![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Frederick H. Waddell President & Chief Executive Officer NORTHERN TRUST CORPORATION 2008 UBS Global Financial Services Conference May 13, 2008 EXHIBIT 99.1 |
![]() Integrity Expertise Service 2 Forward Looking Statement This presentation may include forward-looking statements such as statements that relate to Northern Trust’s financial goals, dividend policy, expansion and business development plans, 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 with respect to litigation, other contingent liabilities and obligations, and regulation involving Northern Trust and changes in accounting policies, standards and interpretations) on Northern Trust’s business and results. These statements speak of Northern Trust’s 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 2007 financial 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. |
![]() Integrity Expertise Service 3 Client-centric and Highly Focused Northern Trust Clients Pension Funds Large Corporations Investment Management Firms Foundations / Endowments / Healthcare Insurance Companies Government Agencies Taft-Hartley Individuals Families Asset Servicing Highly Focused Business Personal Clients Institutional Clients Two Client Channels Integrated Operations & Technology Platform Asset Management One Operating Platform Banking |
![]() Integrity Expertise Service 4 Client-centric and Highly Focused Credit Cards Retail Banking Consumer Finance Venture Capital Stock Transfer DC Record Keeping Investment Banking Sub-Prime Mortgage Underwriting Asset Backed Commercial Paper Conduits Private Equity Bridge Financing Discount Brokerage American Depositary Receipts While we do adjust our actions to align with prevailing conditions, Northern Trust has resisted the temptation to change our business or risk profile to capitalize on temporarily shifting cycles. Businesses Northern Trust is NOT in: |
![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Personal Financial Services Comprehensive, customized and innovative financial solutions for successful individuals, families, and their businesses. |
![]() 6 Integrity Expertise Service Personal Financial Services Extensive Reach in High Growth Target Market 85 PFS Offices in 18 States Over 50% of the U.S. millionaire market resides within a 45-minute drive of Northern Trust offices. Arizona (8) Florida (25) Illinois (19) Colorado (1) Nevada (1) Missouri (1) Minnesota (1) Washington (1) Michigan (3) Texas (7) California (11) New York (1) Connecticut (1) Delaware (1) Georgia (1) Massachusetts (1) Wisconsin (1) Ohio (1) Projected Annual Household Growth Rates 2007 - 2012 8.1% 9.9% 14.3% Growth Rate by Household Asset Size |
![]() 7 Integrity Expertise Service Personal Financial Services Clients Are at the Center of Everything We Do An holistic approach to supporting our clients’ financial goals and aspirations Retirement Services Qualified Plan Services Defined Benefit Plans Defined Contribution Plans Recordkeeping Investment Management Benefit Payment Services Trust Services Fiduciary Administration and Oversight Family Business Services Philanthropic Services Estate Settlement Services Real Estate and Farm Management Asset Custody Minerals Management Brokerage Full-Service Brokerage Money Market Instruments Safekeeping Online Access Access to Your Banking, Trust, Investment Management, Mutual Funds and Brokerage Information, via Northern Trust Private Passport ® and Wealth Passport ® Financial Planning Retirement Planning Estate Planning Tax Planning Stock Option Planning Asset Allocation 529 Plans Corporate Banking Working Capital and General Corporate Loans Secured and Cash Flow Lending Acquisition Financing Industrial Development Bonds Equipment Finance and Leasing Asset Management Structured Investment Services Asset Allocation Equity Investing Fixed Income Investing Short-Term Asset Management Indexing Alternative Investments Single Stock Strategies Private Banking Personal Credit Lines and Swing Loans Real Estate Development Loans Margin Loans Stock Option Lending Home Mortgages Equity Credit Lines Wealth Management Group Family Office Support Multigenerational Wealth Management Global Asset Servicing for Multi-Manager Investment Programs Data Aggregation and Customized Reporting Tax Lot and Partnership Accounting Investment Consulting and Performance Measurement |
![]() 8 Integrity Expertise Service Private Client Revenues (As a Percentage of Total Company Revenues, Full Year 2007) Source: Company Fourth Quarter 2007 Earnings Release reports; *Merrill Lynch percentage based on 2006 data 35% 30% 16% 12% 10% 10% 9% 5% 42% Northern Trust Wachovia Citigroup Wilmington Trust Bank of America JP Morgan Chase Merrill Lynch* Goldman Sachs Bank of NY Mellon Personal Financial Services Our Focus on the Affluent Market is Unmatched |
![]() 9 Integrity Expertise Service Personal Trust Assets ($ Billions) Source: SNL Financial; As of December 31, 2007 2. 3. 4. 5. 6. 7. 8. 9. 10. Largest Personal Trust Bank in U.S. Source: SNL Financial Northern Trust $205.3 1. Bank of America 127.5 JPMorgan Chase 84.5 Citigroup 69.9 Wachovia 61.9 Bank of NY Mellon 50.7 U.S. Bancorp 42.9 Wells Fargo 42.2 PNC Financial 35.3 SunTrust 27.3 Personal Financial Services Largest Personal Trust Provider in the U.S. |
![]() 10 Integrity Expertise Service $189 $195 $160 $114 $101 $38 $28 $65 $65 $61 $52 $82 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 3/31/08 Industry Leading Provider to the Wealthiest Families: ~400 family relationships in 15 countries Average relationship size = $470+ million 20% of Forbes 400 Richest Americans AUC CAGR 1997-1Q08 = 21% S&P 500 CAGR 1997-1Q08 = 3% Wealth Management – Assets Under Custody ($ Billions) Personal Financial Services Spotlight: Outstanding Growth in Wealth Management |
![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Corporate & Institutional Services Global leader in managing the sophisticated financial needs of corporations, public entities, foundations, endowments, insurance companies and investment managers worldwide. |
![]() 12 Integrity Expertise Service Corporate & Institutional Services Positioned Globally for Growth Positioned to serve clients locally and capitalize on global opportunities. Dublin Limerick 17 Locations Worldwide Trade Settlement in 90+ Markets Clients in 41 Countries Chicago (Corporate Headquarters) Toronto London New York Luxembourg Amsterdam Guernsey Jersey Singapore Beijing Tokyo Bangalore Hong Kong Melbourne Abu Dhabi North America Europe, Middle East, & Africa Asia Pacific |
![]() 13 Integrity Expertise Service Corporate & Institutional Services A Worldwide Leader in the Institutional Marketplace Fund Services Fund Accounting Investment Operations Outsourcing Active Collateral Management Hedge Fund Administration Private Equity Administration Property Administration Asset Servicing Safekeeping Settlement Income Collection Corporate Actions Information Services Risk Management Services Cash Active Quantitative Securities Lending Manager of Managers Foreign Exchange Transition Management Commission Management Accounting Reporting Valuation Attribution Analysis Value at Risk Cross-Border Pooling patent pending Rates of Return Multinational HQ Reporting Regulatory Reporting Compliance Monitoring Market Event Analytics Socially Responsible Investing Asset Management Asset Servicing |
![]() 14 Integrity Expertise Service Corporate & Institutional Services Strong Presence in Target Institutional Segments Pension Plans Foundations, Endowments & Healthcare Public Funds / Taft-Hartley 100 U.S. Corporate Plans 40% 200 U.S. Funds 40% 200 U.K. Funds 29% Northern Serves Of the Top Northern Serves Of the Top 25 Taft-Hartley Funds 40% 100 U.S. Public Funds 37% U.K. Local Authority 30% 50 U.S. Foundations 30% 50 U.S. Endowments 26% 50 U.S. Healthcare Funds 36% Northern Serves Of the Top Source: Pensions and Investments 21 January 2008 (US Pensions), 24 December 2007 (Foundations & Endowments), 28 May 2007 (Asset Managers); Pension Funds and Their Advisors, 2007 (UK Funds); Money Market Directory, 2007 (Healthcare Funds); Lipper Fitzrovia Dublin Fund Encyclopaedia, Administrators, 2006/2007; Lipper Fitzrovia Guernsey Fund Encyclopaedia, Administrators, 2006/2007. Fund Administration • Serves 27% of the Top 200 Asset Managers in the world • #1 Provider of Offshore Private Equity Fund Administration services in Europe • Fund Administrator for more funds in Ireland and Guernsey than any other provider |
![]() 15 Integrity Expertise Service 9% 19% 22% 24% 21% 24% 27% 29% 35% 46% 7% 23% 16% 16% 16% 21% 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 % of Northern Trust Corporation Net Income* resulting from International Activities Corporate & Institutional Services Spotlight: Increasing Contribution from International Activities *2007 net income excludes the impact of the VISA indemnification charge |
![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Northern Trust Global Investments Global, multi-asset class investment manager providing private and institutional clients with comprehensive, value-added investment solutions. |
![]() 17 Integrity Expertise Service Northern Trust Global Investments Diversified, World Class Investment Manager $778.6 Billion Assets Under Management as of March 31, 2008 $457 Billion (59%) Active $281 Billion (36%) Quantitative $41 Billion (5%) Manager of Managers A Diversified Asset Manager Across Asset Classes Across Client Segments $633 Billion Institutional $146 Billion Personal Across Styles Fixed Income $98 Billion (13%) Equities $283 Billion (36%) Short Duration $387 Billion (50%) Other $11 Billion (1%) |
![]() 18 Integrity Expertise Service Canadian & UK Programs Int’l/US Equity Manager of Managers Minority and Emerging Managers Investment Program Solutions International Equities EAFE Index Technology Large Cap Growth Socially Responsible Tax Advantaged Fixed Income and Equity Index Funds Core Fixed Income Municipals Government Short/Intermediate Duration Fixed Income Cash Management Investment Options Northern Trust Global Investments A Continuum of Investment Solutions Multi-Advisor Funds Hedge Funds Private Equity Small Cap Growth Mid Cap Growth Large Cap Value Exchange Fund Enhanced Index Funds International Fixed Income High Yield Stable Value Active Investment Management Growth & Value Equity Short & Long Duration Fixed Income Quantitative Management Index & Enhanced Capabilities Manager of Managers Investment Program Solutions Emerging & Minority Programs Alternative Investments PRODUCT BREADTH Methods of Delivery Separate Accounts Collective Funds Common Funds Mutual Funds Methods of Delivery: Separate Accounts Collective Funds Common Funds Mutual Funds |
![]() 19 Integrity Expertise Service $197 $233 $292 $326 $320 $303 $479 $572 $618 $697 $757 $779 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 3/31/08 Assets Under Management $ Billions 12/31/97 to 3/31/08 CAGR Northern Trust 14% S&P 500 3% Northern Trust Global Investments Strong Growth in Assets Under Management Acquired $75 of Index Assets |
![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Financial Performance |
![]() 21 Integrity Expertise Service Revenue Stream Revenue Stream – Dominated by Fee Income 74% of Total Revenues derived from Non-Interest Income in 2007. Top 20 Bank average equaled 48%. Differentiated Business Model Top 20 Bank Source: SNL Financial |
![]() 22 Integrity Expertise Service Top 20 Bank Source: SNL Financial; *As of December 31, 2007 Revenue Stream Revenue Stream – Dominated by Fee Income 74% of Total Revenues derived from Non-Interest Income in 2007. Top 20 Bank average equaled 48%. Differentiated Business Model Loan Portfolio Loan Portfolio – High Quality Nonperforming assets represented only 0.13% of total outstanding loans as of March 31, 2008. Top 20 Bank average equaled 0.87%.* Nonperforming assets were covered 4.6x by credit loss reserves as of March 31, 2008. Top 20 Bank average equaled 2.3x.* |
![]() 23 Integrity Expertise Service Top 20 Bank Source: FR Y-9C reports and SNL Financial; *As of December 31, 2007 Revenue Stream Revenue Stream – Dominated by Fee Income 74% of Total Revenues derived from Non-Interest Income in 2007. Top 20 Bank average equaled 48%. Differentiated Business Model Loan Portfolio Loan Portfolio – High Quality Nonperforming assets represented only 0.13% of total outstanding loans as of March 31, 2008. Top 20 Bank average equaled 0.87%.* Nonperforming assets were covered 4.6x by credit loss reserves as of March 31, 2008. Top 20 Bank average equaled 2.3x.* Securities Portfolio Securities Portfolio – High Quality and Short Duration 92% of Northern Trust’s total securities portfolio was composed of triple-A rated securities as of March 31, 2008. 75% of Earning Assets reprice or mature within one year as of December 31, 2007. Top 20 Bank average equals 52%.* 78% of Interest-Bearing Deposit liabilities reprice or mature within one year as of December 31, 2007. Top 20 Bank average equals 48%.* |
![]() 24 Integrity Expertise Service Strong Performance in First Quarter 2008 NTRS’ First Quarter 2008: Tumultuous environment Tumultuous environment continued in First Quarter 2008 Record Record operating net income, up 24% vs First Quarter 2007 Record Record total revenues, up 19% vs First Quarter 2007 6% growth in assets under custody vs First Quarter 2007 3% growth in assets under management vs First Quarter 2007 Operating EPS: Completed 13 th consecutive consecutive quarter quarter of double-digit, year-over-year growth Common Equity: Completed 80 th consecutive consecutive quarter quarter of growth Credit quality improved: nonperforming assets decreased and reserve reserve ratios ratios improved improved vs First Quarter 2007 No No securities or leveraged loan write-downs 3/31/08 vs 3/31/07: S&P 500 -6.9%; EAFE -16.9% Note: Operating results exclude the effects of VISA items recognized in First Quarter 2008 |
![]() 25 Integrity Expertise Service Well Positioned for Future Success Attractive Demographic Markets Focused and Conservative Strategy Client Centricity Consistent Leadership and Philosophy Excellence in Execution Success Due to Enduring Principles and Strategies: |
![]() ![]() ![]() © 2008 Northern Trust Corporation Service Expertise Integrity Frederick H. Waddell President & Chief Executive Officer NORTHERN TRUST CORPORATION 2008 UBS Global Financial Services Conference May 13, 2008 |