Northern Trust Bank Analysis

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Northern Trust is a leading provider of global financial solutions for investment management, asset servicing, and banking needs of corporations, institutions, and affluent individuals. Northern Trust is exclusively focused on the custody, management, and servicing of client assets in two target market segments, affluent individuals through its Personal Financial Services (PFS) business unit and its institutional investors worldwide through its Corporate and Institutional Services (C&IS) business unit.” 1 pg3 Northern trust markets these two business units via a third business unit (NTGI) Northern Trust Global Investments which delivers investment management related services and products. The company is focused in using technology as a key strategic advantage for cost control and facilitation of operations.

The Northern Trust Corp was founded in 1889 in Chicago Illinois and trades under the ticker symbol NTRS on the NASDAQ. The Trust is classified as a commercial bank in the super regional group with likes of U S Bancorp Inc, Wells Fargo & Company, S V B Financial Group, B B & T Corp. The company’s headquarters still reside in Chicago and it currently employs approximately 10,900 people. As of Feb 20, 2008 Northern Trust has a market capitalization of 15.4 Billion and has approximately $757B and $4.1T global assets under management and under custody respectively.

1.2 Background

“Northern Trust Corporation (corporation) is a financial holding company under the Gramm-Leach-Bliley Act and was originally organized as a bank holding company in 1971 to hold all of the outstanding capital stock of The Northern Trust Company (bank). The bank is an Illinois banking corporation headquartered in Chicago and the Corporation’s principal subsidiary. PFS services are delivered through a network of over 80 offices in 18 US states as well as offices in London and Guernsey. C&IS products are delivered to clients in approximately 40 countries through offices in North America, Europe, and the Asia Pacific Region.” 1 pg3

1.3 Corporate Structure (data & text here-in sect. 1.3 taken from Reuters unless specified otherwise)

1.3.1 Corporate and Institutional Services

C&IS offers a range of commercial banking services through the Bank, placing special emphasis on developing and supporting institutional relationships in two target markets: large corporations and financial institutions. The Company's asset administration, asset management and related services consist of a range of capabilities, including worldwide master trust, asset servicing, fund administration, settlement and reporting, cash management, and investment risk and performance analytical services. Non-United States client relationships are managed principally through the Bank's London and Singapore branches, and through the Bank's and the Company's non-United States subsidiaries , including support from international offices in North America, Europe, and the Asia-Pacific region.

Trust and asset servicing relationships managed by C&IS includes investment management, securities lending, transition management and commission recapture services, which are provided through NTGI. C&IS also provides related foreign exchange services in Chicago, London, Singapore and Guernsey. At December 31, 2006, total C&IS assets under custody were $3.26 trillion and $562.5 billion were managed.

1.3.2 Personal Financial Services(data & text here-in sect. 1.3.2 taken from Reuters)

PFS provides a range of services, which include individual retirement accounts, guardianship and estate administration, qualified retirement plans, banking (including private banking), personal lending, and residential real estate mortgage lending. PFS focuses on high-net-worth individuals, business owners, executives, professionals, retirees and privately held businesses in its target markets. PFS also includes the Wealth Management Group, which provides customized products and services to meet the...
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