AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-3: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 31/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · The full servicing suite and $17.4 trillion of Asset Servicing AUC/A at December 31, 2025 establish substantial operating scope. They do not establish lower unit costs, exclusive assets, network effects or demonstrable switching barriers. A comparative structural advantage therefore remains unassessable.
durability · — · Current scale and organic fee growth do not reveal how long any competitive protection persists. The passages contain no relationship-tenure distribution, migration experience or durable exclusivity. Improved earnings cannot fill that gap, so the durability of an economic moat remains unestablished.
customer dependency · — · Custody, administration and operations outsourcing could embed Northern Trust in client workflows. However, the catalog does not disclose integration depth, replacement difficulty or customer consequences of switching. Service availability is insufficient to grade demonstrated dependence.
erosion resilience · — · Fee growth and positive operating leverage demonstrate recent business progress, but the passages do not identify a competitive challenge and show an established advantage surviving it. They therefore cannot establish resistance to moat erosion or distinguish durable protection from favorable operating conditions.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · — · Third-quarter servicing fees rose 8% year over year, but client assets are explicitly a fee driver. Neither aggregate fee growth nor organic trust-fee growth separates repricing from business volume and mix. The catalog supplies no observed fee-rate outcome sufficient for a numerical pricing assessment.
retention · 2/4 · Growing servicing fees and management's report of organic trust-fee growth across all three businesses support continuing demand indirectly. They do not distinguish retained customers from new business or quantify departures. This supports mixed retention evidence without establishing a retention rate or price-resistant loyalty.
margin resilience · 2/4 · GAAP pre-tax margin improved to 34.7% in third-quarter 2026 from 30.6% a year earlier. Current-quarter gains and second-quarter restructuring charges complicate durability and attribution. The improvement supports mixed demonstrated resilience, but does not itself prove fee-pricing protection.
contractual freedom · — · The supplied passages do not disclose customer-contract duration, repricing rights, termination provisions or minimum fee commitments. The linkage between client assets and fees explains a revenue driver but does not establish Northern Trust's ability to change customer prices or terms.
Predictability90
Financial-sector stability over 5 consecutive reported annual periods: equal weights for nondeclining revenue frequency, revenue-growth volatility (5–40pp), positive consolidated earnings frequency, and net-income/revenue margin volatility (3–20pp). Uses reported accounting scope; not industrial FCF or a growth forecast.
- Nondeclining revenue years (%)
- 75.00
- Revenue growth volatility (pp)
- 9.70
- positiveEarningsShare
- 100.00
- netMarginStdDev
- 2.96
- observedAnnualPeriods
- 5.00
Financial strength63
Qualitative bank assessment: equal-weight average of four current evidence-backed grades (0–4), scaled to 100. Policy financial-industry-1; not an industrial ratio score or credit rating.
capital adequacy · 3/4 · Preliminary September 2026 standardized CET1 was 12.4% for the Corporation against the disclosed 7.0% regulatory minimum. The principal Bank's 11.7% CET1 and other ratios exceeded its disclosed well-capitalized thresholds. These support strong capital adequacy, without implying exceptional protection or guaranteed future sufficiency.
liquidity funding · 2/4 · Highly liquid assets covered 65% of average deposits, including 27% covered by cash and central-bank deposits. Third-quarter average deposits rose 6% year over year but fell 3% sequentially, with most supplied by Asset Servicing. Missing uninsured and depositor-level concentration data constrain confidence in funding stability.
asset liability risk · 2/4 · Third-quarter credit provision was $5.4 million, while September after-tax unrealized AFS securities losses were $547.0 million. These show earnings remained positive alongside identifiable credit and market exposures. Detailed loan quality, duration and interest-rate sensitivities are absent, limiting the assessment to mixed observed risk evidence.
earnings resilience · 3/4 · Third-quarter net income of $642.9 million exceeded $457.6 million a year earlier, alongside 8% servicing-fee growth. Positive operating leverage excluding notable items supports underlying earnings capacity. Gains and lower taxes qualify the result, and the supplied period does not demonstrate severe-cycle durability.
Capital allocation56
Qualitative bank assessment: equal-weight average of four current evidence-backed grades (0–4), scaled to 100. Policy financial-industry-1; not an industrial ratio score or credit rating.
capital efficiency · 3/4 · Corporation-wide return on average common equity reached 20.1% in third-quarter 2026 versus 14.8% a year earlier. This demonstrates strong current accounting capital productivity. Transaction gains and lower taxes support reported returns, limiting conclusions about recurring efficiency and sustainability through a weaker environment.
distributions and buffers · 2/4 · Third-quarter repurchases cost $352.3 million, with $161.9 million of common and $16.2 million of preferred dividends declared, against $642.9 million net income. Substantial preliminary regulatory buffers support these actions. Notable gains, tax benefits and limited through-cycle payout evidence temper a stronger assessment.
dilution and cost · 2/4 · Outstanding common shares fell from 186,337,588 at December 31, 2025 to 182,955,653 at June 30, 2026, demonstrating net share reduction alongside actual repurchases. The $33.1 million employee equity-grant expense qualifies that benefit. Full recurring compensation and financing-cost attribution remain unavailable.
investment discipline · 2/4 · Improving servicing fees and operating leverage provide indirect evidence that the operating platform is producing results. However, a $61.5 million software disposition charge and $51.0 million severance charge qualify investment execution. Project-level returns and a complete comparison of committed spending against outcomes are unavailable.
Management69
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Actual repurchases and higher declared dividends accompany substantial regulatory capital buffers. Software disposition and severance charges show costs of prior investment and organizational decisions. Capital deployment is demonstrated, but repurchase value creation and the returns on reinvestment remain unestablished.
incentive alignment · 3/4 · Disclosed compensation emphasizes multiyear equity, including performance units with three-year cliff vesting. All named executive officers exceeded ownership guidelines at December 31, 2025, and awards carry risk-related recoupment. Partial credit for unvested restricted units qualifies ownership alignment; exceptional shareholder outcomes are not established.
execution · 3/4 · Third-quarter servicing fees increased 8% and net income increased 40% year over year. Management also reports substantial positive operating leverage excluding notable items. These are strong, indirect execution indicators, qualified by transaction gains and a lower effective tax rate rather than attributed entirely to management.
governance · 3/4 · Majority-independent directors, shareholder meeting rights and the absence of a staggered board or poison pill support accountability. Actual attendance and completed director elections show mechanisms operating. The combined Chairman and CEO roles qualify independence, while effectiveness during a serious governance challenge remains untested.
Evidence
Asset servicing and related services encompass a full range of capabilities including but not limited to: custody; fund administration; investment operations outsourcing; investment management; investment risk and analytical services; employee benefit services; securities lending; foreign exchange; treasury management; brokerage services; transition management services; banking; and cash management.
2025 Form 10-K, Asset Servicing capabilities; filed 2026-02-24 · Filed 24/02/2026
At December 31, 2025, total Asset Servicing assets under custody/administration (AUC/A), assets under custody, and assets under management (AUM) were $17.4 trillion, $13.6 trillion, and $1.3 trillion, respectively.
2025 Form 10-K, Asset Servicing client assets at December 31, 2025; filed 2026-02-24 · Filed 24/02/2026
All three businesses delivered organic trust-fee growth, reflecting strong execution across the company.
Third-quarter 2026 earnings release, CEO statement on organic trust-fee growth; filed 2026-10-21 · Filed 21/10/2026
($ In Millions except per share data)
Q3 2026
Q2 2026(1)(2)
Q3 2025
Q2 2026
Q3 2025
Trust, Investment and Other Servicing Fees
$
1,373.0
$
1,349.5
$
1,265.5
2
%
8
%
Other Noninterest Income
250.0
673.0
169.1
(63)
48
Net Interest Income (FTE*)
679.1
683.1
596.3
(1)
14
Total Revenue (FTE*)
$
2,302.1
$
2,705.6
$
2,030.9
(15)
%
13
%
Noninterest Expense
$
1,492.5
$
1,638.6
$
1,422.9
(9)
%
5
%
Provision for Credit Losses
5.4
(5.3)
(17.0)
N/M
N/M
Provision for Income Taxes
153.6
272.5
161.9
(44)
(5)
FTE Adjustment*
7.7
7.6
5.5
1
41
Net Income
$
642.9
$
792.2
$
457.6
(19)
%
40
%
Earnings Allocated to Common Shares
$
621.9
$
782.2
$
437.2
(20)
%
42
%
Diluted Earnings per Common Share
$
3.40
$
4.23
$
2.29
(20)
48
Return on Average Common Equity
20.1
%
25.9
%
14.8
%
Average Assets
$
159,235.9
$
163,575.8
$
151,041.5
(3)
%
5
%
(1) For Q2 2026, Other Noninterest Income included a $525.4 million gain related to Northern Trust's participation in the second Visa Exchange Offer and a $73.9 million loss on available for sale debt securities sold in conjunction with a repositioning of the portfolio.
Third-quarter 2026 earnings release, financial summary and second-quarter transaction items; filed 2026-10-21 · Filed 21/10/2026
N/M - Not meaningful
NORTHERN TRUST CORPORATION THIRD QUARTER 2026 RESULTS
CLIENT ASSETS
Assets under custody/administration (AUC/A) and assets under management are a driver of the Corporation’s trust, investment and other servicing fees, the largest component of noninterest income.
Third-quarter 2026 earnings release, relationship between client assets and servicing fees; filed 2026-10-21 · Filed 21/10/2026
QUARTERS
2026
2025
($ in Millions)
THIRD
SECOND
FIRST
FOURTH
THIRD
Net Interest Income
Interest Income - GAAP
$
2,073.1
$
2,189.3
$
2,234.0
$
2,126.6
$
2,144.3
Add: FTE Adjustment
7.7
7.6
7.6
12.7
5.5
Interest Income (FTE) - Non-GAAP
$
2,080.8
$
2,196.9
$
2,241.6
$
2,139.3
$
2,149.8
Net Interest Income - GAAP
$
671.4
$
675.5
$
654.0
$
641.6
$
590.8
Add: FTE Adjustment
7.7
7.6
7.6
12.7
5.5
Net Interest Income (FTE) - Non-GAAP
$
679.1
$
683.1
$
661.6
$
654.3
$
596.3
Net Interest Margin - GAAP(1)
1.80
%
1.79
%
1.73
%
1.78
%
1.68
%
Net Interest Margin (FTE) - Non-GAAP(1)
1.83
%
1.81
%
1.75
%
1.81
%
1.70
%
Total Revenue
Total Revenue - GAAP
$
2,294.4
$
2,698.0
$
2,205.6
$
2,123.1
$
2,025.4
Add: FTE Adjustment
7.7
7.6
7.6
12.7
5.5
Total Revenue (FTE) - Non-GAAP
$
2,302.1
$
2,705.6
$
2,213.2
$
2,135.8
$
2,030.9
Income before Income Taxes
Income before Income Taxes - GAAP
$
796.5
$
1,064.7
$
700.6
$
633.8
$
619.5
Add: FTE Adjustment
7.7
7.6
7.6
12.7
5.5
Income before Income Taxes (FTE) - Non-GAAP
$
804.2
$
1,072.3
$
708.2
$
646.5
$
625.0
Pre-Tax Margin - GAAP(2)
34.7
%
39.5
%
31.8
%
29.9
%
30.6
%
Pre-Tax Margin (FTE) - Non-GAAP(2)
34.9
%
39.6
%
32.0
%
30.3
%
30.8
%
(1) Net Interest Margin is calculated by dividing annualized net interest income by average interest-earning assets.
Third-quarter 2026 earnings release, GAAP/FTE reconciliation and net interest margin definition; filed 2026-10-21 · Filed 21/10/2026
(2) Pre-Tax Margin is calculated by dividing income before income taxes by total revenue.
Third-quarter 2026 earnings release, pre-tax margin definition; filed 2026-10-21 · Filed 21/10/2026
•$48.7 million (pre-tax) impact to Other Noninterest Income from notable items (after-tax $36.8 million):
Third-quarter 2026 earnings release, current-quarter notable income items; filed 2026-10-21 · Filed 21/10/2026
153.6
272.5
161.9
(44)
(5)
Net Income
$
642.9
$
792.2
$
457.6
(19)%
40%
Effective Tax Rate
19.3
%
25.6
%
26.1
%
(630)
bps
(680)
bps
bps - basis points
The effective tax rate decreased sequentially and from the prior-year quarter primarily due to lower net tax impact from international operations, including a reduction in the current year valuation allowance attributable to U.S.
Third-quarter 2026 earnings release, net income and effective tax-rate explanation; filed 2026-10-21 · Filed 21/10/2026
(2) For Q2 2026, Noninterest Expense included a $61.5 million charge related to software dispositions, a $51.0 million severance-related charge, and a $33.1 million expense related to the the Invested as One equity grant to eligible employees.
Third-quarter 2026 earnings release, second-quarter software, severance and employee equity-grant charges; filed 2026-10-21 · Filed 21/10/2026
Compared to the prior year and excluding notable items, revenues grew 11%, while disciplined expense management generated more than 600 basis points of positive operating leverage.
Third-quarter 2026 earnings release, CEO statement on growth and operating leverage excluding notable items; filed 2026-10-21 · Filed 21/10/2026
During the current quarter, the Corporation declared cash dividends totaling $161.9 million to common stockholders and increased its quarterly cash dividend to $0.88 per share on common stock from the previous $0.80 per share.
Third-quarter 2026 earnings release, common dividends declared and dividend increase; filed 2026-10-21 · Filed 21/10/2026
The Corporation repurchased 1,901,679 shares of common stock, including 12,872 withheld to satisfy tax withholding obligations related to share-based compensation, at a total cost of $352.3 million ($185.27 average price per share).
Third-quarter 2026 earnings release, actual common-share repurchases; filed 2026-10-21 · Filed 21/10/2026
The Corporation also declared cash dividends totaling $16.2 million to preferred stockholders during the current quarter.
Third-quarter 2026 earnings release, preferred dividends declared; filed 2026-10-21 · Filed 21/10/2026
($ In Millions)
Standardized Approach
Advanced Approach
Northern Trust Corporation
September 30, 2026*
June 30, 2026
September 30, 2025
September 30, 2026*
June 30, 2026
September 30, 2025
Well-Capitalized Ratios
Minimum Capital Ratios
Regulatory Capital
Common Equity Tier 1 Capital
$
11,555.6
$
11,605.6
$
11,199.3
$
11,555.6
$
11,605.6
$
11,199.3
Tier 1 Capital
12,368.5
12,418.7
12,028.1
12,368.5
12,418.7
12,028.1
Total Capital
14,650.7
14,706.5
13,581.9
14,466.1
14,516.2
13,375.2
Assets
Risk-Weighted Assets
$
92,872.1
$
95,157.3
$
90,033.7
$
80,490.5
$
81,119.6
$
74,329.4
Average Adjusted Total Assets
158,196.9
162,601.3
150,208.9
158,196.9
162,601.3
150,208.9
Supplementary Leverage Exposure
N/A
N/A
N/A
144,826.4
144,498.8
135,904.7
Capital Ratios
Common Equity Tier 1 Capital
12.4
%
12.2
%
12.4
%
14.4
%
14.3
%
15.1
%
N/A
4.5
%
Tier 1 Capital
13.3
13.1
13.4
15.4
15.3
16.2
6.0
6.0
Total Capital
15.8
15.5
15.1
18.0
17.9
18.0
10.0
8.0
Tier 1 Leverage
7.8
7.6
8.0
7.8
7.6
8.0
N/A
4.0
Supplementary Leverage
N/A
N/A
N/A
8.5
8.6
8.9
N/A
3.0
Third-quarter 2026 earnings release, Northern Trust Corporation regulatory capital; filed 2026-10-21 · Filed 21/10/2026
Standardized Approach
Advanced Approach
The Northern Trust Company
September 30, 2026*
June 30, 2026
September 30, 2025
September 30, 2026*
June 30, 2026
September 30, 2025
Well-Capitalized Ratios
Minimum Capital Ratios
Regulatory Capital
Common Equity Tier 1 Capital
$
10,688.7
$
11,084.4
$
10,437.7
$
10,688.7
$
11,084.4
$
10,437.7
Tier 1 Capital
10,688.7
11,084.4
10,437.7
10,688.7
11,084.4
10,437.7
Total Capital
12,623.3
13,024.6
11,644.4
12,438.7
12,834.4
11,437.7
Assets
Risk-Weighted Assets
$
91,203.5
$
93,697.1
$
88,698.8
$
77,834.5
$
78,677.0
$
72,031.5
Average Adjusted Total Assets
157,586.5
162,049.4
149,705.5
157,586.5
162,049.4
149,705.5
Supplementary Leverage Exposure
N/A
N/A
N/A
143,848.2
143,562.4
135,400.9
Capital Ratios
Common Equity Tier 1 Capital
11.7
%
11.8
%
11.8
%
13.7
%
14.1
%
14.5
%
6.5
%
4.5
%
Tier 1 Capital
11.7
11.8
11.8
13.7
14.1
14.5
8.0
6.0
Total Capital
13.8
13.9
13.1
16.0
16.3
15.9
10.0
8.0
Tier 1 Leverage
6.8
6.8
7.0
6.8
6.8
7.0
5.0
4.0
Supplementary Leverage
N/A
N/A
N/A
7.4
7.7
7.7
3.0
3.0
(*) Regulatory Capital, Risk-Weighted Assets and resulting ratios for the current quarter are considered preliminary until the Form 10-Q is filed with the Securities and Exchange Commission.
Third-quarter 2026 earnings release, The Northern Trust Company regulatory capital, thresholds and preliminary-data footnote; filed 2026-10-21 · Filed 21/10/2026
Standardized Tier 1 Leverage CAPITAL HIGHLIGHTS • Robust capital and liquidity ◦ $12.4 billion in Tier 1 capital ◦ 65% of average deposits covered by highly liquid assets including 27% by cash and central bank deposits ◦ Net unrealized after-tax losses on available-for-sale securities of $547.0 million as of September 30, 2026 • Declared $161.9 million in common stock dividends and $16.2 million in preferred stock dividends in 3Q 2026 • Repurchased $352.3 million of common stock in 3Q 2026 Northern Trust Corporation Capital Ratios 3Q 2026 Capital Ratios STANDARDIZED APPROACH ADVANCED APPROACH Common Equity Tier 1 Capital 12.4% 14.4% Tier 1 Capital 13.3% 15.4% Total Capital 15.8% 18.0% Tier 1 Leverage 7.8% 7.8% Supplementary Leverage N/A 8.5% Standardized Common Equity Tier 1 Capital Update 7.0% Regulatory Minimum 4.0% Regulatory Minimum
Third-quarter 2026 presentation, capital, liquidity coverage, AFS losses and regulatory minimum; filed 2026-10-21 · Filed 21/10/2026
Total Pre-Tax Margin (FTE*)
34.9
%
39.6
%
30.8
%
(4.7)
pts
4.1
pts
Average Loans
Asset Servicing
$
5,321.3
$
5,800.6
$
5,399.9
(8)
%
(1)
%
Wealth Management
36,409.6
35,767.0
36,100.7
2
1
Total Average Loans
$
41,730.9
$
41,567.6
$
41,500.6
—
%
1
%
Average Deposits
Asset Servicing
$
95,765.9
$
100,980.6
$
90,195.3
(5)
%
6
%
Wealth Management
27,524.0
26,715.1
25,370.4
3
8
Other
130.1
150.0
1,134.9
(13)
(89)
Total Average Deposits
$
123,420.0
$
127,845.7
$
116,700.6
(3)
%
6
%
(1) The current quarter gain on the sale of the guardianship services business ($34.0 million) is included entirely within Wealth Management.
Third-quarter 2026 earnings release, segment average loans and deposits; filed 2026-10-21 · Filed 21/10/2026
Outstanding shares of 182,955,653 and 186,337,588
408.6
408.6
Additional Paid-In Capital
1,044.4
1,039.0
Retained Earnings
17,706.5
16,709.3
Accumulated Other Comprehensive Loss
(551.7)
(590.5)
Treasury Stock (62,215,871 and 58,833,936 shares, at cost)
(6,091.1)
(5,493.4)
Total Stockholders’ Equity
13,401.6
12,957.9
Total Liabilities and Stockholders’ Equity
$
179,297.2
$
177,132.7
See accompanying notes to the consolidated financial statements.
June 2026 Form 10-Q, consolidated balance sheet outstanding shares and equity; filed 2026-07-30 · Filed 30/07/2026
For the three and six months ended June 30, 2026, the Corporation repurchased 2,129,047 and 4,617,195 shares of common stock, respectively, at a total cost of $350.6 million ($164.65 average price per share) and $709.5 million ($153.66 average price per share), respectively, including 4,861 and 456,475 shares withheld to satisfy tax withholding obligations related to share-based compensation, respectively.
June 2026 Form 10-Q, three- and six-month common-share repurchases; filed 2026-07-30 · Filed 30/07/2026
Our long-term incentive mix further emphasizes performance-based pay, with 75% of the CEO’s total target incentive, and 70% of the total target incentive for the other named executive officers, delivered through long-term incentive awards.
2026 proxy, long-term incentive allocation for CEO and other named executive officers; filed 2026-03-11 · Filed 11/03/2026
Within long-term incentives, awards are predominantly performance-based, with 65% delivered in performance stock units, which cliff vest at the end of three-year performance period, and 35% delivered in restricted stock units, which vest ratably over a four-year period.
2026 proxy, performance-unit and restricted-unit mix and vesting periods; filed 2026-03-11 · Filed 11/03/2026
As of December 31, 2025, each of our named executive officers exceeded our stock ownership guidelines.
2026 proxy, actual executive ownership-guideline compliance at December 31, 2025; filed 2026-03-11 · Filed 11/03/2026
Net shares obtained through stock option exercise
50% CREDITED
Unvested units related to time-based long-term incentive awards (restricted stock unit awards)
0% CREDITED
Performance-based share awards (performance stock unit awards)
2026 proxy, ownership-guideline treatment of unvested restricted and performance units; filed 2026-03-11 · Filed 11/03/2026
Such awards also are subject to forfeiture and recoupment provisions relating to “ex-post” risk, meaning risk resulting from the recipient’s inappropriate risk-taking that does not materialize until after the performance period in which such inappropriate risk-taking takes place.
2026 proxy, forfeiture and recoupment for subsequently materializing inappropriate risk-taking; filed 2026-03-11 · Filed 11/03/2026
Stockholder Right to Call Special Meetings
BOARD OVERSIGHT
Annual Strategic Planning Meeting with Board and Executive Officers
OTHER GOVERNANCE PRACTICES
No Plurality Voting in Uncontested Director Elections
No Staggered Board
No Poison Pill
No Supermajority Voting Requirements
BOARD INDEPENDENCE AND STRUCTURE
Majority Independent Directors
Engaged Lead Director
Frequent Executive Sessions for Independent Directors
2026 proxy, shareholder rights, board independence and governance practices; filed 2026-03-11 · Filed 11/03/2026
All incumbent directors during 2025 attended at least 75% of the total meetings of the Board and the committees on which they served occurring during the period in which they served.
2026 proxy, actual director attendance during 2025; filed 2026-03-11 · Filed 11/03/2026
MICHAEL O’GRADY, CHAIRMAN AND CHIEF EXECUTIVE OFFICER:
Third-quarter 2026 earnings release, combined Chairman and Chief Executive Officer roles; filed 2026-10-21 · Filed 21/10/2026
Election of Directors
All 13 nominees for director named in the proxy statement for the 2026 Annual Meeting were elected by the votes set forth in the table below.
April 2026 Form 8-K, completed election of all 13 director nominees; filed 2026-04-22 · Filed 22/04/2026
