Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurement Inputs and Valuation Techniques

The following table presents the fair values of Northern Trust’s Level 3 liabilities as of March 31, 2025 and December 31, 2024, as well as the valuation techniques, significant unobservable inputs, and quantitative information used to develop significant unobservable inputs for such liabilities as of such dates.

TABLE 30: LEVEL 3 SIGNIFICANT UNOBSERVABLE INPUTS

	MARCH 31, 2025
FINANCIAL INSTRUMENT	FAIR VALUE	VALUATION TECHNIQUE	UNOBSERVABLE INPUTS	INPUT VALUES			WEIGHTED-AVERAGE INPUT VALUES(1)
Swaps Related to Sale of Certain Visa Class B Common Shares	$29.5 million	Discounted Cash Flow	Conversion Rate	1.53		x	1.53	x
			Visa Class A Appreciation	8.06%			8.06%
			Expected Duration	7	-	29.5 months	20.5 months

(1) Weighted average of expected duration based on scenario probability.

	DECEMBER 31, 2024
FINANCIAL INSTRUMENT	FAIR VALUE	VALUATION TECHNIQUE	UNOBSERVABLE INPUTS	INPUT VALUES			WEIGHTED-AVERAGE INPUT VALUES(1)
Swaps Related to Sale of Certain Visa Class B Common Shares	$27.2 million	Discounted Cash Flow	Conversion Rate	1.54		x	1.54	x
			Visa Class A Appreciation	8.66%			8.66%
			Expected Duration	10	-	32.5 months	23.5 months

(1) Weighted average of expected duration based on scenario probability.

The following table presents the fair values of Northern Trust’s Level 3 assets that were adjusted to fair value on a nonrecurring basis during the year ended December 31, 2024, as well as the valuation technique, significant unobservable inputs and quantitative information used to develop the significant unobservable inputs for such assets as of such dates.

TABLE 33: LEVEL 3 NONRECURRING BASIS SIGNIFICANT UNOBSERVABLE INPUTS

	DECEMBER 31, 2024
FINANCIAL INSTRUMENT	FAIR VALUE(1)	VALUATION TECHNIQUE	UNOBSERVABLE INPUTS	INPUT VALUES	WEIGHTED-AVERAGE INPUT VALUES
Loans	19.1 million	Market Approach	Discount factor applied to real estate collateral-dependent loans to reflect realizable value	20.0%	20.0%

(1) Includes real estate collateral-dependent loans and other collateral-dependent loans.

Recurring Basis Hierarchy Leveling

The following table presents assets and liabilities measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024, segregated by fair value hierarchy level.

TABLE 31: RECURRING BASIS HIERARCHY LEVELING

	MARCH 31, 2025
(In Millions)	LEVEL 1		LEVEL 2		LEVEL 3		NETTING		ASSETS/LIABILITIES AT FAIR VALUE
Debt Securities
Available for Sale
U.S. Government	$	8,010.9	$	—	$	—	$	—	$	8,010.9
Obligations of States and Political Subdivisions	—		303.4		—		—		303.4
Government Sponsored Agency	—		14,288.9		—		—		14,288.9
Non-U.S. Government	—		300.4		—		—		300.4
Corporate Debt	—		121.6		—		—		121.6
Covered Bonds	—		232.5		—		—		232.5
Sub-Sovereign, Supranational and Non-U.S. Agency Bonds	—		4,840.4		—		—		4,840.4
Other Asset-Backed	—		1,830.5		—		—		1,830.5
Commercial Mortgage-Backed	—		535.7		—		—		535.7
Total Available for Sale Debt Securities	8,010.9		22,453.4		—		—		30,464.3
Other Assets
Equity Securities(1)	85.0		25.3		—		—		110.3
Derivative Assets
Foreign Exchange Contracts	—		2,574.9		—		(1,343.7)		1,231.2
Interest Rate Contracts	—		360.4		—		(126.7)		233.7
Total Derivative Assets	—		2,935.3		—		(1,470.4)		1,464.9
Other Liabilities
Derivative Liabilities
Foreign Exchange Contracts	—		2,749.9		—		(1,423.0)		1,326.9
Interest Rate Contracts	—		404.1		—		(4.1)		400.0
Other Financial Derivatives(2)	—		—		29.5		—		29.5
Total Derivative Liabilities	$	—	$	3,154.0	$	29.5	$	(1,427.1)	$	1,756.4

Note: Northern Trust has elected to net derivative assets and liabilities when legally enforceable master netting arrangements or similar agreements exist between Northern Trust and the counterparty. As of March 31, 2025, derivative assets and liabilities shown above also include reductions of $335.4 million and $292.1 million, respectively, as a result of cash collateral received from and deposited with derivative counterparties.

(1) Equity securities consists of a money market investment and Visa Class C common shares with a fair value of $85.0 million and $25.3 million, respectively, as of March 31, 2025.

(2) Consists of swaps related to the sale of certain Visa Class B common shares.

	DECEMBER 31, 2024
(In Millions)	LEVEL 1		LEVEL 2		LEVEL 3		NETTING		ASSETS/LIABILITIES AT FAIR VALUE
Debt Securities
Available for Sale
U.S. Government	$	7,367.5	$	—	$	—	$	—	$	7,367.5
Obligations of States and Political Subdivisions	—		297.6		—		—		297.6
Government Sponsored Agency	—		13,288.9		—		—		13,288.9
Non-U.S. Government	—		296.8		—		—		296.8
Corporate Debt	—		163.8		—		—		163.8
Covered Bonds	—		230.9		—		—		230.9
Sub-Sovereign, Supranational and Non-U.S. Agency Bonds	—		4,583.1		—		—		4,583.1
Other Asset-Backed	—		2,182.7		—		—		2,182.7
Commercial Mortgage-Backed	—		590.2		—		—		590.2
Total Available for Sale Debt Securities	7,367.5		21,634.0		—		—		29,001.5
Other Assets
Equity Securities(1)	85.0		26.3		—		—		111.3
Derivative Assets
Foreign Exchange Contracts	—		4,997.3		—		(1,745.2)		3,252.1
Interest Rate Contracts	—		361.2		—		(165.2)		196.0
Total Derivative Assets	—		5,358.5		—		(1,910.4)		3,448.1
Other Liabilities
Derivative Liabilities
Foreign Exchange Contracts	—		4,709.8		—		(4,197.3)		512.5
Interest Rate Contracts	—		421.4		—		(2.3)		419.1
Other Financial Derivatives(2)	—		—		27.2		—		27.2
Total Derivative Liabilities	$	—	$	5,131.2	$	27.2	$	(4,199.6)	$	958.8

Note: Northern Trust has elected to net derivative assets and liabilities when legally enforceable master netting arrangements or similar agreements exist between Northern Trust and the counterparty. As of December 31, 2024, derivative assets and liabilities shown above also include reductions of $368.2 million and $2.7 billion, respectively, as a result of cash collateral received from and deposited with derivative counterparties.

(1) Equity securities consists of a money market investment and Visa Class C common shares with a fair value of $85.0 million and $26.3 million, respectively, as of December 31, 2024.

(2) Consists of swaps related to the sale of certain Visa Class B common shares.

Changes in Level 3 Liabilities

The following table presents the changes in Level 3 liabilities for the three months ended March 31, 2025 and 2024.

TABLE 32: CHANGES IN LEVEL 3 LIABILITIES

(In Millions)	SWAPS RELATED TO SALE OF CERTAIN VISA CLASS B COMMON SHARES
THREE MONTHS ENDED MARCH 31,	2025		2024
Fair Value at January 1	$	27.2	$	25.4
Total (Gains) Losses:
Included in Earnings(1)	5.6		1.2
Purchases, Issues, Sales, and Settlements
Settlements	(3.3)		(5.5)
Fair Value at March 31	$	29.5	$	21.1

(1) (Gains) losses are recorded in Other Operating Income on the consolidated statements of income.

Fair Value of Financial Instruments

The following tables present the carrying value and estimated fair value, including the fair value hierarchy level, of Northern Trust’s financial instruments that are not measured at fair value on the consolidated balance sheets as of March 31, 2025 and December 31, 2024. The following tables exclude those items measured at fair value on a recurring basis.

TABLE 34: FAIR VALUE OF FINANCIAL INSTRUMENTS

	MARCH 31, 2025
					ESTIMATED FAIR VALUE
(In Millions)	BOOK VALUE		TOTAL ESTIMATED FAIR VALUE		LEVEL 1		LEVEL 2		LEVEL 3
FINANCIAL ASSETS
Cash and Due from Banks	$	4,368.7	$	4,368.7	$	4,368.7	$	—	$	—
Federal Reserve and Other Central Bank Deposits	52,794.9		52,794.9		—		52,794.9		—
Interest-Bearing Deposits with Banks	1,645.3		1,645.3		—		1,645.3		—
Federal Funds Sold and Securities Purchased under Agreements to Resell	124.4		124.4		—		124.4		—
Debt Securities - Held to Maturity	20,874.3		19,486.9		—		19,486.9		—
Loans
Held for Investment	40,666.1		40,361.9		—		—		40,361.9
Other Assets	1,502.4		1,497.4		97.6		1,399.8		—
FINANCIAL LIABILITIES
Deposits	131,025.6		131,079.2		—		131,079.2		—
Federal Funds Purchased	2,377.6		2,377.6		—		2,377.6		—
Securities Sold Under Agreements to Repurchase	335.7		335.7		—		335.7		—
Other Borrowings	6,534.5		6,559.0		—		6,559.0		—
Senior Notes	2,809.3		2,841.2		—		2,841.2		—
Long-Term Debt	4,085.6		4,190.1		—		4,190.1		—
Unfunded Commitments	210.8		210.8		—		210.8		—
Other Liabilities	52.8		52.8		—		—		52.8

    

	DECEMBER 31, 2024
					ESTIMATED FAIR VALUE
(In Millions)	BOOK VALUE		TOTAL ESTIMATED FAIR VALUE		LEVEL 1		LEVEL 2		LEVEL 3
FINANCIAL ASSETS
Cash and Due from Banks	$	4,677.2	$	4,677.2	$	4,677.2	$	—	$	—
Federal Reserve and Other Central Bank Deposits	38,775.4		38,775.4				38,775.4		—
Interest-Bearing Deposits with Banks	1,944.7		1,944.7				1,944.7		—
Federal Funds Sold and Securities Purchased under Agreements to Resell	451.0		451.0				451.0		—
Debt Securities - Held to Maturity	22,296.7		20,654.5				20,654.5		—
Loans
Held for Investment	43,222.5		42,803.2				—		42,803.2
Other Assets	1,506.4		1,499.2		83.3		1,415.9		—
FINANCIAL LIABILITIES
Deposits	122,482.7		122,536.5		—		122,536.5		—
Federal Funds Purchased	2,159.5		2,159.5		—		2,159.5		—
Securities Sold Under Agreements to Repurchase	462.0		462.0		—		462.0		—
Other Borrowings	6,521.0		6,545.3		—		6,545.3		—
Senior Notes	2,769.7		2,800.3		—		2,800.3		—
Long-Term Debt	4,081.3		4,164.4		—		4,164.4		—
Unfunded Commitments	227.1		227.1		—		227.1		—
Other Liabilities	50.6		50.6		—		—		50.6