Oct 21, 2026 earnings call — Quarterly results and strategic growth initiatives
Excluding notable items, revenue grew 11% year-over-year, with EPS of $3.40 for the quarter.
Revenue $2.3B (est $2.3B) · EPS $3.20 (est $2.87)
Key quotes
"This is One Northern Trust in practice, combining capabilities around client needs, strengthening relationships, and creating additional avenues for growth across the firm."
"Our client action plan agents now save relationship managers 2 to 3 hours on every client memo, time they can redirect to clients."
"We returned $514.2 million to common shareholders in the quarter through common stock dividends declared of $161.9 million and common stock repurchases of $352.3 million."
Analyst Q&A 11
price cut on liquidity mandates
Q (Brennan Hawken · BMO): How big was the price compression on the index/liquidity mandates and is it sustainable?
A: They said the price compression was mainly in liquidity mandates tied to the wealth money market fund. They repriced that fund by roughly 10 basis points, which reduced income by about $2 million a month or $6 million a quarter.
"We had to do a repricing of our money market fund related to our wealth management business of roughly 10 basis points, and that's about $2 million a month or $6 million a quarter." — Dave Fox (CFO)
efficiency work by COO office
Q (Manan Gosalia · Morgan Stanley): What actions under the COO and the client-centric model are driving the new operating leverage?
A: They said reorganizing around the COO and moving to a client-centric capability model lets them align operations and technology together. This gives more resiliency and efficiency and they are working capability by capability to deliver scalable growth and better operating leverage.
fourth-quarter fee outlook
Q (Ken Usdin · Autonomous): How should we think about custody/trust fees in 4Q given market pressure, volume, and new business?
A: They described a tug-of-war: fixed income market pressure is a headwind while transaction activity returning to normal and organic new business are tailwinds. They noted about 20% of custody and fund admin fees come from transactions, which should help offset market pressure.
"What you've got really is a battle between the lagged pressure you're going to get from fixed income, the pressure in the fixed income market balanced against transaction activity that should return to normal." — Dave Fox (CFO)
capital return and buybacks
Q (Scott Siefers · TD Cowen): What's the priority for capital (dividend, growth, buybacks) and how aggressive will buybacks be after the new authorization?
A: They said they have returned over $1.5 billion so far and remain on track with their plan for the year. They prioritize covering the dividend first, then funding growth, and use excess capital for share repurchases; they expect to continue robust buybacks into the fourth quarter.
"But we think that we've got obviously plenty of capital to continue a very robust buyback program." — Dave Fox (CFO)
FX trading run rate and capital buffer
Q (David Smith · Truist): Is this quarter's FX level sustainable as a new normal? And does rate uncertainty require a higher capital buffer?
A: They said FX activity is down from the prior quarter but still high, and they believe the FX run rate has reset to a higher 'new normal' due to added clients and outsourced FX flow, though today's level is above that new normal. On capital, they are comfortable with their current ranges around 11 and 12 and are actually above 12, and do not see a need to change capital buffers now.
"I do think we've kind of reset to a new normal, but that new normal is not where we are today." — Dave Fox (CFO)
liquidity pricing vs asset servicing fees
Q (Ebrahim Poonawala · BofA): Was the liquidity mandate price cut tied to Fed moves, and how is fee realization behaving across asset servicing?
A: They said the liquidity pricing hit was primarily a competitive issue in Wealth, not caused by rising rates. For asset servicing fees, they noted fee realization varies by business type and some recent wins are less market-sensitive, so AUC growth can diverge from fee growth.
"Well, so the liquidity pricing that I talked about was primarily in the Wealth Management side of the business." — Dave Fox (CFO)
AI compute costs and tech strategy
Q (Mike Mayo · Wells Fargo): How are you managing rising AI/token compute costs and staying competitive versus larger peers?
A: They said they're aggressively managing costs by owning parts of their tech stack, leveraging large partners like Microsoft, and building flexibility to shift work across models and providers. They emphasized using multiple models and partners, forward-deployed engineers, and the ability to move workloads to the optimal compute to control costs and preserve capabilities and safety.
"The whole idea of being able to shift the work and shift the consumption to the best place, the optimal model, if you will, and the optimal way where you are getting the compute is another critical aspect of this." — Mike O'Grady (CEO·CHAIR)
bolt-on acquisitions
Q (Glenn Schorr · Evercore): Would you consider bolt-on deals to accelerate growth and add capabilities in wealth or asset management?
A: They said they are actively looking for bolt-on opportunities in wealth and asset management that advance strategic objectives. They prefer to deploy capital into strategic acquisitions that meet financial hurdles rather than always buying back stock.
"We are absolutely looking for opportunities to bolt on, whether it is wealth management or asset management, I will say firms or capabilities on that front." — Mike O'Grady (CEO·CHAIR)
wealth margins vs growth investment
Q (Alex Blostein · Goldman Sachs): Will you protect wealth margins or invest to reinvigorate organic growth even if margins dip?
A: They said the primary goal in wealth is growth, and they will invest where needed even if margins decline a bit. Investments focus on talent, digital marketing, and AI-driven prospecting to drive revenue growth, accepting temporary margin compression for long-term growth.
"To the extent that we need to and are investing in what it takes to grow, we can see those margins even come down a little bit." — Mike O'Grady (CEO·CHAIR)
deposit mix and NII guide
Q (Sharon · Wolfe): How do deposit remixing trends (non-interest to interest-bearing) affect the NII outlook and fourth-quarter guide?
A: They said the non-interest-bearing share has stayed fairly consistent since the 2022–2023 reset and they don't expect a change in that percentage. Deposit betas have been slower for retail and higher for institutional, but overall they view the current environment as supportive of stable or slightly higher NIMs.
"Well, obviously the non-interest bearing portion has remained relatively consistent since the 2022, 2023 reset that we had." — Dave Fox (CFO)
ROE improvement drivers and a charge-off
Q (Gerard Cassidy · RBC): How much of the ROE improvement is from business model changes versus market conditions, and what drove the recent small charge-off?
A: They said the improved returns reflect both their actions and a favorable market, and they focus on long-term, through-the-cycle discipline rather than short-term attribution. On the charge-off, management said it was isolated to a single CRE borrower and is a very small part of the loan book; overall credit quality remains strong.
"But the way we literally look at it, though, is less within, I'll call it a quarter or even a year on that backdrop, and really looking at things through the cycle." — Mike O'Grady (CEO·CHAIR)