Banking, finance, and taxes

Northern Trust Beats on Both Top and Bottom Lines

Chris Lange

Published: April 19, 2016 8:35 am

Last Updated: January 13, 2020 10:37 am

Northern Trust Corp. (NASDAQ: NTRS) released its first-quarter earnings report before the markets opened on Tuesday. The company said it had $1.01 in earnings per share (EPS) on $1.19 billion in revenue, compared to consensus estimates of $0.95 in EPS on revenue of $1.18 billion. In the same period of last year, the bank posted EPS of $0.94 and $1.14 billion in revenue.

Return on average common equity was 11.4%, compared to 11.3% in the prior-year quarter and 11.1% in the prior quarter. The Basel III capital ratio for common equity was 11.6% from an advanced approach and 10.6% from a standardized approach.

Assets under custody/administration (AUC/A) and assets under management were the primary drivers of this company’s trust, investment and other servicing fees. AUC/A totaled $7.93 trillion at the end of the first quarter.

During the current quarter, the corporation declared cash dividends totaling $5.9 million to preferred stockholders and cash dividends totaling $83.9 million to common stockholders.

Frederick H. Waddell, chairman and CEO of Northern Trust, commented:

Northern Trust performed well in the first quarter of 2016, despite the volatile market environment and heightened global economic uncertainty. Total revenue grew 5%, with strong growth in net interest income and steady growth in trust, investment and other servicing fees, partially offset by lower foreign exchange trading income. Expenses increased 5%, as we continued to invest in people, technology and regulatory initiatives to support our growing business. Our return on equity was 11.4%, within our target range of 10-15%.

Shares of Northern Trust closed Monday up 1% at $68.29, with a consensus analyst price target of $69.76 and a 52-week trading range of $54.38 to $79.25.