Northern Trust (NTRS) 18 Jan 242023 Q4 Earnings call transcript

Good day, and welcome to the Northern Trust Corporation Fourth Quarter 2023 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Jennifer Childe, Director of Investor Relations. Please go ahead.

Thank you, Ruth, and good morning, everyone, and welcome to Northern Trust Corporation's Fourth Quarter 2023 Earnings Conference Call.

Higgins call Jason is Officer; Tyler, our and our Chairman O'Grady, John on Relations Controller; CEO; Investor and our Grace me this Mike morning our Landers, team. Joining our from Chief Financial .

to The Our only earnings report both fourth guide we review northerntrust.com. be on presentation, call. available trends northerntrust.com. will webcast you January live is use call call at are our XX website which made quarter website, release our our find website financial will being rebroadcast press Also today's through is earnings authorized and the February conference on our This on will that this of XX. on replay available quarterly

this harbor The to the Please to Northern commentary Trust regarding any statement accompanying accuracy apply our disclaims Page this in after on our presentation, call refer continuing XX safe of statements provided forward-looking call. on today. will of which information the

question query for session, question-and-answer through and today's During people again us enable as to opportunity ask today. time as you will as the questions X please related Thank permits. move queue to many us your initial follow-up. This the allow possible joining to and limit X

the to turn call Let me Mike O'Grady. over

Thank you, Jennifer.

to rates. our and would company our inflation bank to difficult interest their experienced our combination join in across few I for these We circumstances. clients failures welcoming serve elevated challenging and of quarter Let last me call. geopolitical efforts visible highly you fourth a the to a teams like under . earnings environment. operating the to instability, Similar XXXX years, tireless thank presented XXXX

to numbers. Turning our

$X.X year-over-year long-term On off progress billion year capped and of share quarter $X.XX. were per $X.X towards solid a driving fourth financial improved were Our reported was Expenses revenue fourth earnings billion. quarter results performance. basis, a

a the for both year-over-year the fourth quarter $XXX notable notable impact on performance quarter million X% revenue periods, with fees and flat Our of trust in in up items the up included X%. basis in was items. Adjusting expenses

in and enable expense disciplined efforts improvements. of our of vendor structural Actions XXXX much footprint changes process making to focused estate management, count automation. real and various rationalization control, on consolidation, head We our sustained long-term included productivity governance

our growth down to in each years. XXXX levels brought was recent expense expense year, too trust relative year-over-year growth we in our Although fee this growth still revenue and quarter high our in

year As such, trajectory lowering our as a expense the further this top growth of remains priority well.

to the businesses. Turning

Wealth historical quarter in offset to fees growth although organic and year. we for the outflows. saw the year, levels, below fourth the solid Within asset product continued level was Our Management, be growth by largely improvement throughout advisory client

client see strength are wealth industry record significant continue tiers where differentiators. ongoing our million track $XX assets, We the above leadership to higher in and in expertise,

in data the our from harness with continue to ability driven people success. wealthiest Our world serving and advice apart holistic of our us for XXX the important will the marketplace the more in than driver and an be to sets analytics coupled years, culture

the experience some around globe. sophisticated working Drawing from of families our the with most

giving window first provide generation after succeeded works its enterprising what secrets publish will will book, families. and Institute Trust Northern the unlock important and doesn't establish The prospect and have value. generation into with will net month, ultra-high to around book channel relationships client a a who families Next families help of worth for what to events business. other gain and us a launched of developed insights country, series The be new book the

in Times Bank for service the succession XXXX, client Best expertise, and a U.S. to in Group. Bank and the were by U.S. Best our exceptional named the we family Financial offices testament Private planning for Finally, as in Private

the wins largely offset performed client in particularly full level and year, outflows Asset generally at transaction We but and growth quarter fourth continuing the Servicing business was both well lower activities. generated solid this capital were and of asset volumes pension for quarter. new healthcare asset markets by asset in fourth the reappointed the plan. included servicing retirement Americas state We also plan. Ontario the Nebraska the owners as plan of Investment in provider with Notable and Council Costco's pension

Throughout a the testament which successfully for the significant and scale largest regions, the We well ability with alternatives year, to our we This appointment credit will world's U.K. firms, add healthy with for solutions also X to asset finalized managers the alternatives private compete some were in to complex generated market terms particularly largest and private momentum of EMEA of received. where our division. and our recently most mandates. is

in Our the numerous European of by Year Year Asset outsourcing and Best the for Global of and Custodian including by provider Europe, best leadership, received industry Funds Servicing Waters, owners Asian innovation Agent asset Administrator Transfer awards business investor. XXXX its for by

our outperforming positive In generated we Asset quarters We've fourth liquidity inflows. of Management, quarter index following inflows good funds in complex, of their in healthy growth momentum client several taxable seen overall X-year with benchmarks. and our our fourth outflows, quarter, of consecutive particularly equity the active high-yield positive including in XX%

growth Our driver our important have revenue. of remain continued alternatives also fee funds to and generate solid an

As a focused the product result, alternatives our capabilities. year launches on largely during

to ongoing uncertainty. In market navigate we entered with momentum, closing, macroeconomic XXXX the positive positioned well and

I'll in discipline profitable With on review to efficiency focus growth, driving our Our performance. model. over it resiliency accelerating squarely and maintaining and Jason? organic to expense that, turn our operating our Jason financial greater is

XXXX And Jennifer welcoming me you fourth and to Mike Mike. quarter in you, our let join earnings call. Thank

into dive of return quarter $X.XX average and X%. results common equity morning, of our Earnings starting million. financial This the share GAAP per X. on income fourth was of the reported $XXX Let's on quarter, Page net we

of we reported included also the related loss the million results $XXX million special on assessment. an portfolio noted As securities slide, a included the of sale completed to They repositioning November. on our in FDIC $XX that

the currency fixed in equity both markets, and . Strong by asset under assets periods, both slightly administration and were outflows in assets offset with under of sharply and Our income favorable on and custody year-over-year management most both periods. drove sequential a improvement coupled basis. up movements,

growth intra-period had on growth. impact sequential the basis, fee a basis XX and market trust lag an approximate an favorable On effects year-over-year fee Asset Servicing unfavorable basis had unfavorable of were segment on impact markets on currency fee and on point trust immaterial. XXX our growth, Given favorable On point sequential within impact movements a year-over-year revenue and impact our arrangements, impacts movements largely currency basis, expenses. a

increase the on year-over-year Excluding All other both an and the noninterest were X% last revenue up and well sequential year. fees down in quarter income servicing sequentially over other over FTE and X% was compared to basis year. was X% Trust, all totaled X.X% basis. notable on decrease year. flat investment items X.X% a and prior up $X.X X% down billion, Expenses sequential and controlled, prior a periods, sequentially

down Net sequentially year interest an was income ago. from on FTE and X% million, up a basis X% $XXX

$XX loan credit Our and stable. the $X in $XX quarter. for Overall, percentage our a decreased levels million charge-offs very was loans of losses the remains quarter provision as from million million. fourth were quality period remained nonperforming prior total credit $XX Net in to loans Nonperforming the during strong. million

Page Turning X. to results Asset our on Servicing

at quarter custody asset administration $XX end. were for under clients Assets trillion servicing

were servicing $XXX Asset Custody administration $XXX fees fund fees totaled million. million. and

trillion. asset management $XXX million. management servicing under asset And $X Asset were clients were fees for Assets Servicing within

Wealth X. Page our business Management to Moving on

management ]. wealth management were for billion clients under our $XXX Assets [

for servicing clients investment and Assets other and were trust management fees million. wealth $XXX

to Page interest trends. X our income sheet and net Moving balance and

due prior X% Our average year X% It billion. meaningfully activity. than in sheet prior basis, $XXX to billion, were $XXX our quarter in deposits the better ending stronger-than-anticipated to essentially year decreased balance and compared experienced the linked with due flat deposits. primarily deposits client on a the to at We expectations. declined quarter a Average borrowing lower lower the quarter, late increase

mix. quarter advances At comprised Despite deposits XX% our deposits our or operational reducing capacity, of XX% of Fed to billion nearly [indiscernible] reduced third and we and the approximately average X/X funds relative significant borrowings institutional both $X leverage comprised to X%, quarter end, by deposits the purchased. institutional total

in repositioning, The portfolio, proceeds million. given an sheet. the record flexibility week, loss X of further this We the rate to approximately completed in our now were we of of securities years. non maturity liquid of both November of sale the balance both the for Earlier enhances associated Shifting X.X billion average repositioning environment. sales available and $XXX assets liquid to dynamic quarter of invested sale reducing which in weighted which is rate side the high-quality involve $X.X duration the high-quality another securities, we with floating the $X.X first short assets securities years. completed billion X asset a

relative Average loan to flat were prior sequentially both $XX the year. and balances billion,

levels the of trading up Our $X end-of-period billion in increase quarter, third an higher were over overdrafts settlement reflecting and related loan X% to balances or year-end activity.

the net interest The not have $XX in on at since to returned quarter. have did loans end quarter of billion. Our activity quarter impact a the fourth material heightened or the first either income

As reminder, approximately The a less year. is continues loan sheet balance total of portfolio than XX% a floating. the to be duration

XX% more levels in on central the of liquid and at held than average. deposits decrease than down, Reserve liquidity strong. assets average banks assets remained our more was Cash Federal Our earning of other the total comprise XX% and borrowings, reflecting high-quality but

to [indiscernible] unique provide Our largely rate continue has be aspects fourth November which net quarter net levels. behavior, to the been quarter interest interest driven less given XXXX an incremental January deposit this $XX will securities in income relative client and XXXX by in income cycle. repositioning per in to predictable million of

stable, net pricing the under as $XXX possible environment $XXX We continues competitive. with income further in long compression currently NIM remain pressure the as range highly expect tightening to deposits to stays and million deposit persists quantitative first quarter to but be be of million. deposit some assumes This interest

X. Turning to Page

expenses As X% reported, up compared sequentially quarter, up as the billion prior in year. the noninterest fourth and were X% to $X.X

on expenses listed Excluding up slide, year-over-year. [ sequentially and notable highlights. think both X% just few under a were fourth periods, as on the I'll under in ] X% just the items quarter in

reflected incentive head base or from taken pay year-to-date. over or count X% offset Excluding items, X% actions expense sequentially, ] prior the was XXX XXXX down [ compensation head in and year. all XXX by X% This time adjustments partially was count down ] notable impact the up [ equivalent Full compensation year-over-year. and reductions

to as depreciation we expense items year-over-year, fee increased expense. due line this in XX% up non-compensation amortization of expense item year-over-year. And software X% of basis X/X amortization periods, Recall finally, notable trust is quarter. Equipment comprised in largely much expense. Excluding realized XXX that leverage up was of the and as points and was all operating

year the new transaction X% rate-driven fee of volume, and results in partially on the generation. elimination waivers XXXX, Page fees and by X. due outflows largely to to Trust Turning asset were full weaker down offset business

in weakness other reflecting X Excluding the the noninterest activities. income securities markets was X%, exchange of trading other foreign and impact repositionings, down capital

interest X% growth. flat the income expenses million $X.X up X%, other was $XXX largely or total noninterest income which categories. for Reported translated were over up revenue Net offset the in decline full billion. the year to to This

in which compares Excluding billion periods, slide, both expenses were favorably items to listed in X.X%, notable on $X.X up as XXXX, the XXXX.

bring further As previously, we rate we've XXXX. noticed to the in down expense growth expect

We depreciation to $XX have software and opportunities in of compensation second expense efficiency will said, line That million expense, X increases provide identified areas $XX base will gains Combined, clear beginning line million pay and XXXX, increase expect XXXX. these drive XXXX and approximately to in compensation our office equipment productivity equipment in levels improvement. items or of $XX key and This alone. adjustments X% hit X million line adjustments in increase, generate quarter. operating compares approximately which expect above pay to sight On we expenses pay rate, we of to XXXX. we within increase of Within the and a base continue expect blended amortization further software. in meaningful XX% our adjustments base from to for a have within

growth including associated should quarter, annual with taxes. along by Employee we to expense employee million. retirement-eligible to look higher out to compensation modest those payroll increase million expense our employees, incentive translate approximately equity first the businesses. As include payments, underlying head expect $XX of the $XX quarter in we a growth This expected with for the to will $XX sequential is to count due following: million benefits increase seasonally First

XX. Page Turning to

capital ratios Our remained in quarter. and strong the regulatory levels

levels well to regulatory required at continue operate minimums. above We our

prior the our equity as the common XXX reflects buffer ratio Tier quarter approach with increase Our a offset above under requirements. in asset standardized X modest risk-weighted flat levels. capital XX.X% at This basis regulatory was accretion point a

quarter. prior was available-for-sale quarter pretax At up ratio from loss points securities leverage basis $XXX X Tier Our XX X.X%, end, the was our on million. unrealized

$XXX repurchases $XXX through the million. million million shareholders common common stock over quarter to and dividends cash in $XXX returned of We of

common the And approximately open For Ruth, we line full million stock common with $XXX repurchases of approximately to please that, for including returned stockholders, year, the questions. million. $XXX

Instructions] go to Glenn We'll Schorr first [Operator Evercore. with

us I appreciate and little a bit the helped you with numbers the covers. I all to more try onto peak

So deposits deposit I pressure. heard NII your XQ pricing stable, on on further the thoughts

is year little rising. that in down NII further assume into it to So before ... window know later reasonable and have loan a pressure deposits bit second the in any floating do the year, combination that future, the with you question that's the is, go deposits, as stabilizing forward XX% might stability on And look but quarter throughout we sticking into still the and I rate around? then of book and go

think it's year. this react right, different ones. think situation cuts. to And the and the betas very might say to different NIM reasonable to looming how down, where very much But helpful with way may think But impact end back numbers the on than it's way be And later to occurred looking [ the with higher. early. initially have the liabilities rising when to of think And Nothing I for cuts the too you're similar just full I going frame eventually rates at about a assets were it what first rate to how point, a rather we it's than ]. good happened are on was think I is year us out

jump things deposits. my tried in in never And One we have X out be price a mind. is setter to

get deposit we higher house, yields aggressive reacting what hold Our at goal on very market has the in we thing saw to market to could keep second pricing the way and in as we for cuts, And following always been clients initial keep cost, that is the deposits. the deposits was. a were these see we deposit to

think I so happens And eventually. initially be what than tougher might

a was And And going Now where we October lot. matter us better were than been predict it's to to was November. anticipated. all that better said, obviously go. volumes the November we than than for December better hard saw extremely volumes October.

predict. it's volumes the be so year, critical in hard super And half what going in the just are happens and first to to of

of follow operating I to markets to mean, X little might just be the fourth alone, I the definitely or a appreciate pricing that. easier This fee bit up had means alone markets leverage. by on end the a quarter. strong

should going the meaningful And ratio? probably discipline So year even on sharper more fee in rate fee the you expenses, quarter. this early expect better make your be do expense progress a first on comments into on some to to your run in lot with

will lag that us if help into And there Yes, definitely the call year. know out you're higher right is coming don't to points walk into effects higher. meaningful, I the the lift, it's we but year. I'd a launch And say the as

house. signs do back money keeps the strategically, then wealth is Mike Asset servicing in assets But well. the that about underneath do Management it. feel as mentioned early both asset management. and then deposits, Asset pipeline Management businesses, in commentary, the of and And the in better, that's the both as But his the our in we important. in keep some math client always just we And our more does flows think we incredibly so business It as house. And of in, helps just business in positive if

signs And organic is from . perspective. we're so movement also of think positive strategic component some early an -- I the feeling

Steven to Chubak . next Wolfe Research go with We'll

deposit unpack X just sense get X sense, to once a And come deposit that just resiliency has RRP, I was last lot hoping least to a a liquidity it, further. to the the the the drive like expected bit wanted just you flows provided feel or months, months. specifically, a helped to trend? that's discussion over to it thinking maybe through the of QT RRP ultimately system X has the next, does you're in Fed be expect as But exhausted happens, a get stability out bit how the impact deposit So ongoing at better with like to of of over of how call

was I . on too And this start, a may had predictive it's about competing come that, think impact program talk sense RRP quantitatively that's and Yes, frankly. I'll a the that it with spitting that for significant banks Mike right have and deposits. we my help. down, because been you're it's a deposits. out really now more do And is effectively that thoughts it results, is lot, than But

so Now think fact impact movements that is different. here much clients up think had think going rate deposit have could this costs are impact And to big And we gone deposit to come how as with and half having having behavior, impact an from year deposits. I the about on that see the again, an about year. of in the a on have also rates the second costs client that down. And

think so of comparing RRP think that how And instead trade. risk it's to rates on think I clients about X% just maybe about but not the and a of how more rates, they X% program,

think I program so to about the environment. and got think And both the we've rate

way stop what that on with And way the they seeing there's said QE down. QT transition as down. portfolio their territory how Unchartered and everyone there was a with Jason they to come might be a the about aggressively going I and when would more agree up for on there. just transition on go

a saw with treasuries. more we had as us. So went down, the alternatives. that as liquidity any the the client we come in with that I clients house. up, lot And think I and treasuries, on into have the other and start time, will meet impact of those objective our And to of is move And into dollars as think, will And of the matter. over into the that an moved behavior timing rates also, work keep moved funds then to said, Jason that try to really needs of

follow-up, especially hikes side actions with just balance bit asset the of rate admittedly duration well. of repositioning the guys quite the peers some volatile, been little you elevated on about, a And more of and the great. trust talked has asset your as for That's given you were some my sheet betas the for

get of to as side rate sheet, wanted snapshot to to is do Just if sense cuts? short as the a today, we balance asset what movement a rates percentage the prepare we eventual of sensitive took for in

is under large sheet, component give of balance across We One buckets. little to the weighted loan in -- think quote you the quarters obviously, the which the is of And weighted roughly about the of numbers average effectively, play the the rate think, X in with. do of average just of a X.X%, are years. second now the loans duration impact meaningful just at that, And you is the about helpful, is And maturity just sense component duration I'll to if also take portfolio, the cash, but sensitive. X you securities that's a of also it size and X floating just XXX% X I give and of large the we book. cash balance this the those, doing portfolio, us a

of what securities clarify book is floating? the just percentage today you can Jason, And

Yes, book the is it's about X/X floating. of

Blostein next to with Alex Sachs. Goldman go We'll

down. that good for maybe actually expected and in quarter I just going pretty to guess a you other became know the the shift guys Any the Just locking bit. building rates effectively the for way, floating have expectations balance sheet for Stephen's come of little more and last a second. this have in obviously a duration quarter. and is guys are kind quick, to as to little to a bit higher floating questions down reason been NII for this more a maybe fact little gone are forward trade about come right sheet I start actually balance but be the been, yields you guess, on rates extending I given

how thinking So you're just curious that. about

and that because the Yes, it's dynamic. on brought markets the duration have more just we're the about is it to X that of as it does talking and have our down. really benefits mind it, make a been a we flexible And lot lot

over we when little that's come the say so to And has where year out. and been go a played shorter, there will bit, a I it's to would out bias -- time step time anticipate obviously last our

had not have think -- view it of off worked from rates risk and dramatic as not in downside rates. it's in played to we of the a rates taking think the I in out, have way favor. as about a materially, But we think do but the I table here, our reduction much just locking

we'd so component some against. And there's that say we can there naturally hedge

sense. Makes for follow noisy. super onetimers, wanted There's up you. to I a the around Got my was just 'XX outlook. obviously. expense X bunch second of

So want couple things. to just a I of clarify

ultimate message be lower the that XXXX to I expense is XXXX. than growth expected guess So is

think growth 'XX about expense core I the was X%. in

confirm which about sort I 'XX? we kind billion want still just base base then of $X.X expense should you're speaking So core is to And off of think of the maybe it billion to, in core $X.X that. to

minute confirm little [indiscernible] X.X%. you're at just we And that, in less a things. and are from a 'XX number probably X.X%. because bit So worthwhile is few to the a we than right, invest right have X%, working of been there a 'XX of base And about think

there make on charge the the And million, a we well. numbers quarter, mentioned $XX and of X to everything. in So special severance-related [ you assessment take $X ] year, out if capability FDIC charges that occupancy in equipment was [indiscernible] write-off, million totaled was the then we as And about QX small [indiscernible] with that mentioned you you walk credit in then million quarter charges, the just is a I severance-related in second [indiscernible]. client sure third $XX give the reported

work from base who a that work tells let's so . of X.X%. -- we us And

UBS. with next Hawken go to We'll Brennan

We'd up love last question that to actually. follow on

So to you would just the that That's thanks of capability. for for inclusive adjusting confirm, clarifying I the of be the write-off think helpful. Number it mention one, base. client did

clear lower in to message that? Does offset you than also the saw want just do but to an base investing, growth? represent at the confirm have drive X% that clarify to looking on pain XXXX, you you're Just like that. floor to levers that to laid sufficient you growth And uplift expense of from software. super a Or out least of some

It's sense working. we've not get floor, what's productivity so does to it 'XX the a which but of -- at from that. in you already give a base And to aggressively we're got use

but our productivity that, work are things more increase guys already that is. this we what transparent we the year. super we've to Some in wanted so that that already predict to is do know in in got And the of level 'XX be reflected you that can

missed that of was of other Okay. operating adjustments And too, that. if expense part I write-off the capability the in sorry, the is

Yes.

from line of comes question KBW. next Mike Our the Brown with

in stability total percentage terms in of business here the NIBs, prepared the sequential dollar activity you the noninterest-bearing I the then remarks. was The stabilize potential referenced supported on the deposits term. or appreciate an and there? for the that that I as maybe touch deposits? the the on this in some of guess, new key a absolute level, at to like the focusing of this see the you deposits, by on Could some either just quarter. a Was positive increase can basis this But near drivers comments And they of

and from reason mentioned a NIB, of performed My the the weeks. observation at is comes and last is few channels business that and the And that looking it's X what base. rest that institutional percentage the it way that it our looking in is actually over it at institutional I it business, it lot more than of driven the less in better of

that And rest certainly And somewhat, than on just like it little behaved but calling of tells necessarily its own. -- it this that institutional looks behaves a subclient client better that me a out channel the the has point, flattened at book. it bit plateau it so not that,

well attractive as wealth on is that -- deposit even book, overall, is saw see deposit are very base highly because in the that And the And And attractive which component obviously to flat, wealth economically, up the average. another though very attractive. nice component nice noninterest-bearing it well, not the to doing that was well at see but very but quarter. whole It the the quarter. not zero, book the dramatically, that obviously, book deposits did they're wealth was we but in increased

today the Okay. investing Great. [indiscernible] How side thoughts, -- and in do touch was some of competitive just I the talk the that could you space? asset think you're where alternative about to just on could about share for if those you you maybe Jason. guess side capabilities maybe I are your that and opportunity for of hoping how Northern the business, landscape Trust? you on servicing maybe And take the business.

Mike. Yes,

asset space perspective. in us marketplace private largely servicing address investor happening or what's opportunity side. markets that. We broadly So I'll believe the the the an with alternative on that is for follows a And major speaking, that from just

have that market expect we that. so is think to And grow. And proposition the we we compelling value that within

private the and global my large the very mandate footprint that the to firms. necessary to capabilities in markets And was it heard that we process capabilities necessary through exhaustive won a business, oriented, do of an comments very we that win went as it. You recently to large X earlier with very after

able to to to area So an market focus we're be we're again, able where it's and grows think as continue of grow for take we share. as X us going and the to

I Mike. the appreciate commentary . Thanks, there.

to Morgan with Kenny Ryan We'll go Stanley. next

I question have capital. a on

your got ratio above we minimum, CETX a couple It's and lot well well last ago, the days the [indiscernible] then of of pushback year's XX.X%. there. comment clearly there's level. regulatory from And letter industry So a above of

Your bit than higher earnings consensus a looks expected. from NII generation little

Is little quarter. Northern's together, any think maybe that lean all a about there this in should buybacks we how how putting there? this and approaching bit So room to year

Sure.

room. So invest a There's a And up tee you're at in the amount opportunities relative of We fair to the the that looking on than other numbers. obviously have we capital. right bit average. we're in more little do quarter, we did buybacks to of always

a going non-HQLA end helpful HQLA peers, -- at of and pride And does grow we're effectively capital. loan take how to We helpful in repositioning portfolio. in could more closely all to shorter out you But we capital know in year the do that, more we want we it look did those take thinking because say more. also on RWA part capital business into we term, it's different to able so sense model and [indiscernible] this were clients invest and is. we the we do talking FX. do in near to strong them securities in to we in how about, reposition book of to our could We The the have. levels the could We to capital being -- more to lending. are think we model evidence in Or repositioning financial the and base make our the all

And room. so there's definitely

a we the on unclear. mind in repurchases have. think do stock We in I but referenced, think which do, we're [indiscernible], we be. what it's relative we'll want briefly, unclear But always about to keep going But to that. but And peers, as given an we good you also that alternatives to did comment have additional you're still letter, eye position which got referenced it's you also to impact we

Class potentially ]shares? also and us outlook? you can your buyback to capital impact any And and on Great. the timing dispose expectations [ And regarding B that of ability update on Visa have would Okay.

Yes.

just monetize and at ] [ So holdings. shareholders to about own follow who on shares million voted And going so X people billion. the half current as it there's B think, we to is rate to Visa just for closely, would don't be next that B over that enable that the I proposal week, exchange $X.X a translates of

like. we what to got is there's this vote The shareholder outstanding, proposal are nothing wait and we've see do. what point, planning looks One, at the still So to to and do?

timing Northern are a this asset it. Trust. there passes said, that to it restrictions But is assuming not for strategic Even

saying of It's beyond the likely that. would take, a so that options. you enable we're to all we'll into to point. early but hold tools combination a to us And going to do. we're few on read discussing And restrictions There's that to details on not going be at this something should the we're what that give

with We'll Deutsche Bank. to Bedell go Brian next

$XX on it could Is annualized couple I I just X you things and comparison a If is versus [ XQ The gave guidance incremental security ]million the sure portfolio make heard that is to from clarify, NII earlier, XQ. period that of right. just sales Jason, correct?

Yes.

to So a bit, me miss following you broke up I tiny are, I I'm if think hesitate but tell don't where you but it.

while in first But helpful November it, quarter call -- help the the $XX by, time $X quarter. a repositioning, we the a going ago, in about round quarter. million the should So little repositioning mentioned million. The to that neighborhood $XX a for million the numbers, of about should helped of quarter be that tune in -- forward which the January

per quarter. $XX [ ]

can side, I on then total on expense the And just to get some clarity try growth. maybe more the Okay. expense

XQ million and said up XQ employee million I versus you of retirement eligible then XQ. benefits in up versus being million $XX the comp because $XX to think $XX options expense

perspective? that. year. growth in ratio than from contribution Or X% idea to expense from you higher expense 'XX? thinking X%. growth 'XX expense capacity to should levers. expense into if improve trust wrong than And than And of on there's be can X% Obviously, lower stay the that but So potentially just improve I'm then through But that total is a X%, translating growth try that on -- different -- from correct we of the to lots better me the

Yes.

So equity the a of Remember, One, Brian, in grants. just retirement couple on booking so both the of up. fully right quarter eligible quarter your those and are things. seasonal, first the numbers confirm first of step-up is that's because our step are

will we tax in of as second, got we second, build be third, itself that caps quarter. come got in pay both numbers second just that of higher in the level. said, vast But is then hit similarly, first the step-up. which that on quarter for represents fourth That and referenced, a And so the majority third, that down And that that million, those of payroll base adjustments $XX to back fourth quarter. quarter we've

X%. So to go the all this to X% year. X% from did that's down The as -- to also, than big was better again, do the a that we said, But floor. difference the seen not goal is X% roughly seen as not to back a it's

productivity X%. than can everything materially get the we're with we're already so the we in X% do is it just walking to better using And the to base fact make that in But going the to difficult.

important. be expectation -- And for I think some we're the addition a what expenses have from us, continue X organic the growth. is That's growth for so that -- and growth doing of -- target we anticipating businesses. That our of want And And in revenue targets we I'll each we're to organic to perspective. is a mention to last drive we it's company. thing

to -- say from operating we're right it's and to perspective, not we're fine-tune X% to well we're to else so positive we thing between X%, hard leverage. much get say And do do hard if make really working an sure doing with to organic and be the fee as doing a we what going it

Seaport We'll Mitchell go Global. Jim next to with

seems [indiscernible] just Maybe in environment, just tough like 'XX, a organic more follow-up little detail. last on little growth maybe that mixed. a a It comment,

board. So more like optimistic across the you're it seems

a more So organic you detail on thoughts growth this just give year? little of can kind prospects us the

here. Sure, I'll off Mike. Jim. It's start

relate where there's that growth. organic I servicing. which management forward of over lower growth organic absolutely that say earnings And levels. we've the would right. definitely gone number about that, has historical behind period a factors a you're been through the than preceding strained talked time and We've our So impact we're on positive the management had that here calls and asset to wealth obviously the to so client in the asset relate outflows why activity, some that going than reason business, And of we

as about, talked Some we've of those around. have turned trends,

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to aspect . Where is as areas, are forward company portfolio in growth. place that of that lift is focused drive growth. So the a of growth, profitable going have our there we then organic at the a also been a we've but looking One in couple organic really few to is of our areas. strategies it

has majority shift So to historically, looking servicing looking been towards forward, of business. more of the the we're more that parts asset scalable the organic our growth. And

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scalable, activities So of if things some we you those others. the more than on about do clients think nature front, more of all for profitable are the that

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in in the technologies And hiring of more we around that. so really be people, more particular that we're about require going take that types to disciplined business investing

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to is So as we would call it the marketplace. here, approach X Northern our Trust

of extent include it's a businesses, end businesses, we're or management asset that we're prospect separate to bundle a particularly the So asset offerings but going servicing, clients. to it's the to on the offering not them, from across client with part multiple work that front to the as to a approach rather with going

well. with And Wealth then certainly Management as

of growing the that comments higher can grow some with has those it that think wealth as the well. management at do through You here, a the earlier we heard nicely We side But can been the our of year. on importantly, in component rate. more advisory clients product fee

talk we That's move that example, as real fixed quantitative for us. So for the into we to those of treasuries clients extent tightening, opportunity a example. move income the and funds, about transitioning short-term can out help the with for

drive So number to we're growth. that a that organic things to of proactively doing try

deposit deposits? kind on overall pressure a just lags maybe of on mix cost. And Mike. color, talked deposit out you is great of quick on pricing, that follow-up Or really assumption that NIBs. still driving an Jason, some further What's shift on pricing? a of Is That's negative pressure still about pricing

higher. first something October, element. ] we still we to And will bit factored quarter, that higher will in though some into we November flat of little think XXX pricing the reason fourth at did Yes. in And going try and than a quarter and it we they fourth something think it first play in than that quarter, in didn't deposit in. quarter, cost to we the was but we're is in part predictions indicated largely come first It's more fine-tuned better It's the as why quarter do And it fourth December that of down actually, the of would look We be that [ lags. the that's pricing what volumes made that quarter. be drive ended even agreements I that like. on to because more

Fed client it. clients have sure is reduce to here. our And -- their we're do we about the highly a but we're again, price does in as making And our general, not going setter, that leave deposits view committed rates, conversations to

We'll go next Research. Autonomous Wildhack to Rob with

a comes question your or expense-to-fee expense year? growth question for precedent I more where better of how I'm what this you lot One expected curious absolute expenses. level approach might ratio growth. would and core takes expense growth than in the mean year the a is what revenue on guess hypothetical that

to it. may but growth. we've to the we Mike expenses. and want we'd ensuring and more committed have Historically, start, an of I'll of absolute to say, grow scalable talked And add terms more were committed to we we also -- well, in want that number to about

highly conversations is already having bringing And scalable. that about so business we're we're that ensuring disciplined on internally on

is bring going on is business at is growth with expense. that shouldn't high be on that line new of of be that to to our volatile or higher even but brings it And expenses so before, of this And that we've the I at -- margin, a a relative change scalable it there commitment to means with business point. more where think on always anticipation sight thought attractive degree at as about desire was how to coming a

Yes.

what I said there. with Jason So agree

outside your to expense point, add trust we're to fee on ratio. of to our Just range

to that drive So we're trying range. into the

And so get trying into indicating, is rather to towards later. we're as sooner that Jason than leaning range

different as relates NII, would say, of, on year get What's X to on I as or this Fed your cuts? from the cuts it there love then say, Fed to, the And opposed X X sensitivity Fed. to scenarios just impact Okay. thoughts the

just been last over I volumes But that And quarters highly just the predict really back those -- looking ability variable. able this depend scenarios hard. been the has theme. It's to but we're on come to going to at, I couple to place. we're there's about our stayed really in and good the And think spread. we of I hang feel well just Yes, are to how on

side, has ironically, predictable. be. we want want saying about our the where on talked so the what we try And be it's opposite just think of it expense make and to on get I we're to to trustee that expenses worked, to but where approach it ratio to less the predictable It's going expense we

there's flexibility . where we're holding follow goes sure client to market on assets. make more side, deposit the more to the the and On willingness

next Fargo. go with Mayo to Mike Wells We'll

is Rucha for Rob This Mike.

up commentary more. follow on wanted bit to Just the a little

custody calculated, under we As year-over-year. about down X% your were fee stats

You mentioned client outflows.

new of is look what's pricing for pressure. business pressure the into year? how much the off that is business versus -- outlook So versus we new what pricing this of 'XX? as was And actual risk kind What

on you the And transaction the and volumes think But Jason, of you then, we need can levels. first it are sometimes during account the were out. that sometimes I just take start, fill I'll to compensated transaction into lower asset all, level, year. Yes, on

So weakness custody that of in the some there. drove fees the

to pricing pricing a From driving if on stable it's the would custody particular perspective, is as there. that nothing I much would lower will, front you competitive environment as pricing say the say far in levels, I relatively

on year you're The new The And for we business. did, its just hit as asset servicing I new think issue the quarter, I'm the look year-over-year at servicing just business. positive. mark the net underlying how of thinking net towards was leaning and -- business with for year-over- And asset more the the company market, as the I the earlier, relative some going rate other story it And of prior and business to their repricing our levels in referenced into is we years. clients less their declining, things transactions look win happening just asset in through is then a get winning. what much the we is of at strong. If but we details

came the but clients, a and from of these volumes impact number year, other dynamics lower of less this lot So transaction of same assets.

Okay. competitive growth deceleration a U.S. if you bit the inside looking Any And Office, the in in dynamic there especially you're any [indiscernible] around? to areas Family up or I grow the and you about of can talk could Global follow rate. that little saw wealth. guess, I changes on

how of management was also on perspective couple businesses right call GFO -- where meaningful years. investment -- rate doing. have always what their had is excellent than change. happens lead X industry that a we've meaningful is small actually done about have in industry-leading last we the have year is the underneath of has much It's lower for weaker, the spikiest things of And They've business. heavily with feel we overall that it's business lot this And passport, of an that client the wealth talk in business. Very impact that leading. platform, to from it, we it some technology a the invested is technology You're they to the but fact of can activity business number and that But the their got a been have. of over -- last years growth it couple lower can accomplishments with been

what with a cloud-enabled coming clients movement able asset they've accounts are of Just done and the and way we've to clients do is reporting all now and they're recently. perspective, -- multiple -- platform what client interacting that lot it's and that with from -- -- all

at business highly in view a what from leading continuing terms it's in from And we're so we're market invest And to doing. that our perspective. the of technology

more is business there's So the about which that what optimistic years. . over couple to of us feel next do coming, very going makes

question-and-answer I over the any conclude like today's comments. of does to for Jennifer to turn call. This back would portion Childe the call closing

with soon. thanks, you Thanks, forward again to everyone, We joining and look . today. us for Ruth, speaking

Thank This conference does your for conclude you today's participation. call.

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