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Reporting Segments
 9 Months Ended
Sep. 30, 2024
Segment Reporting [Abstract]  
Reporting Segments Reporting Segments
Northern Trust is organized around its two client-focused reporting segments: Asset Servicing and Wealth Management. Asset management and related services are provided to Asset Servicing and Wealth Management clients primarily by the Asset Management business. The revenue and expenses of Asset Management and certain other support functions are allocated fully to Asset Servicing and Wealth Management.
Reporting segment financial information, presented on an internal management-reporting basis, is determined by accounting systems used to allocate revenue and expense to each segment, and incorporates processes for allocating assets, liabilities, equity and the applicable interest income and expense utilizing a funds transfer pricing (FTP) methodology. Under the methodology, assets and liabilities receive a funding charge or credit that considers interest rate risk, liquidity risk, and other product characteristics on an instrument level. Additionally, segment information is presented on an FTE basis as management believes an FTE presentation provides a clearer indication of net interest income. The adjustment to an FTE basis has no impact on Net Income.
Revenues, expenses and average assets are allocated to Asset Servicing and Wealth Management, with the exception of non-recurring activities such as certain corporate transactions and costs incurred associated with acquisitions, divestitures, litigation, restructuring, and tax adjustments not directly attributable to a specific reporting segment, which are reported within Other.
Effective January 2024, Northern Trust implemented certain enhancements to its FTP methodology, impacting the allocation of Net Interest Income to the Asset Servicing and Wealth Management segments. As a result, the approximate impact on the Asset Servicing and Wealth Management segments was a $36 million decrease and a $36 million increase in Net Interest Income, respectively, for the three months ended September 30, 2024. The approximate impact on the Asset Servicing and Wealth Management segments was a $99 million decrease and a $99 million increase in Net Interest Income, respectively, for the nine months ended September 30, 2024. Prior-period segment results have not been revised to reflect this methodology change.
Reporting segment results are subject to reclassification when organizational changes are made. The results are also subject to refinements in revenue and expense allocation methodologies, which are typically reflected on a prospective basis.
The following table presents the earnings contributions and average assets of Northern Trust’s reporting segments for the three- and nine-month periods ended September 30, 2024 and 2023.
TABLE 61: RESULTS OF REPORTING SEGMENTS
($ In Millions)ASSET SERVICINGWEALTH MANAGEMENT
OTHER(1)
RECONCILING ITEMSTOTAL CONSOLIDATED
THREE MONTHS ENDED SEPTEMBER 30,2024202320242023202420232024202320242023
Noninterest Income
Trust, Investment and Other Servicing Fees$667.1 $626.0 $529.5 $485.9 $— $— $— $— $1,196.6 $1,111.9 
Foreign Exchange Trading Income (Loss)59.5 54.3 (5.4)(2.5)— — — — 54.1 51.8 
Other Noninterest Income (Loss)67.3 66.1 35.7 38.1 52.5 2.4 — — 155.5 106.6 
Total Noninterest Income (Loss)793.9 746.4 559.8 521.5 52.5 2.4 — — 1,406.2 1,270.3 
Net Interest Income321.4 281.2 248.0 188.2 — — (7.1)(13.2)562.3 456.2 
Revenue1,115.3 1,027.6 807.8 709.7 52.5 2.4 (7.1)(13.2)1,968.5 1,726.5 
Provision for Credit Losses(0.6)3.1 12.4 10.9 (3.8)— — — 8.0 14.0 
Noninterest Expense860.7 809.3 491.3 456.9 7.4 12.0 — — 1,359.4 1,278.2 
Income before Income Taxes255.2 215.2 304.1 241.9 48.9 (9.6)(7.1)(13.2)601.1 434.3 
Provision for Income Taxes57.1 54.3 75.1 67.7 11.1 (2.3)(7.1)(13.2)136.2 106.5 
Net Income$198.1 $160.9 $229.0 $174.2 $37.8 $(7.3)$— $— $464.9 $327.8 
Percentage of Consolidated Net Income43 %49 %49 %53 %8 %(2)%N/AN/A100 %100 %
Average Assets$108,108.0 $108,656.7 $38,734.9 $31,544.9 $— $— N/AN/A$146,842.9 $140,201.6 
(1) Includes the current quarter gain related to the sale of an equity investment.
(In Millions)ASSET SERVICINGWEALTH MANAGEMENT
OTHER(1)
RECONCILING ITEMSTOTAL CONSOLIDATED
NINE MONTHS ENDED SEPTEMBER 30,2024202320242023202420232024202320242023
Noninterest Income
Trust, Investment and Other Servicing Fees$1,957.3 $1,850.2 $1,548.3 $1,421.6 $— $— $— $— $3,505.6 $3,271.8 
Foreign Exchange Trading Income (Loss)181.6 161.2 (12.1)(6.3)— — — — 169.5 154.9 
Other Noninterest Income (Loss)199.2 199.0 105.3 112.8 737.9 (9.2)— — 1,042.4 302.6 
Total Noninterest Income (Loss)2,338.1 2,210.4 1,641.5 1,528.1 737.9 (9.2)— — 4,717.5 3,729.3 
Net Interest Income900.5 902.6 734.1 635.8 — — (21.3)(39.5)1,613.3 1,498.9 
Revenue3,238.6 3,113.0 2,375.6 2,163.9 737.9 (9.2)(21.3)(39.5)6,330.8 5,228.2 
Provision for Credit Losses(1.9)(3.3)15.7 16.8 (6.3)— — — 7.5 13.5 
Noninterest Expense2,634.0 2,459.7 1,504.9 1,402.4 119.1 33.6 — — 4,258.0 3,895.7 
Income before Income Taxes606.5 656.6 855.0 744.7 625.1 (42.8)(21.3)(39.5)2,065.3 1,319.0 
Provision for Income Taxes146.1 167.4 223.0 207.5 141.8 (10.6)(21.3)(39.5)489.6 324.8 
Net Income$460.4 $489.2 $632.0 $537.2 $483.3 $(32.2)$— $— $1,575.7 $994.2 
Percentage of Consolidated Net Income29 %49 %40 %54 %31 %(3)%N/AN/A100 %100 %
Average Assets$108,025.6 $110,380.4 $38,629.2 $34,311.2 $— $— N/AN/A$146,654.8 $144,691.6 
(1) Includes the current quarter gain related to the sale of an equity investment. Includes the gain related to the net impact from the Visa transactions in the second quarter of 2024, refer to Note 20—Commitments and Contingent Liabilities for further information.
Note: Segment results are stated on an FTE basis. The FTE adjustments are eliminated in the reconciling items column with the Corporation’s total consolidated financial results stated on a GAAP basis. The adjustment to an FTE basis has no impact on Net Income.