. Quarterly dividend increased 14.8% to $.155 per share in November 2000, the fourteenth consecutive annual increase.

03—Questions

Frequently Asked Questions

  1. How profitable was Northern Trust in 2000?

    Net income for 2000 was a record $485.1 million, a 20% increase from $405.0 million in 1999, and diluted net income per common share was $2.08 versus $1.74. The filing reports a return on average common equity of 22.09% and a return on average assets of 1.43%.

  2. What drove the growth in revenue?

    Trust fees were the main driver, rising to $1,201.2 million from $974.2 million in 1999. Foreign exchange trading profits rose to $152.7 million from $107.7 million, and net interest income increased to $568.6 million from $518.8 million.

  3. Are there any signs of credit stress in the loan book?

    Nonaccrual loans rose to $76.3 million from $59.3 million, and the provision for credit losses was $24.0 million versus $12.5 million in 1999. Management states that the overall quality of the loan portfolio remains strong.

  4. How strong is the company's capital position?

    At December 31, 2000, Tier 1 capital was 9.8% and total capital was 12.9% of risk-weighted assets, and the leverage ratio was 6.9%. The filing states that all capital ratios were well above the levels required to be classified as well capitalized.

  5. What are the main business units and how do they perform?

    Corporate and Institutional Services earned $249.4 million in net income in 2000, up 28%, and Personal Financial Services earned $268.4 million, up 18%. Treasury and Other recorded a net loss of $32.7 million. Trust assets under administration were $1.68 trillion in total, including $338.0 billion under management.

04—Continue

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