Northern Trust Corp at RBC Capital Markets Global Financial Institutions Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Maybe, David, we'll start with you, and then we'll go to Jason with some questions about the Wealth Management division. On the earnings call in January, you guys provided some good color in terms of the strategy and expected financial outcomes for Northern over the medium term. Can we start with this strategy? What are some of the primary benefits you see from Northern's One Northern Trust strategy?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Yes. And following up on that, how do you get the three segments to communicate effectively on a continuous basis rather than just a one-off? Is there any procedures in place or just meetings that once a month, they get together?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Yes. Also, you gave out at the time some medium-term financial targets. First of all, can you remind us what they are? And second, if you can talk about the confidence you have in achieving those targets?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : And as a follow-up to that, what does management focus on to create long-term shareholder value? Is it these items that you just identified? Or how do you guys think about that?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Great. Jason, coming over to Wealth Management, what do you see as the primary growth opportunities in the wealth management business going forward?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Yes. On the geography, so I shouldn't expect the Northern office in Portland, Mainland, right?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Jason, on the relationships and David talked about deepening the relationships with the clients. How sticky -- once you get a very strong relationship in wealth management, how sticky is that? And how do you make it even more sticky so that a competitor couldn't come in and try to steal that customer?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Yes. Good point, very good point. What are some of the obstacles or the largest obstacles you see or impediments for wealth management in growing the business in the current environment?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : And just in the current environment, obviously, we heard about tariffs last night and there's a lot of change. Are the high-net-worth clients concerned? Or when you guys talk to them, what are they saying to you guys about what they're feeling or seeing?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Got it. Good. Dave, maybe coming back to you. Can we talk about anything on the first quarter? How is it shaping up? What are you thinking? I know it's early March.

Question: Gerard Cassidy - RBC Capital Markets - Analyst : And remind me on the guidance for expenses for the full year, what you guys gave? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 2:20PM, NTRS.OQ - Northern Trust Corp at RBC Capital Markets Global Financial Institutions Conference

Question: Gerard Cassidy - RBC Capital Markets - Analyst : And I know, obviously, as a fee-based bank, the majority of revenues are fees, 75%-plus versus a traditional bank. But deposits are still important. And any thoughts on how the deposit trends are going? What are you guys seeing in the deposit area?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Good. Got it. The other important part with your organization and your peers is the investment portfolio securities portfolio. Can you talk to us about how you're managing that in this kind of environment and what you see for that going forward?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : No, it didn't happen, of course, yesterday with the 10-year falling, but we're having a high front end of the curve around 4% on Fed funds and a positive slope which we haven't seen in 20 years.

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Yes. Jason, can we come back to the alternative investments because it has been some of the hottest topics in asset management for the last 10 years, let's call it. Can you elaborate and give us a sense on just how that's fitting together with the One Northern Trust strategy that you guys are putting together?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Got it. Yes. Maybe both of you might want to answer this question, but starting with you David, it seems like over the years, the custody business has always been having pricing pressure to deal with. Can you share with us today, is that still a theme that you guys see from competitive forces that custody and fund administration pricing pressures remain in place and is something that you guys are constantly fighting against?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : Got it. Yes. And Jason touched on this in the wealth management area about you want to make sure you know the next generation before the passing of the patriarch and matriarch of the family. How do you guys do that on the institutional side so that if business comes up for rebidding, how do you ensure that you're really deep with your client so that they don't choose to go somewhere else?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : That's good. That's very good. Can you share with us your thoughts on what's going on in Washington from a regulatory standpoint? There appears to be obviously change coming with all the new heads of the agencies. How are you guys appraising it, especially when it comes to Basel III endgame? What are your guys' thoughts?

Question: Gerard Cassidy - RBC Capital Markets - Analyst : And I would assume you guys are hopeful that during this -- the DFAST CCAR test, more transparency is obviously positive. I mean it's not an issue really for you guys, but more transparency is good.