Attached files
| file | filename |
|---|---|
| 8-K - 8-K - NORTHERN TRUST CORP | d90293d8k.htm |
 Barclays Global Financial
Services Conference 2015
Frederick H. Waddell Chairman & Chief Executive Officer NORTHERN TRUST CORPORATION New York | September 16, 2015 EXHIBIT 99.1 |
 2 northerntrust.com | © Northern Trust 2015 FORWARD-LOOKING STATEMENTS This presentation may include forward-looking statements concerning Northern Trust’s financial results
and outlook, capital adequacy, dividend policy and stock repurchase program,
anticipated expense levels and technology investments, risk management
policies, contingent liabilities, strategic initiatives and investments,
industry trends, and expectations regarding governmental and regulatory initiatives and developments. Forward-looking statements are typically identified by words or phrases such as “believe”,
“expect”, “anticipate”, “intend”, “estimate”,
“project”, “likely”, “may increase”, “plan”, “goal”, “target”, “strategy”, and similar expressions or future or conditional verbs such as “may”, “will”, “should”,
“would”, and “could”. Forward-looking statements
are Northern Trust’s current estimates or expectations of future
events or future results, and involve risks and uncertainties that are difficult to
predict. These statements are based on assumptions about many important
factors, including the factors discussed in Northern Trust’s most
recent annual report on Form 10-K and other filings with the U.S. Securities and Exchange Commission, all of which are available on Northern Trust’s website. We caution you not to place undue reliance on any forward-looking statement as actual results may
differ materially from those expressed or implied by forward-looking statements.
Northern Trust assumes no obligation to update its forward-looking
statements. |
 3 northerntrust.com | © Northern Trust 2015 CLIENT CENTRIC AND HIGHLY FOCUSED BUSINESS MODEL Founded in 1889, Northern Trust is a global leader in asset servicing, asset management and
banking for personal and institutional clients.
As of June 30, 2015 Wealth Management Leading advisor to the affluent market Individuals Families Family offices Foundations Endowments Privately held businesses Corporate & Institutional Services Global provider of investment services for institutional investors Pensions Sovereign entities Fund managers Foundations & endowments Insurance companies Banking $120 billion in assets Asset Servicing $6.2 trillion in AUC Asset Management $946 billion in AUM Integrated Global Operating Platform |
 4 northerntrust.com | © Northern Trust 2015 The personal and institutional markets are large and are growing. Global Personal Financial Wealth $US Trillion
CAGR: 6% 11% ETFs Alternatives Sovereign Wealth Funds Insurance Assets Retirement Funds Mutual/ Collective Funds 2014 2018E Total $114 $147 Global Institutional Assets $US Trillion
$6 $10 $16 $35 $37 $43 INVESTED IN ATTRACTIVE MARKETS Sources: BCG Global Wealth 2015, Cerulli Associates Global Markets 2015, Investment Company Institute, The City UK, eVestment, PWC, ETFGI, Ernst & Young and internal estimates |
 5 northerntrust.com | © Northern Trust 2015 POSITIONED FOR CONTINUED SUCCESS Favorable secular trends align well with Northern Trust’s business model. Growth Trends Global wealth creation Globalization/cross-border investing Expanding use of alternative assets Shift from active to passive management Increased regulation Focus on risk management Demand for transparency Back and middle office outsourcing Opportunity to Differentiate Relationship and client experience are critical drivers of provider selection Brand and differentiated service matter Integrated global operating platform Business Model Recurring fee revenue offers more sustainable economics Attractive financial returns versus many other sectors in financial services Fee-based models preferred over commission-oriented models |
 6 northerntrust.com | © Northern Trust 2015 We are executing on our strategies to: Accelerate growth Improve profitability & productivity Increase shareholder returns FOCUSED ON ACHIEVING PROFITABLE GROWTH |
 7 northerntrust.com | © Northern Trust 2015 ACCELERATING GROWTH Producing strong results. +8% Wealth Management Fees +10% Corporate & Institutional Services Fees +11% AUM +11% AUC 2011 – 1H2015 CAGRs 1H2015 fees are annualized |
 8 northerntrust.com | © Northern Trust 2015 ACCELERATING GROWTH Investing for the future. 1 Global asset management industry AUM and growth projections from Cerulli Associates Global Markets 2015 2 Greater NY $5MM+ household AUM from 2013 Nielsen Claritas (Wealth Management Markets) 3 “Smart Beta” market size and growth projections from Casey Quirk As of June 30, 2015 Asset Management Focus on Engineered Equity >$800B market 3 Est. 24% CAGR through 2019 3 Investing in products & capabilities 17 FlexShares funds with AUM of $8.7B Corporate & Institutional Services Focus on asset managers >$75T market 1 Est. 7% CAGR through 2019 1 Investing in our Global Fund Services business Acquisitions ~$750M Staffing up >3x in 10 years Wealth Management Focus on New York ~$1T market Augmenting our presence in New York Staffing up ~30% since 2013 Strategic advertising and philanthropic spending 2 |
 9 northerntrust.com | © Northern Trust 2015 IMPROVING PROFITABILITY AND PRODUCTIVITY Producing strong results. 1 Differential between revenue and expense CAGRs for the period 2011–1H2015, annualized.
+8pts Since 2011 +2.5 pts Since 2011 -20 pts Since 2011 Expenses/Trust Fees = 111 % In 1H2015 Pre-Tax Margin= 32.2 % In 1H2015 Operating Leverage 1 |
 10 northerntrust.com | © Northern Trust 2015 IMPROVING PROFITABILITY AND PRODUCTIVITY Planning for the future. As of June 30, 2015 |
 11 northerntrust.com | © Northern Trust 2015 INCREASING SHAREHOLDER RETURNS 28¢ 30¢ 31¢ 33¢ 36¢ 2011 2012 2013 2014 2015 Quarterly Dividend 8.6% 9.3% 9.5% 10.0% 12.1% 2011 2012 2013 2014 1H2015 Total Payout Ratios: 100% in 2014 83% in 2013 65% in 2012 58% in 2011 42% in 2010 Improving ROE into our target range of 10%-15% |
 12 northerntrust.com | © Northern Trust 2015 CONSISTENTLY STRONG AND FOCUSED Long-term success through a focused strategy. Market Leader in Focused Businesses A History of Organic Growth Distinctive Financial Strength Proven Record of Managing for Long-term Growth and Profitability |
 |