01—Abstract
Summary
Summary of the 10-K filed February 24, 2025. Cited figures are marked; the original filing is the authoritative source.
Northern Trust Corporation reported net income of $2.03 billiona for 2024, up from $1.11 billion in 2023, on total revenue of $8.29 billion, up from $6.77 billion.
The increase was driven primarily by Other Operating Income of $1.16 billionb, which included a $896.7 million gain tied to the Visa exchange offer and a $68.1 million gain on the sale of an equity investment. Trust, Investment and Other Servicing Fees rose to $4.73 billion, primarily due to favorable markets and net new business. Net interest income increased to $2.18 billion, and the net interest margin on an FTE basis rose to 1.64% from 1.56%.
Noninterest expense increased to $5.63 billionc, reflecting higher compensation, equipment and software, and outside services costs. Assets under custody/administration reached $16.79 trillion and assets under management reached $1.61 trillion at December 31, 2024, both up from the prior year, reflecting favorable markets and asset inflows. Total assets were $155.5 billion and stockholders' equity was $12.8 billion.
The Corporation returned capital through common dividends of $608.4 milliond and share repurchases of $937.8 million in 2024. Its Common Equity Tier 1 capital ratio under the standardized approach was 12.4%, and the Corporation was classified as a Category II institution.
The filing also notes ongoing regulatory uncertainty, including the proposed Basel III Endgame rule and a proposed long-term debt requirement, both of which are not yet finalized. Management identifies the company's reliance on fee-based business, interest rate sensitivity, and cybersecurity and operational risks as key risk areas.
02—Key points
Key Highlights
- Net income of $2.03 billion in 2024, up 83% from $1.11 billion in 2023; diluted EPS of $9.77 versus $5.08.
- Total revenue of $8.29 billion, up 22%, with noninterest income of $6.11 billion representing 74% of total revenue.
- Other Operating Income of $1.16 billion, including a $896.7 million gain from participation in a Visa exchange offer and a $68.1 million gain on sale of an equity investment.
- Trust, Investment and Other Servicing Fees of $4.73 billion, up 8%, driven by favorable markets and net new business.
- Assets under custody/administration of $16.79 trillion and assets under management of $1.61 trillion at year-end 2024, both increasing from 2023.
- Net interest margin on an FTE basis increased to 1.64% from 1.56%, and net interest income rose to $2.18 billion.
- Capital returned to common stockholders totaled $1.5 billion, including $937.8 million of share repurchases; Common Equity Tier 1 ratio (standardized) was 12.4%.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 24, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $8.29B$6.77B | +22.4% |
| Net Income | $2.03B$1.11B | +83.4% |
| EPS (Basic) | $9.80$5.09 | +92.5% |
| EPS (Diluted) | $9.77$5.08 | +92.3% |
| Shares Outstanding (Basic) | 201.26M207.25M | −2.9% |
| Shares Outstanding (Diluted) | 201.87M207.56M | −2.7% |
05—Questions
Frequently Asked Questions
What drove the large increase in 2024 net income?
Net income rose to $2.03 billion from $1.11 billion, primarily because Other Operating Income increased by $928.7 million to $1.16 billion. That increase was mainly due to a $896.7 million gain related to Northern Trust's participation in a Visa exchange offer and a $68.1 million gain on the sale of an equity investment. Trust, Investment and Other Servicing Fees also grew by $366.0 million, or 8%.
How did core fee-based business perform?
Trust, Investment and Other Servicing Fees rose to $4.73 billion from $4.36 billion, with Asset Servicing fees up 7% and Wealth Management fees up 10%. The filing attributes the growth primarily to favorable markets and net new business. Custody and Fund Administration fees and Investment Management fees both increased.
What were the key expense trends?
Noninterest expense rose to $5.63 billion from $5.28 billion. The increase was driven by Compensation ($2.47 billion, up from $2.32 billion, including $81.8 million of severance-related charges), Equipment and Software ($1.08 billion), and Outside Services ($998.0 million). Other Operating Expense declined, mainly because of prior-year FDIC special assessments, partly offset by a $70.0 million charitable contribution in 2024.
How strong is the Corporation's capital position?
At December 31, 2024, the Corporation's Common Equity Tier 1 ratio was 12.4% under the standardized approach and 14.5% under the advanced approach, and its Tier 1 leverage ratio was 8.1%. The filing states that the capital ratios exceeded the requirements for classification as well-capitalized. Stockholders' equity was $12.8 billion, and total assets were $155.5 billion.
What regulatory developments could affect Northern Trust going forward?
The filing describes the proposed Basel III Endgame rule, which would introduce a new expanded risk-based approach for calculating risk-weighted assets. It also describes a proposed long-term debt and clean holding company requirement. The filing states that the timing and form of final rules remain uncertain and that the potential impacts cannot be determined until final rules are published.
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