Northern Trust (NTRS) Goldman Sachs 2024 U.S. Financial Services Conference summary

Strategic initiatives and leadership changes

• Launched the One Northern Trust strategy focused on optimizing growth, strengthening resiliency, and driving productivity.

• Appointed new presidents for wealth management, asset management, and asset servicing to align with strategic goals.

• Created a Chief Operating Officer role to centralize operations and controls, enhancing scalability and efficiency.

• CFO aims to replicate best practices from high-growth, expense-controlled businesses across the firm.

• Key financial metrics include positive operating leverage, expense-to-trust fee ratio of 105-110, pre-tax margin above 30%, and ROE of 10%-15%.

Institutional and wealth business growth

• Institutional servicing strategy now emphasizes scalable, profitable growth, focusing on higher-margin asset owner business and capital markets.

• Organic fee growth target for institutional business is 2-4%, with improved incremental margins due to business mix.

• Wealth management growth driven by standardizing ultra-high net worth offerings and expanding in underpenetrated regions.

• Global Family Office leverages international footprint and holistic solutions for alternatives, accelerating global growth.

Alternatives and investment management

• Private markets growth benefits all segments, with 50 South Capital managing $12B in alternatives and expanding.

• Front Office Solutions technology supports sophisticated tracking of alternatives, especially for family offices.

• Opportunity exists to increase alternative product offerings, with careful manager diligence and client-centric approach.

• Plans to expand ETF offerings and custom SMAs to capture more wallet share from both wealth and institutional clients.