Attached files
file | filename |
---|---|
8-K - 8-K - NORTHERN TRUST CORP | d448499d8k.htm |
|
N O R T H E R N T R U S T C O R P O R A T I O N EXHIBIT 99.1
Northern Trust Corporation
Service Expertise Integrity
Goldman Sachs Financial Services Conference
The Conrad Hotel, New York December 4, 2012
Frederick H. Waddell
Chairman & Chief Executive Officer
© 2012 Northern Trust Corporation
northerntrust.com
|
Forward Looking Statement
This presentation may include forward-looking statements such as statements that relate to Northern Trusts financial goals, capital adequacy, dividend policy, expansion and business development plans, risk management policies, anticipated expense levels and projected profit improvements, business prospects and positioning with respect to market, demographic and pricing trends, strategic initiatives, re-engineering and outsourcing activities, new business results and outlook, changes in securities market prices, credit quality including reserve levels, planned capital expenditures and technology spending, anticipated tax benefits and expenses, and the effects of any extraordinary events and various other matters (including developments with respect to litigation, other contingent liabilities and obligations, and regulation involving Northern Trust and changes in accounting policies, standards and interpretations) on Northern Trusts business and results. These statements speak of Northern Trusts plans, goals, targets, strategies, beliefs, and expectations, and refer to estimates or use similar terms. Actual results could differ materially from those indicated by these statements because the realization of those results is subject to many risks and uncertainties.
Our 2011 annual report and periodic reports to the SEC contain information about specific factors that could cause actual results to differ, and you are urged to read them. Northern Trust disclaims any continuing accuracy of the information provided in this presentation after today.
2 Goldman Sachs Financial Services Conference
|
Northern Trust Corporation
A Highly Focused Business Model
Founded in 1889, Northern Trust is a global leader in asset servicing, asset management, wealth management and banking for personal and institutional clients.
Pension funds Individuals Fund managers Families Insurance Family offices Foundations Family foundations & endowments Endowments Privately held Sovereign businesses wealth funds
As of September 30, 2012
3 Goldman Sachs Financial Services Conference
Personal Financial Services
Leading advisor to affluent market
AUM $184 Billion
AUC $429 Billion
Corporate & Institutional Services
Leading global custodian
AUC $4.3 Trillion
AUM $566 Billion
Northern Trust Global Investments
Leading asset manager for personal & institutional clients
AUM $750 Billion
Operations & Technology
Integrated global operating platform
Serving personal and institutional clients
$1.6 Billion in technology spending 2009-2011
|
Personal Financial Services
Comprehensive Approach to Serving the Affluent Market
Cash flow analysis Financial Debt management Planning Tax planning
Retirement planning
Comprehensive investment capabilities Investment Custom asset allocation Management Broad menu of outside managers
Brokerage services
Private and Deposit services Business Custom financing Banking Stock option lending
Wealth transfer planning Trust & Estate Trust and estate services Services Philanthropic advisory services
Securities custody
Family education and governance
Advisory
Family business
Services
Non-financial asset management
Customized investment objectives
Foundation and and strategic asset allocation
Institutional
Manager selection and oversight
Advisors
Asset servicing and administration
4 Goldman Sachs Financial Services Conference
PFS Assets Under Management ($ Billions)
CAGR +6%
S&P 500 CAGR +2% $174 $184 $148 $154 $145 $135 $132 $117 $110 $104 $94 $88
01 02 03 04 05 06 07 08 09 10 11 3Q 2012
|
Corporate & Institutional Services
Delivering a Broad Range of Solutions
Safekeeping
Settlement
Asset Derivatives and collateral processing Processing Income collection
Corporate actions
Tax reclamation
Fund accounting
Transfer agency
Asset
Corporate secretarial/trustee
Administration
Valuations
Investment operations outsourcing
White label reporting
Valuation analytics
Asset
Performance analytics
Reporting
Risk monitoring and reporting
Trade execution analysis
Cross-border pooling
Trade execution
Asset
Cash management
Enhancement
Securities lending
Foreign exchange
Active
Global index
Investment Investment outsourcing Management Liability driven investing
Multi-manager
Transition management
5 Goldman Sachs Financial Services Conference
C&IS Assets Under Custody ($ Trillions)
CAGR +10%
S&P 500 CAGR +2%
US$ EAFE CAGR +2% $4.3
$3.8 $3.7 $3.9
$3.3 $3.3
$2.7 $2.7
$2.3
$1.9
$1.5
$1.3
01 02 03 04 05 06 07 08 09 10 11 3Q 2012
|
Northern Trust Global Investments
Client Focused, Diversified Investment Manager
Providing diversified asset management solutions, with total assets under management of $750 billion across
Client Segments Asset Classes Styles
Personal Short
Equities Active $184 Billion Duration Index $354 Billion $348 Billion $229 Billion (47%) (46%) $344 Billion (31%)
Institutional (46%) $566 Billion
Other
$21 Billion Other
Fixed Income Multi-Manager
(3%) $21 Billion $146 Billion $37 Billion (19%) (3%) (5%)
Delivered through Various Structures
Mutual & Exchange Traded Separate Accounts Commingled Funds Funds (ETF)
As of September 30, 2012
6 Goldman Sachs Financial Services Conference
|
Balance Sheet
Consistently Strong and Conservative
Diversified, High Quality Loan Portfolio
Relationship-based lending
Diversified by loan type, including residential real estate (35%), commercial & institutional (25%), commercial real estate (10%)
Consistent and conservative underwriting standards
1.74%
1.01%
0.98%
0.16%
High Quality, Short Duration Securities Portfolio
91% of Northern Trusts total securities portfolio composed of U.S. Treasury, government sponsored agency and triple-A rated securities
93% of Asset-Backed Securities rated triple-A
The securities portfolio is in a net unrealized gain position
Average maturity duration of ~2 years and a re-pricing duration of ~1 year
Consistently Outstanding Capital Strength
Northern Trust Corporation
Tier 1 Capital Ratio 12.8% Total Risk-Based Ratio 14.3% Leverage Ratio 8.1% Tier 1 Common Equity 12.3%
Capital Return
Increased our quarterly dividend to $0.30 per share in 2012
Repurchased $100 million of common stock YTD in 2012
We are able to repurchase $140 million more through March 2013 under our current capital plan
NCOs to NPAs Avg. Loans to Loans & REO
As of September 30, 2012
Peer group includes U.S. based banks with assets of more than $50 billion as of December 31, 2011, a group of 18 institutions excluding Northern Trust
7 Goldman Sachs Financial Services Conference
|
Impact of the Environment on Profitability and Returns
12.7% Return on Equity
33.1% 10.1% Revenue pressures have
9.5% led to declining margins and returns
26.3% Efforts are underway to
Pre-tax Margin improve profitability in 2012
and beyond a program we call Driving Performance
2009
2010
2011
YTD 2012
As of September 30, 2012
8 Goldman Sachs Financial Services Conference
|
Driving Performance
Improving Profitability and Returns
More than $100MM in pre-tax income improvement has been achieved year-to-date.
We are on track to achieve our 2012 and 2013 targets.
Percent of 2013 Impact
30 35% Revenue Fully align value proposition
Unbundle pricing structures
Enhancements
Expand share of relationship
Streamline major business processes 30 40% Process Optimize operational footprint Optimization Apply best-in-class procurement practices
Refine service delivery model
5 10% Technology Migrate IT resourcing mix
Rationalize overlapping applications
Efficiency
Manage internal end-user demand
Simplify organizational structure 20 25% Corporate-wide Align retirement plans with market Initiatives Rationalize real estate
Consolidate banking charters $250 million
9 Goldman Sachs Financial Services Conference
|
Northern Trust Corporation
Strategically Positioned for Growth
Market Leader in Focused Businesses
Strong History of Organic Growth
Distinctive Financial Strength
Focused on Driving Performance
10 Goldman Sachs Financial Services Conference
|
N O R T H E R N T R U S T C O R P O R A T I O N
Northern Trust Corporation
Service Expertise Integrity
Goldman Sachs Financial Services Conference
The Conrad Hotel, New York December 4, 2012
Frederick H. Waddell
Chairman & Chief Executive Officer
© 2012 Northern Trust Corporation