Northern Trust said on April 21 that its first-quarter profit rose as stronger market conditions pushed up assets under custody and administration and lifted fee income. The Chicago, Illinois-based asset and wealth manager, which serves institutional clients, benefited from heightened market activity and portfolio reshuffling during the quarter.
For the quarter ended March 31, net income increased to $525.5 million, or $2.71 per share, compared with $392 million, or $1.90 per share, a year earlier. The firm reported that assets under custody and administration grew 10% to $18.55 trillion as of March 31, while assets under management were recorded at $1.78 trillion.
Fee income rose 11% to $1.34 billion, reflecting the uplift in client activity. Net interest income - the gap between returns on assets and costs of liabilities - climbed 15% to $662 million for the quarter. Total revenue for the period increased to $2.21 billion from $1.95 billion in the prior-year quarter.
Northern Trust's results echoed those reported by peers such as BNY and State Street, which also posted higher profits driven in part by volatile markets amid rising geopolitical tensions.
Following the announcement, the company's shares were up about 1% in premarket trading. The stock has advanced over 16% so far this year.
Context and drivers
- The firm services institutional assets and saw increased custody balances as markets strengthened and clients adjusted portfolios.
- Higher client trading and rebalancing activity contributed to an 11% gain in fee income.
- Growth in net interest income added to overall revenue expansion, lifting total revenue to $2.21 billion.
Market reaction
Shares rose roughly 1% in premarket trading on the earnings release, and the stock has gained more than 16% year-to-date.
All figures reflect Northern Trust's disclosures for the quarter ended March 31 and comparisons to the same period a year earlier.