01—Abstract
Summary
Summary of the 8-K filed April 22, 2025. Cited figures are marked; the original filing is the authoritative source.
Northern Trust Corporation reported first-quarter 2025 net income of $392.0 milliona, or $1.90 per diluted common share, compared with $2.26 per diluted share in the fourth quarter of 2024 and $0.96 in the first quarter of 2024.
Net income was $455.4 millionb in the prior quarter and $214.7 million in the prior-year quarter. Management cited the third consecutive quarter of positive operating leverage, with mid-single-digit growth in trust fees and net interest income year over year, and EPS excluding prior-year notables up 13%. Return on average common equity was 13.0%, and the company returned $435.4 million to common shareholders through dividends and share repurchases.
Total revenue (FTE) was $1,945.6 millionc, down 1% sequentially and up 18% from the prior-year quarter. Trust, investment and other servicing fees were $1,213.8 million, and net interest income (FTE) was $573.7 million. Noninterest expense rose 3% sequentially to $1,417.6 million, driven by compensation tied to equity awards granted to retirement-eligible employees.
Total assets under custody/administration reached $16.92 trilliond and assets under management reached $1.61 trillion at March 31, 2025. Client asset figures for the quarter are preliminary until the Form 10-Q is filed. Capital ratios remained strong, with the Corporation's Common Equity Tier 1 ratio at 12.9% under the standardized approach and 15.3% under the advanced approach at March 31, 2025, both above well-capitalized requirements.
The filing also reports net unrealized after-tax losses on available-for-sale securities of $527.1 million at quarter-end. The information is furnished under Items 2.02 and 7.01 and is not deemed filed for Section 18 purposes.
02—Key points
Key Highlights
- Net income of $392.0 million and diluted EPS of $1.90 in Q1 2025, down from $2.26 in Q4 2024 but up from $0.96 in Q1 2024
- Total revenue (FTE) of $1,945.6 million, down 1% sequentially and up 18% year over year
- Trust, investment and other servicing fees of $1,213.8 million, up 6% year over year; Asset Servicing fees up 5% and Wealth Management fees up 8%
- Noninterest expense of $1,417.6 million, up 3% sequentially, driven by compensation tied to equity awards for retirement-eligible employees
- Assets under custody/administration of $16.92 trillion and assets under management of $1.61 trillion at March 31, 2025
- Return on average common equity of 13.0%; $435.4 million returned to shareholders via dividends and buybacks, including 2,616,238 shares repurchased at $109.79 average price
- Common Equity Tier 1 capital ratio of 12.9% (standardized) and 15.3% (advanced) at March 31, 2025, with the company described as well-capitalized
03—Questions
Frequently Asked Questions
How did Northern Trust perform in the first quarter of 2025?
Net income was $392.0 million, or $1.90 per diluted share, compared with $455.4 million and $2.26 per diluted share in the fourth quarter of 2024. Year over year, net income rose from $214.7 million, when results included a $189.4 million investment security loss and a $12.5 million FDIC special assessment. Management said EPS excluding prior-year notables increased 13%.
What drove revenue and expense trends this quarter?
Total revenue (FTE) was $1,945.6 million, down 1% sequentially but up 18% from the prior-year quarter, where a $189.4 million securities loss weighed on results. Trust fees were $1,213.8 million. Noninterest expense rose 3% sequentially to $1,417.6 million, mainly due to compensation from equity incentive awards granted to retirement-eligible employees.
How did client assets change?
Assets under custody/administration were $16,924.0 billion, up 1% from December 31, 2024 and up 3% from March 31, 2024. Assets under management were $1,607.8 billion, essentially flat sequentially and up 7% year over year. The filing notes these client assets are preliminary until the Form 10-Q is filed.
How much capital did Northern Trust return and how strong is its capital position?
The company returned $435.4 million to common shareholders through dividends and repurchases in the quarter, including $148.2 million in common dividends and $287.2 million in share repurchases. It also declared $16.2 million in preferred dividends. Capital ratios exceeded well-capitalized requirements at March 31, 2025, with Common Equity Tier 1 at 12.9% (standardized) and 15.3% (advanced).
04—Continue