Northern Trust (NTRS) 10-K risk factor changes: FY2024 vs FY2023

The following discussion sets forth the [added: material] risk factors that we have [removed: identified as being most significant to Northern Trust.][added: identified.]

Further, we cannot assure you that the risk factors herein or elsewhere in our other reports address all potential risks that we may [removed: face and you should not interpret discussion of any risk to imply that such risk has not already materialized.][added: face.]

[removed: Forward-looking statements] [added: For a discussion of the risks] and [removed: other factors] [added: uncertainties] that may affect [added: our] future [removed: results are discussed under] [added: results, see] “Forward-Looking Statements” included in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

- [removed: Many] [added: We are subject to many] types of operational risks [removed: can] [added: that could] affect our earnings negatively.

Market volatility and/or weak economic conditions also [removed: may] [added: could] affect wealth creation, investment preferences, trading activities, and savings patterns, which [added: in turn could] impact demand for certain products and services that we provide.

Our earnings also [removed: may] [added: could] be affected by poor investment returns or changes in [added: our clients’] investment preferences driven by factors beyond market volatility or weak economic conditions.

Poor absolute or relative investment performance in funds or client accounts that we manage or in investment products that we design or provide [removed: may] [added: could] result in declines in the market values of portfolios that we manage and/or administer and [removed: may] [added: could] affect our ability to retain existing assets and to attract new clients or additional assets from existing clients.

Broader changes in [added: our clients’] investment preferences that lead to less investment in mutual funds or other collective funds, such as the shift in [removed: investor] [added: investment] preference to lower fee products, could also impact our earnings negatively.

Changes in interest rates [removed: can] [added: could] affect our earnings negatively.

While a rising interest rate environment generally has [added: had] a positive effect on our net interest margin, in some circumstances, a rise in interest rates [removed: also may] [added: has affected us negatively, and could again in the future] affect us negatively.

For example, the rapid increases in interest rates during 2022 and 2023 adversely impacted the value of certain of our investment securities, [removed: with resultant impacts on] [added: and consequently,] our capital, liquidity, and earnings.

Additionally, higher interest rates historically have caused, and [removed: may] [added: could] in the future cause: market volatility and downturns in equity markets, resulting in a decrease in the valuations of the assets we manage or service for others, which generally impact our earnings negatively; our clients to transfer funds into investments with higher rates of return, resulting in decreased deposit levels and higher fund or account redemptions; our borrowers to experience difficulties in making higher interest payments, resulting in increased credit costs, provisions for loan and lease losses and charge-offs; reduced bond and fixed income fund liquidity, resulting in lower performance, yields and fees; or higher funding costs.

Further, [removed: their] [added: the Federal Reserve Board’s] policies can affect our borrowers by increasing interest rates or making sources of funding less available, which may increase the risk that borrowers fail to repay their loans from us.

[added: Changes in monetary, trade and other governmental policies are beyond our] control and can be difficult to predict, and we cannot determine the ultimate effect that any such changes would have upon our business, financial condition or results of operations.

Foreign market [added: volatility] and economic disruptions have affected, and may in the future affect, consumer confidence levels and spending, international trade policy, personal bankruptcy rates, levels of incurrence of and default on consumer debt, and home prices.

Additionally, financial markets may be adversely affected by the liquidity or capital deficiencies (actual or perceived) of financial institutions and related industry and government actions, [removed: current or anticipated impact] [added: the outbreak] of [removed: military conflict] [added: hostilities or political and governmental instability] (including the [removed: continuing] [added: expansion or escalation of] military [removed: conflicts involving] [added: conflict between] Ukraine and the Russian Federation [removed: and Israel and Hamas and other evolving events] [added: or the conflict] in the Middle [removed: East),] [added: East, and tensions between the U.S. and China),] terrorism, political or civil unrest, public health epidemics or pandemics, [removed: the exit or potential exit of one or more countries from the EU,] sovereign debt downgrades or debt crises, or other geopolitical events.

[removed: For example,] developments related to the U.S. federal debt ceiling, including the possibility of a government shutdown, default by the U.S. government on its debt obligations, or related credit-rating downgrades, could have adverse effects on the broader economy, disrupt access to capital markets, and contribute to, or worsen, an economic recession.

Declines in the value of securities held in our investment portfolio [removed: can] [added: could] affect us negatively.

The value of securities available for sale and held to maturity within our investment portfolio, which is generally determined based upon market values available from third-party sources, have fluctuated, and may continue in the future to fluctuate, as a result of market volatility and economic or financial market [removed: conditions.][added: conditions, including interest rates.]

For example, in [removed: 2023, and again in early 2024,] [added: recent years,] we realized notable losses on the sale of available for sale securities and we may realize additional losses in the future.

We provide foreign exchange services to our clients, primarily in connection with our [removed: global] custody business.

Fluctuations in exchange rates [removed: may] [added: could] raise the potential for losses resulting from foreign currency trading positions where aggregate obligations to purchase and sell a currency other than the U.S. dollar do not offset each other or offset each other in different time periods.

Any failure or circumvention of our procedures to mitigate risk [removed: may] [added: could] impact earnings negatively.

In [added: addition, in] past periods, reductions in the volatility of currency-trading markets, the level of cross-border investing activity, and the demand for borrowing securities or willingness to lend such securities have affected our earnings from activities such as foreign exchange trading and securities lending negatively.

If these conditions occur [added: again] in the future, our earnings from these activities [removed: may] [added: could] be affected negatively.

[removed: Many] [added: We are subject to many] types of operational risks [removed: can] [added: that could] affect our earnings negatively.

Factors that [removed: can] [added: could] impact [added: our] operations and expose us to risks varying in size, scale and scope, some or all of which [removed: may] [added: could] be exacerbated by the trend toward hybrid and remote working arrangements in recent years, include:

The third parties with which we do business also are susceptible to the foregoing risks (including regarding the third parties with which they are similarly interconnected or on which they otherwise rely), and our or their business operations and activities may therefore be affected adversely, perhaps materially, by failures, [added: disruptions,] terminations, [removed: errors] [added: software bugs] or [added: errors, natural disasters or] malfeasance by, or attacks or constraints on, one or more financial, technology, infrastructure or government institutions or intermediaries with whom we or they are interconnected or conduct business.

Our systems involve the storage, transmission and other processing of clients’ and our personal, proprietary, confidential and sensitive information, and security breaches, including cyber-attacks or other information security incidents, [added: have previously exposed us and] could [added: in the future] expose us to [removed: a risk of] theft, loss, destruction, gathering, monitoring, dissemination, misappropriation, misuse, alteration, or unauthorized disclosure of or unauthorized access to this information.

Despite our implementation of a variety of security measures, our computer systems, networks, and data, including clients’ or our personal, proprietary, confidential and sensitive information, could be subject to cyber-attacks or other information security incidents, such as, among other things, from physical and electronic break-ins or unauthorized tampering, [added: theft,] malware and computer virus attacks, ransomware attacks, social engineering attacks (including phishing [removed: attacks)] [added: and vishing attacks), credential stuffing, account takeovers, insider threats] or denial-of-service attacks.

[removed: Any failure, interruption or breach in the security of our systems could severely disrupt our] operations and could subject us to liability claims, harm our reputation, interrupt our operations, or otherwise adversely affect our business, financial condition or results of operations.

Data privacy and security risks for large financial institutions like us are significant in part because of the evolving proliferation of new technologies, the use of internet-based solutions, mobile devices, and cloud technologies to conduct financial transactions and the increased sophistication and rapidly evolving techniques of hackers, terrorists, organized crime and other external parties, including foreign state actors and state-sponsored actors, any of which may see their effectiveness enhanced by the use of [removed: artificial intelligence.][added: AI.]

Data privacy and security risks also may derive from fraud or malice on the part of our employees or third parties, or may result from human error, software [removed: bugs,] [added: bugs or errors,] server malfunctions, software or hardware failure or other technological failure.

Also, [removed: like many large enterprises,] the trend in the past several years toward a hybrid work environment that includes a combination of in-office and remote work creates a broader attack surface for, and [added: increases] potential vulnerabilities from, cyber threats.

[added: It may take a significant amount of time before such an] investigation can be completed and full and reliable information about the incident is known.

[removed: Although] we [removed: maintain insurance coverage in the event of information theft, damage, or destruction from cyber-attacks or other information security incidents, there can be no assurance that liabilities or losses we] may incur will be covered under such policies, that the amount of insurance will be adequate to cover such losses, that insurance will continue to be available to us on economically reasonable terms, or at all, or that our insurer will not deny coverage as to any future claim.

Our non-U.S. operations accounted for [removed: 32%] [added: 27%] of our revenue in [removed: 2023.][added: 2024.]

[removed: In recent years, increased] [added: Increased] expenses have affected—and a failure to control our costs and expenses in the future, whether as a result of inflation or otherwise, could affect—our earnings negatively.

Pandemics, natural disasters, global climate change, acts of terrorism, geopolitical tensions, global conflicts (including the continuing military [removed: conflicts involving] [added: conflict between] Ukraine and the Russian [removed: Federation] [added: Federation, the conflict in the Middle East] and [removed: Israel] [added: tensions between the U.S.] and [removed: Hamas)] [added: China)] or other similar events, as well as government actions or other restrictions in connection with such events, have had in the past, or may in the future have, a negative impact on our business and operations.

[removed: If the subcustodian or clearing agency were to become insolvent in circumstances not involving expropriation of assets or other sovereign risk] events [removed: and/or factors or events] beyond our reasonable control that excuse performance under force majeure or other contractual provisions, the risk of loss on such cash on deposit may potentially be incurred by us.

Although we discuss these risk factors primarily in the context of their potential effects on our business, financial condition or results of operations, these risks could have other possible adverse consequences, including those described below.

- Changes in a number of particular market conditions, including in foreign currency rates, cross-border investing activity and the demand for borrowing or lending securities, could affect our earnings negatively.

For example,

Changes in a number of particular market conditions, including in foreign currency exchange rates, cross-border investing activity and the demand for borrowing or lending securities, could affect our earnings negatively.

Any failure, interruption or breach in the security of our systems could severely disrupt our

Although we maintain insurance coverage in the event of information theft, damage, or destruction from cyber-attacks or other information security incidents, there can be no assurance that liabilities or losses

If the subcustodian or clearing agency were to become insolvent in circumstances not involving expropriation of assets or other sovereign risk events and/or factors or

If we experience diminished financial strength or stability, actual

Various regulatory bodies have demonstrated heightened scrutiny of financial institutions through many regulatory initiatives.

We expect the current U.S. presidential administration will seek to implement a regulatory reform agenda that is significantly different than that of the prior administration, impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies.

Moreover, the turnover of the U.S. presidential administration is expected to result in certain changes in the leadership and senior staffs of the federal banking agencies which are likely to impact the rulemaking, supervision, examination and enforcement priorities and policies of such agencies, the potential impacts of which, if any, we cannot predict at this time.

Further, the regulatory framework for AI and similar technologies, and automated decision making, is changing rapidly.

It is possible that new laws and regulations will be adopted in the U.S. and in non-U.S. jurisdictions, or that existing laws and regulations may be interpreted, in ways that would affect the operation of our products and services and the way in which we use AI and similar technologies.

For more information on regulations regarding AI, see “Supervision and Regulation” in Item 1, “Business.”

the EU and the UK and regulatory expectations of governance and accountability with respect to the protection of personal, proprietary, confidential and sensitive information continue to expand and evolve.

For example, the failures in 2023 of Silicon Valley Bank, Signature Bank, and First Republic Bank and the regulatory investigations into these failures resulted in increased regulatory scrutiny

and heightened supervisory expectations of these banks, which could require us to expend significant time and effort to implement enhanced compliance procedures or to incur other expenses.

Additionally, various stakeholders have divergent views on ESG-related matters, including in the

While these changes could create opportunities, they could also adversely impact us or our clients.

This includes the development and marketing of effective and competitive new products, objectively understanding how climate changes might impact the financial performance of direct and indirect client investments, and other services designed to address our clients’ climate related needs.

This can be in relation to a number of climate change areas and can lead to negative publicity and reputational damage.

For example, questions on how the impacts of climate change are being reflected in business and investment decisions and the decision to reduce involvement in certain industries or projects associated with climate change.

Due to the divergent views of stakeholders, we are at increased risk that any action, or lack thereof, by us concerning our response to climate change will be perceived negatively by some stakeholders, which could adversely impact our reputation and business.

In addition, the use of generative AI, a relatively new and emerging technology in the early stages of commercial use, exposes us to additional risks, such as damage to our reputation, competitive position, and business, legal and regulatory risks and additional costs.

For example, generative AI has been known to produce false or “hallucinatory” inferences or output, and certain generative AI uses machine learning and predictive analytics, which can create inaccurate, incomplete, or misleading content, unintended biases, and other discriminatory or unexpected results, errors or inadequacies, any of which may not be easily detectable.

Additionally, to the extent that we do not have sufficient rights to use the data or other material or content used in or produced by the AI tools used in our business, or if we experience cybersecurity incidents in connection with our use of AI, it could adversely affect our reputation and expose us to legal liability or regulatory risk, including with respect to third-party intellectual property, privacy, data protection and cybersecurity, publicity, contractual or other rights.

Further, our competitors or other third parties may incorporate AI into their products more quickly or more successfully than us, which could impair our ability to compete effectively.

As the utilization of AI becomes more prevalent, we anticipate that it will continue to present new or unanticipated ethical, reputational, technical, operational, legal, competitive, and regulatory issues, among others.

As a result, the challenges presented with our use of AI could adversely affect our business, financial condition, and results of operations.

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Although we discuss these risk factors primarily in the context of their potential effects on our business, financial condition or results of operations, you should understand that these effects can have further negative implications such as: reducing the price of our common stock and other securities; reducing our capital, which can have regulatory and other consequences; affecting the confidence that clients, counterparties and/or applicable regulators have in us, with a resulting negative effect on our ability to conduct and grow our businesses; and reducing the attractiveness of our securities to rating agencies and potential purchasers, which may affect adversely our ability to raise capital and secure other funding or the cost at which we are able to do so.

These risk factors also serve to describe factors which may cause our results to differ materially from those described in forward-looking statements included herein or in other documents or statements that make reference to this Annual Report on Form 10-K.

- Volatility levels and fluctuations in foreign currency exchange rates may affect our earnings.

- Changes in a number of particular market conditions can affect our earnings negatively.

Changes in monetary, trade and other governmental policies are beyond our

Volatility levels and fluctuations in foreign currency exchange rates may affect our earnings.

Changes in a number of particular market conditions can affect our earnings negatively.

It may take a significant amount of time before such an

For example, in the event of future turmoil in the banking

We cannot provide assurance that these programs and policies are or will be adequate to identify and manage internal and external compliance risks.

Legal developments in the EEA and the UK also have created complexity and uncertainty regarding processing and transfers of

The Corporation and other financial

impact our reputation.

The following is management’s discussion and analysis of the financial condition and results of operations (MD&A) of Northern Trust Corporation (Corporation) for the year ended December 31, [removed: 2023.][added: 2024.]

Investors also should read the section [removed: entitled] [added: titled] “Forward-Looking Statements.”

TABLE [removed: 4:] [added: 3:] FINANCIAL HIGHLIGHTS

| | | | FOR THE YEAR ENDED DECEMBER 31, | | | | | | | | | [added: | | | % Change(1) | | | | | |]

| ($ In Millions) | | | [removed: 2023] [added: 2024] | | | [added: 2023 | | |] 2022 | | | [removed: 2021] | | | [added: 2024 / 2023 | | | 2023 / 2022 | | |]

| Noninterest Income | | | $ | [removed: 4,791.5] [added: 6,113.3] | | $ | [removed: 4,874.0] [added: 4,791.5] | | $ | [removed: 5,081.8] [added: 4,874.0] | | [added: | | | 28 | | % | (2) | | % |]

| Net Interest Income | | | [removed: 1,982.0] [added: 2,177.1] | | | [added: 1,982.0 | | |] 1,887.2 | | | [removed: 1,382.7] | | | [added: 10 | | % | 5 | | % |]

| Total Revenue | | | $ | [removed: 6,773.5] [added: 8,290.4] | | $ | [removed: 6,761.2] [added: 6,773.5] | | $ | [removed: 6,464.5] [added: 6,761.2] | | [added: | | | 22 | | % | — | | % |]

| Provision for Credit Losses | | | [removed: 24.5] [added: (3.0)] | | | [added: 24.5 | | |] 12.0 | | | [removed: (81.5)] | | | [added: N/M | | | N/M | | |]

| Noninterest Expense | | | [removed: 5,284.2] [added: 5,633.9] | | | [added: 5,284.2 | | |] 4,982.9 | | | [removed: 4,535.9] | | | [added: 7 | | % | 6 | | % |]

| Income before Income Taxes | | | $ | [removed: 1,464.8] [added: 2,659.5] | | $ | [removed: 1,766.3] [added: 1,464.8] | | $ | [removed: 2,010.1] [added: 1,766.3] | | [added: | | | 82 | | % | (17) | | % |]

| Provision for Income Taxes | | | [removed: 357.5] [added: 628.4] | | | [added: 357.5 | | |] 430.3 | | | [removed: 464.8] | | | [added: 76 | | % | (17) | | % |]

| Net Income | | | $ | [removed: 1,107.3] [added: 2,031.1] | | $ | [removed: 1,336.0] [added: 1,107.3] | | $ | [removed: 1,545.3] [added: 1,336.0] | | [added: | | | 83 | | % | (17) | | % |]

| Preferred Stock Dividends | | | 41.8 | | | 41.8 | | | 41.8 | | | [added: | | | — | | % | — | | % |]

| Net Income Applicable to Common Stock | | | $ | [removed: 1,065.5] [added: 1,989.3] | | $ | [removed: 1,294.2] [added: 1,065.5] | | $ | [removed: 1,503.5] [added: 1,294.2] | | [added: | | | 87 | | % | (18) | | % |]

| PER COMMON SHARE | | | | | | | | | | | | [added: | | | | | | | | |]

| Net Income – Basic | | | $ | [removed: 5.09] [added: 9.80] | | $ | [removed: 6.16] [added: 5.09] | | $ | [removed: 7.16] [added: 6.16] | | [added: | | | 93 | | % | (17) | | % |]

| – Diluted | | | [removed: 5.08] [added: 9.77] | | | [added: 5.08 | | |] 6.14 | | | [removed: 7.14] | | | [added: 92 | | % | (17) | | % |]

| Cash Dividends Declared Per Common Share | | | 3.00 | | | [added: 3.00 | | |] 2.90 | | | [removed: 2.80] | | | [added: — | | % | 3 | | % |]

| [removed: Book] [added: Carrying] Value – End of Period (EOP) | | | [removed: 53.69] [added: 60.74] | | | [added: 53.69 | | |] 49.78 | | | [removed: 53.58] | | | [added: 13 | | % | 8 | | % |]

| Market Price – EOP | | | [removed: 84.38] [added: 102.50] | | | [added: 84.38 | | |] 88.49 | | | [removed: 119.61] | | | [added: 21 | | % | (5) | | % |]

| SELECTED RATIOS AND METRICS | | | | | | | | | | | | [added: | | | | | | | | |]

| Return on Average Common Equity | | | [removed: 10.0] [added: 17.4] | | % | [removed: 12.7] [added: 10.0] | | % | [removed: 13.9] [added: 12.7] | | % | [added: | | | | | | | | |]

| Return on Average Assets | | | [removed: 0.78] [added: 1.39] | | | [added: 0.78 | | |] 0.88 | | | [removed: 0.99] | | | [added: | | | | | |]

| Dividend Payout Ratio | | | [removed: 59.1] [added: 30.7] | | | [added: 59.1 | | |] 47.2 | | | [removed: 39.2] | | | [added: | | | | | |]

| Average Stockholders’ Equity to Average Assets | | | [removed: 8.1] [added: 8.4] | | | [added: 8.1 | | |] 7.3 | | | [removed: 7.5] | | | [added: | | | | | |]

[removed: Trust, Investment and Other Servicing Fees decreased 2% in 2023, as compared to a 2% increase in 2022.][added: TABLE 5: TRUST, INVESTMENT AND OTHER SERVICING FEES]

The increase primarily reflected favorable [removed: markets, net inflows,] [added: markets] and [removed: favorable currency translation.][added: net asset inflows.]

[removed: The] [added: There was a negative] Provision for Credit Losses [removed: in 2023 was $24.5] [added: of $3.0] million [added: in 2024,] as compared to a Provision for Credit Losses of [removed: $12.0] [added: $24.5] million in [removed: 2022.][added: 2023.]

Noninterest Expense [removed: of $5.28 billion in 2023] [added: for 2024] increased [removed: $301.3 million, or 6%,] from [removed: $4.98 billion in 2022,] [added: 2023,] primarily reflecting increased [removed: Other Operating Expense,] [added: Compensation,] Equipment and Software, and [removed: Compensation.][added: Outside Services expense, partially offset by lower Other Operating Expense.]

Please refer to Note [removed: 19, “Other Operating Expense”] [added: 24, “Commitments and Contingent Liabilities”] included under Item 8, “Financial Statements and Supplementary Data,” for additional details related to the [removed: $84.6 million] FDIC special assessment.

The [added: 2024] Provision for Income Taxes [removed: in 2023 totaled $357.5] [added: was $628.4] million, representing an effective [removed: tax] rate of [removed: 24.4%.][added: 23.6%.]

The following information summarizes our consolidated results of operations for [removed: 2023] [added: 2024] compared to [removed: 2022.][added: 2023.]

For a discussion related to the consolidated results of operations for [removed: 2022] [added: 2023] compared to [removed: 2021,] [added: 2022,] refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended December 31, [removed: 2022 (2022] [added: 2023 (2023] Form 10-K), which was filed with the United States Securities and Exchange Commission on February [removed: 28, 2023.][added: 27, 2024.]

Noninterest Income represented [removed: 71%] [added: 74%] and [removed: 72%] [added: 71%] of total revenue in [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] respectively, and totaled [removed: $4.79] [added: $6.1] billion in [removed: 2023,] [added: 2024,] which [removed: decreased $82.5 million,] [added: increased $1.3 billion,] or [removed: 2%,] [added: 28%,] from [removed: $4.87] [added: $4.8] billion in [removed: 2022.][added: 2023.]

[removed: Both losses in] Investment Security Gains (Losses), net [added: reflects $189.3 million of losses] in [removed: 2023 and 2022 were] [added: 2024 as compared to $169.5 million of losses in 2023, both] due to [removed: a repositioning] [added: repositionings] of the available for sale debt securities [removed: portfolio.][added: portfolio in each year.]

Net Interest Income on a fully taxable equivalent (FTE) basis in [removed: 2023] [added: 2024] of [removed: $2.04] [added: $2.2] billion increased [removed: $106.7] [added: $169.4] million, or [removed: 6%,] [added: 8%,] from [removed: $1.93] [added: $2.0] billion in [removed: 2022,] [added: 2023,] primarily due to higher [added: deposits and higher] average interest rates, partially offset by an unfavorable balance sheet mix.

The net interest margin on an FTE basis increased to [removed: 1.56%] [added: 1.64%] in [removed: 2023] [added: 2024] from [removed: 1.39%] [added: 1.56%] in [removed: 2022,] [added: 2023,] primarily due to higher average interest [removed: rates, partially offset by an unfavorable] [added: rates and a favorable] funding mix shift.

Average earning assets [removed: decreased $8.0] [added: increased $3.6] billion, or [removed: 6%,] [added: 3%,] from [removed: $138.8] [added: $130.8] billion in [removed: 2022] [added: 2023] to [removed: $130.8] [added: $134.4] billion in [removed: 2023,] [added: 2024,] primarily due to [removed: lower] [added: higher] client deposits, partially offset by [removed: higher] [added: lower] borrowing activity, the net of which resulted in [removed: lower] [added: higher] funding of earning assets.

TABLE [removed: 5:] [added: 4:] REVENUE

*(1)* Percentage calculations are based on actual balances rather than the rounded amounts presented in the table above.

N/M - Not meaningful

Revenue in 2024 of $8.3 billion increased $1.5 billion, or 22%, from $6.8 billion in 2023, primarily driven by higher Other Operating Income, Trust, Investment and Other Servicing Fees, and Net Interest Income.

Other Operating Income of $1.2 billion in 2024 increased $928.7 million from $228.7 million in the prior year, primarily driven by a $896.7 million gain related to Northern Trust’s participation in an exchange offer related to shares of a class of Visa, Inc. common stock and a $68.1 million gain on the sale of an equity investment, partially offset by mark-to-market activity on existing swap agreements related to shares of a class of Visa, Inc. common stock, including a $12.8 million expense related to litigation escrow funding, as well as losses recognized as a result of a securities repositioning related to the supplemental pension plan and impairment charges taken on certain investments.

Please refer to Note 24, “Commitments and Contingent Liabilities” included under Item 8, “Financial Statements and Supplementary Data,” for additional details related to the exchange offer.

Trust, Investment and Other Servicing Fees of $4.7 billion in 2024 increased $366.0 million, or 8%, from $4.4 billion in 2023, primarily due to favorable markets and net new business.

Investment Management fees increased in 2024 from 2023 primarily due to favorable markets and net new business.

Securities Lending decreased in 2024 from 2023 primarily due to lower spreads.

Other fees increased from the prior-year, primarily due to new business.

Global Family Office fee income increased in 2024 from 2023 primarily due to favorable markets and asset inflows.

Foreign Exchange Trading Income in 2024 increased from 2023, primarily driven by higher trading volumes.

Other Operating Income in 2024 increased from 2023 primarily driven by a $896.7 million gain related to Northern Trust’s participation in an exchange offer related to shares of a class of Visa, Inc. common stock and a $68.1 million gain on the sale of an equity investment, partially offset by mark-to-market activity on existing swap agreements related to shares of a class of Visa, Inc. common stock, including a $12.8 million expense related to litigation escrow funding, as well as losses recognized as a result of a securities repositioning related to the supplemental pension plan and impairment charges taken on certain investments.

| Less: FTE Adjustment | | | $ | 31.8 | | $ | — | | — | | % | $ | 57.5 | | $ | — | | — | | % | $ | 45.6 | | $ | — | | — | | % |

*(9)A reconciliation of Net Interest Income on a GAAP basis to Net Interest Income on an FTE basis is provided in “Supplemental Information—Reconciliation to Fully Taxable Equivalent” within this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section.*

*(2)* *Changes due to average balance and average rate include the impact of balance sheet netting as noted in Table 20: Average Consolidated Balance Sheets with Analysis of Net Interest Income.

Excluding the impact of netting, the 2024 vs. 2023 change in Securities Purchased under Agreements to Resell attributed to the average balance and the average rate would be $1.8 billion and $4.1 million respectively.

The 2023 vs. 2022 change attributed to the average balance and the average rate would be $1.2 billion and $294.9 million respectively.

Excluding the impact of netting, the 2024 vs. 2023 change in Securities Sold under Agreements to Repurchase attributed to the average balance and the average rate would be $1.7 billion and $(3.7) million respectively.

The 2023 vs. 2022 change attributed to the average balance and the average rate would be $1.2 billion and $246.6 million respectively.*

Average Interest-Bearing Deposits increased $8.4 billion, or 10%, to $95.9 billion in 2024 from $87.5 billion in 2023.

The negative provision during 2024 resulted from decreases in both individual and collective reserves.

The decrease in individual reserves was driven by one Commercial loan charge-off.

The decrease in collective reserves was primarily in held to maturity securities driven by methodology changes and improvements in portfolio quality partially offset by an increase in the Commercial Real Estate (CRE) portfolio, driven by deterioration in portfolio quality.

Compensation expense, the largest component of Noninterest Expense, increased in 2024 from 2023, primarily due to higher severance-related charges and an increase to base pay adjustments.

Occupancy expense in 2024 decreased from 2023, primarily due to charges related to early lease exists recorded during the prior-year period.

INFORMATION

Effective January 2024, Northern Trust implemented certain enhancements to its FTP methodology, impacting the allocation of Net Interest Income to the Asset Servicing and Wealth Management segments.

As a result, the approximate impact on the Asset Servicing and Wealth Management segments was a $132.0 million decrease and a $132.0 million increase in Net Interest Income, respectively, for the year ended December 31, 2024.

Prior-year segment results have not been revised to reflect this methodology change.

The following tables reflect the earnings contribution and certain average balances of Northern Trust’s reporting segments for the years ended December 31, 2024, 2023, and 2022.

TABLE 22: RESULTS OF REPORTING SEGMENTS

| ($ In Millions) | | | ASSET SERVICING | | | | | | | | | WEALTH MANAGEMENT | | | | | | | | |

| Revenue(1) | | | 4,367.9 | | | 4,135.6 | | | 4,100.7 | | | 3,212.7 | | | 2,883.8 | | | 2,941.7 | | |

| Compensation | | | 1,016.3 | | | 970.2 | | | 948.5 | | | 578.0 | | | 557.8 | | | 520.4 | | |

| Employee Benefits | | | 201.5 | | | 197.1 | | | 190.7 | | | 87.7 | | | 84.2 | | | 86.8 | | |

| Outside Services | | | 437.0 | | | 449.8 | | | 433.5 | | | 45.2 | | | 41.9 | | | 41.3 | | |

| Allocated Expense | | | 1,660.5 | | | 1,469.5 | | | 1,344.8 | | | 1,202.5 | | | 1,125.4 | | | 1,109.2 | | |

| Other Segment Items(2) | | | 175.4 | | | 186.6 | | | 175.2 | | | 77.6 | | | 73.0 | | | 57.8 | | |

| Average Loans | | | $ | 6,315.5 | | $ | 7,372.6 | | $ | 7,208.0 | | $ | 34,601.2 | | $ | 34,804.4 | | $ | 33,822.6 | |

| Average Deposits | | | $ | 86,775.3 | | $ | 81,812.6 | | $ | 96,166.1 | | $ | 25,558.2 | | $ | 23,432.9 | | $ | 29,426.3 | |

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Net Income decreased $228.7 million, or 17%, to $1.11 billion in 2023 from $1.34 billion in 2022.

Earnings per diluted common share was $5.08 in 2023 compared to $6.14 in 2022.

Return on average common equity decreased to 10.0% in 2023 from 12.7% in 2022.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Revenue increased $12.3 million to $6.77 billion in 2023 from $6.76 billion in the prior year, primarily driven by an increase in Net Interest Income of 5%, partially offset by a decrease in Foreign Exchange Trading Income of 29%.

Client AUC/A increased 13% from $13.60 trillion as of December 31, 2022 to $15.40 trillion as of December 31, 2023, primarily reflecting favorable markets.

Client assets under custody, a component of AUC/A, increased 12% from $10.60 trillion as of December 31, 2022 to $11.92 trillion as of December 31, 2023.

Client assets under custody included $8.01 trillion of global custody assets as of December 31, 2023, which increased 16% from $6.91 trillion as of December 31, 2022.

Client AUM increased 15% to $1.43 trillion as of December 31, 2023 from $1.25 trillion as of December 31, 2022.

For additional information, please refer to Provision for Credit Losses within the “Consolidated Results of Operations” section.

The Provision for Income Taxes in 2022 totaled $430.3 million, representing an effective tax rate of 24.4%.

Northern Trust continued to maintain a strong capital position during 2023, with all capital ratios exceeding those required for classification as “well-capitalized” under federal bank regulatory capital requirements.

For additional information, please refer to the “Capital Management” section.

Revenue in 2023 of $6.77 billion increased $12.3 million from $6.76 billion in 2022.

Noninterest Income in 2023 decreased primarily due to lower Foreign Exchange Trading Income and lower Trust, Investment and Other Servicing Fees, partially offset by lower investment securities losses compared to the prior year and higher Other Operating Income.

Investment Security Gains (Losses), net reflected $169.5 million of losses in 2023 as compared to $214.0 million of losses in 2022.

Other Operating Income of $228.7 million in 2023 increased $37.4 million, or 19%, from $191.3 million in the prior year, primarily due to higher income associated with a market value increase in supplemental compensation plans and higher banking and credit-related services fees.

Trust, Investment and Other Servicing Fees of $4.36 billion in 2023 decreased $70.8 million, or 2%, from $4.43 billion in 2022, primarily due to net asset outflows and unfavorable markets, partially offset by lower money market fee waivers and favorable currency translation.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Northern Trust voluntarily waived $8.8 million of money market fund fees in 2023 and $64.2 million of money market fund fees in 2022.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Investment Management fees in 2023 decreased from 2022 primarily due to asset outflows, partially offset by lower money market fund fee waivers.

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Global Family Office fee income was relatively flat primarily due to unfavorable lagged markets, partially offset by lower money market fund fee waivers and asset inflows.

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Northern Trust Corporation [removed: (Corporation)] [added: (the “Corporation”)] is a leading provider of wealth management, asset servicing, asset management and banking solutions to corporations, institutions, families and individuals.

At December 31, [removed: 2023,] [added: 2024,] the Bank had consolidated assets of [removed: $150.3] [added: $154.9] billion and common bank equity capital of [removed: $11.6] [added: $10.8] billion.

At December 31, [removed: 2023,] [added: 2024,] the Corporation had consolidated total assets of [removed: $150.8] [added: $155.5] billion and stockholders’ equity of [removed: $11.9] [added: $12.8] billion.

Asset Servicing [added: (AS)] is a leading global provider of asset servicing and related services to corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, sovereign wealth funds, and other institutional investors around the globe.

At December 31, [removed: 2023,] [added: 2024,] total Asset Servicing assets under custody/administration (AUC/A), assets under custody, and assets under management (AUM) were [removed: $14.36] [added: $15.6] trillion, [removed: $10.88] [added: $12.2] trillion, and [removed: $1.03] [added: $1.2] trillion, respectively.

Wealth Management [added: (WM)] focuses on high-net-worth individuals and families, business owners, executives, professionals, retirees, and established privately-held businesses in its target markets.

Wealth Management also includes Global Family Office, which provides customized services, including but not limited to: investment [removed: consulting;] [added: management;] global custody; fiduciary; [removed: and] private banking; family office [removed: consulting,] [added: consulting;] and technology [removed: solutions,] [added: solutions] to meet the complex financial and reporting needs of ultra-high-net-worth individuals and family offices across the globe.

Wealth Management is one of the largest providers of advisory services in the United States, with AUC/A, assets under custody, and AUM of [removed: $1.04] [added: $1.1] trillion, [removed: $1.03] [added: $1.1] trillion, and [removed: $402.5] [added: $450.7] billion, respectively, at December 31, [removed: 2023.][added: 2024.]

Wealth Management services are delivered by multidisciplinary teams through a network of offices in 19 U.S. states and Washington, D.C., as well as offices in London, Guernsey, [added: Singapore,] and Abu Dhabi.

As discussed above, Northern Trust managed [removed: $1.43] [added: $1.6] trillion in assets as of December 31, [removed: 2023,] [added: 2024,] including [removed: $1.03] [added: $1.2] trillion for Asset Servicing clients and [removed: $402.5] [added: $450.7] billion for Wealth Management clients.

Northern Trust’s business strategy is to provide [added: exceptional] quality financial services to targeted market segments in which it believes it has a competitive advantage [removed: and favorable growth prospects.][added: to offer clients a unique value proposition.]

Northern Trust is subject to extensive regulation [added: and supervision] under state and federal laws in the United States and in each of the jurisdictions in which it does business.

The Federal Reserve Board has authority to limit the activities that a financial holding company may conduct if any depository institution controlled by the financial [added: holding company is found to no longer be “well-capitalized” and “well-managed” or has not received at least a “satisfactory” rating in its most recent Community Reinvestment Act (CRA) examination.]

In [removed: the summer of] 2023, the U.S. banking regulators proposed a rule that would require banking organizations with $100 billion or more in total assets to comply with long-term debt requirements and clean holding company requirements similar to those that currently apply only to GSIBs.

If adopted, this proposal would require the Corporation and the Bank to each maintain a minimum outstanding eligible long-term debt amount of no less than the greatest of (i) 6% of risk-weighted assets [removed: (RWAs),] [added: (RWA),] (ii) 2.5% of total leverage exposure, and (iii) 3.5% of average total consolidated assets.

In August [removed: 2023,] [added: 2024,] the Federal Reserve Board and FDIC [removed: proposed updated] [added: issued final joint] guidance on resolution planning requirements applicable to the Corporation under Section 165(d).

The Corporation’s next 2024 165(d) plan submission is due to the FDIC and Federal Reserve Board by [removed: March 31,] [added: October 1,] 2025.

In addition, the Bank, as an insured depository institution, is required to submit to the FDIC periodic plans for resolution in the event of its [removed: failure, with the next plan being due for submission on December 1, 2024.][added: failure.]

In [removed: August 2023,] [added: June 2024,] the FDIC [removed: issued] [added: adopted] a [removed: proposed] [added: final] rule that would require covered insured depository institutions, such as the Bank, to submit a full resolution plan to the FDIC every [removed: two] [added: three] years and submit an interim supplement in each year that it is not required to submit a full resolution plan.

The [removed: proposed] [added: final] rule [removed: would also increase] [added: increases] the content requirements for plan submissions and [removed: introduce] [added: introduces] a new credibility standard for the FDIC’s evaluation of resolution plans, which would be enforceable against the covered insured depository institutions.

The United Kingdom (UK) has established a special resolution regime and a resolvability assessment framework overseen by the Bank of England (as the UK resolution authority) with many similar features to the BRRD, which was substantially [removed: incorporated into] [added: retained as part of] UK law following the withdrawal of the UK from the EU.

[added: These requirements involve both company-run and supervisory-run] testing of capital under various scenarios, including baseline and severely adverse scenarios provided by the appropriate banking regulator.

Northern Trust published the results of its most recent company-run stress tests on June 28, [removed: 2023.][added: 2024.]

In [removed: July] 2023, the U.S. banking agencies issued a proposed rule to implement the Basel III endgame agreement for large banks (Basel III Endgame Proposal).

The proposal would introduce a new [removed: measure of RWAs known] [added: method for calculating risk weighted assets, referred to] as [removed: “Expanded Total RWAs” (the] [added: the] expanded risk-based [removed: approach), reflecting new RWA methodologies that generally align] [added: approach, which better aligns] with [removed: changes to] the global Basel Accord adopted by the Basel Committee.

The Bank’s risk-based and leverage capital ratios at December 31, [removed: 2023,] [added: 2024,] were well above the regulatory requirements established by U.S. banking regulators.

TABLE 1: RISK-BASED AND LEVERAGE CAPITAL RATIOS AS OF DECEMBER 31, [removed: 2023][added: 2024]

The results of the [removed: 2023] [added: 2024] DFAST, published by the Federal Reserve Board on June [removed: 28, 2023,] [added: 26, 2024,] resulted in Northern Trust’s stress capital buffer and effective Common Equity Tier 1 capital ratio minimum requirement remaining constant at 2.5% and 7.0%, respectively, for the [removed: 2023] [added: annual] capital plan cycle, which began on October 1, [removed: 2023.][added: 2024 and continues through September 30, 2025.]

As of December 31, [removed: 2023,] [added: 2024,] the Corporation and the Bank were in compliance with applicable LCR requirements.

As of December 31, [removed: 2023,] [added: 2024,] the Corporation and the Bank were in compliance with applicable NSFR requirements.

In addition, [removed: in 2023,] Northern Trust [removed: began] publicly [removed: disclosing] [added: discloses] certain qualitative and quantitative information about its NSFR consistent with the semi-annual disclosure requirements of the Federal Reserve Board’s final rule on U.S. NSFR disclosure.

Certain subsidiaries of the Corporation are subject to the Bank Secrecy Act of 1970, as amended by the USA PATRIOT Act of 2001 and [added: Anti-Money Laundering Act of 2020 and] implemented in the regulation of the federal banking regulators and the Financial Crimes Enforcement Network (FinCEN), which requires banks to comply with anti-money laundering (AML) and financial transparency requirements, such as conducting due diligence, verifying client and beneficial owner identification, and monitoring client transactions and detecting and reporting suspicious activities.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) [removed: administers] and [removed: enforces] U.S. [added: Department of State administer and enforce U.S.] economic sanctions laws and regulations, which prohibit the Corporation and its subsidiaries from engaging in [added: certain transactions and dealings including] business in or with certain jurisdictions and parties that are the target of U.S. economic sanctions, such as organizations and countries suspected of aiding, harboring or engaging in terrorist acts or undermining the sovereignty and territorial integrity of democratic countries.

[removed: If the Corporation or the Bank] finds a sanctioned name or jurisdiction on any transaction, asset or account, the Corporation or the Bank [removed: must] [added: may be required to] reject or block such account or transaction and notify the appropriate authorities.

The FDIC also concurrently maintained the long-term target reserve ratio for the DIF, referred to as the Designated Reserve Ratio, at [removed: 2%] [added: 2.00%] for [removed: 2023.][added: 2024.]

[removed: Under the final rule, the] [added: The] assessment base for the special assessment is equal to an insured depository institution’s estimated uninsured domestic office deposits reported as of December 31, 2022, adjusted to exclude the first $5 billion of uninsured domestic office deposits.

The [removed: final rule provides that the] FDIC will collect the special [added: assessment, over an initial eight-quarter collection period and currently projects that the special] assessment [added: will be collected for an additional two quarters beyond the initial eight-quarter collection period,] at a [removed: quarterly rate of 3.36 basis points over eight quarterly assessment periods,] [added: lower rate,] subject to change depending on any adjustments to the loss estimate, mergers, failures, or amendments to reported estimates of uninsured deposits.

In conjunction with the special assessment, $84.6 million was [removed: recognized as an accrued liability and related expense] [added: recorded to Other Operating Expense] in the fourth quarter of 2023.

The final rule [removed: becomes] [added: was] effective on April 1, 2024, [removed: and] [added: with] the first [removed: collection, including any adjustments as described above, will be] [added: collection for the special assessment] reflected on the invoice for the first quarterly assessment period of 2024, with [removed: the first] [added: a] payment [removed: due on] [added: date of] June 28, 2024.

For purposes of the CRA, the Bank operates under a “wholesale” designation granted by the Federal Reserve Board and fulfills its CRA obligations by making qualified [added: investments for the purposes of community development.]

The Bank Holding Company Act also requires a bank holding company to obtain prior approval from the Federal Reserve Board before it acquires substantially all the assets of any bank, or ownership or control of more than 5% of the voting shares of any bank.

The timing and form of any final rule implementing the long-term debt and clean holding company requirements is uncertain.

The final rule was effective October 1, 2024.

The Bank’s first interim supplement is due July 1, 2025, and its full resolution plan is due July 1, 2026.

The proposed rule has not been finalized and U.S. regulators have indicated their intent to revise and reissue the proposal.

No time table has been provided for the re-proposal or its effective date.

It is uncertain if and when the final rule for Basel III Endgame Proposal will be adopted, and if so, whether it will be finalized as proposed.

The potential impacts on the Corporation and the Bank of a final rule remain uncertain until a final rule is published.

| Northern Trust Corporation | | | 12.4 | | % | 14.5 | | % | 13.3 | | % | 15.6 | | % | 15.1 | | % | 17.4 | | % | 8.1 | | % | 8.1 | | % | 8.9 | | % |

| The Northern Trust Company | | | 11.4 | | % | 13.6 | | % | 11.4 | | % | 13.6 | | % | 12.8 | | % | 15.0 | | % | 6.9 | | % | 6.9 | | % | 7.5 | | % |

The Anti-Money Laundering Act of 2020 includes the Corporate Transparency Act, which requires FinCEN to issue regulations requiring reporting of and access to beneficial ownership information of legal entities and amendments to related customer due diligence requirements for financial institutions.

The applicable rule is subject to litigation which is still pending although various preliminary injunctions have been stayed.

In the meantime, FinCEN has extended the filing deadline by 30 days and signaled its intent to revisit the rule.

Additionally, there is a possibility of legislation that will postpone the deadline to January 1, 2026.

If the Corporation or the Bank

A subsequent reassessment by the FDIC in 2024 resulted in an increase of the assessed amount to $99.3 million and an additional $14.7 million was recorded to Other Operating Expense.

Three quarterly assessments aggregating $31.7 million were paid in 2024.

For more information on the FDIC’s special assessment, please refer to Note 24, “Commitments and Contingent Liabilities” included under Item 8, “Financial Statements and Supplementary Data”.

Several banking industry groups filed a lawsuit seeking to invalidate the CRA final rule, in which they argued that the federal banking agencies exceeded their statutory authority in adopting the CRA final rule.

In March 2024, a federal judge granted an injunction to extend the CRA final rule’s effective date, originally set for April 1, 2024.

The effective date will be extended each day the injunction remains in place, pending the resolution of the lawsuit.

The Data Protection and Digital Information Bill did not become law before Parliament was dissolved on May 24, 2024.

It is possible that it or similar data protection measures will be introduced by the government in the current Parliament.

Northern Trust uses a variety of machine learning and artificial intelligence (“AI”) solutions to process transactional activity more efficiently and to mitigate risk.

These uses currently include, among others, digitizing documents, detecting anomalous, fraudulent transactions and training services teams on operational processes.

Regulation of AI is rapidly evolving in the U.S. and worldwide as legislators and regulators are increasingly focused on these powerful emerging technologies.

The technologies underlying AI and its uses are subject to a variety of laws and regulations, including intellectual property, privacy, data protection, cybersecurity, consumer protection, competition, and equal opportunity laws, and are expected to be subject to increased regulation and new laws or new applications of existing laws and regulations.

Northern Trust has certain processes and controls in place designed to mitigate the risks associated with the use of AI solutions, including monitoring the development and applicability of such evolving laws and regulations, and will take steps designed to comply with laws and regulations applicable to Northern Trust’s use of AI.

In June 2024, the texts of CRR III and CRD VI, were formally published in the Official Journal of the EU.

Through these regulations, the EU will implement the Basel III accord into EU law.

These regulations affect the capital and liquidity requirements of European banking entities and restrict the provision of prescribed core banking services, including lending, the provision of guarantees and commitments, and the taking of deposits or other borrowing, by non-EU entities to EU entities, except where these services are provided through an authorized EU branch or where an exemption applies.

The new regime will be phased in, beginning in 2024 through to 2027.

The new measures, including an anti-greenwashing rule, product labels and product naming and marketing rules, entered into force during the course of 2024.

The text of the Sixth EU Money Laundering Directive was published in June 2024 and EU member states have until 2027 to transpose its requirements into national legislation.

Our talent is our greatest asset and a core enabler of our strategy.

Empowering our employees is central to our talent vision.

THE EMPLOYEE EXPERIENCE

We elevate the employee experience from recruitment to retirement by investing in three core areas: professional development, rewarding performance, and strengthening workforce and operational resiliency.

By fostering an environment where our employees thrive, we ensure that our workforce is fully engaged, motivated, celebrated, and equipped to drive our strategy.

To support this effort, we continue to invest in our Human Capital Management System to streamline manual processes and enable dynamic workforce analytics, helping managers make informed decisions and gain insights into their teams.

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holding company is found to no longer be “well-capitalized” and “well-managed” or has not received at least a “satisfactory” rating in its most recent Community Reinvestment Act (CRA) examination.

The public comment period on this proposed rule ran through January 16, 2024.

These requirements involve both company-run and supervisory-run

The proposal includes a proposed effective date of July 1, 2025, with three-year transition arrangements until revised standards are fully phased in on July 1, 2028.

Based on our current understanding of the proposed rule, we estimate that, if the expanded risk-based approach had applied on a fully phased-in basis as of December 31, 2023, and in the absence of taking any actions to mitigate its impact, our expanded risk-based approach RWAs as of that date would have been approximately 5% to 15% higher than our actual standardized approach RWAs as of that date.

The proposed rule would phase in the higher expanded risk-based approach RWAs on July 1 of each year during the transition, thereby increasing our regulatory capital requirements, with delayed incorporation of the potentially lower stress capital buffer calculations.

| Northern Trust Corporation | | | 11.4 | | % | 13.4 | | % | 12.3 | | % | 14.5 | | % | 14.2 | | % | 16.5 | | % | 8.1 | | % | 8.1 | | % | 8.6 | | % |

| The Northern Trust Company | | | 12.2 | | % | 14.6 | | % | 12.2 | | % | 14.6 | | % | 13.8 | | % | 16.3 | | % | 8.0 | | % | 8.0 | | % | 8.5 | | % |

In September 2022, FinCEN issued a final rule implementing one of three rulemakings planned in connection with the Corporate Transparency Act, which imposes new beneficial ownership information reporting requirements (Beneficial Ownership Reporting Rule).

In order to comply with the Beneficial Ownership Reporting Rule, both domestic reporting companies and foreign reporting companies registered to do business in the United States generally will be required to

report information regarding themselves, their beneficial owners, and their company applicants.

The Beneficial Ownership Reporting Rule became effective January 1, 2024 and may affect certain companies that the Corporation invests in, manages, or does business with.

Additionally, on December 16, 2022, FinCEN published a Notice of Proposed Rulemaking for its second set of rulemakings in connection with the Corporate Transparency Act, which addresses how authorized recipients can access beneficial ownership information that will be reported to FinCEN and may affect certain activities conducted by the Bank.

FinCEN issued the final rule on December 21, 2023, and it became effective on February 20, 2024.

For more information on the FDIC’s special assessment, please see the “Consolidated Results of Operations—Noninterest Expense” included in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

investments for the purposes of community development.

operating restrictions and reputational damage to the financial institution.

In the UK, the Financial

In the UK, the FCA has exercised powers under the BMR to effect the publication of a synthetic LIBOR rate for one-month, three-month and six-month sterling and U.S. Dollar LIBOR (USD LIBOR) beyond their respective dates of cessation.

The new measures will enter into force during the course of 2024.

improve the transmission of information along the chain of intermediaries to facilitate the exercise of shareholder rights.

The success of our company relies heavily on the strength of the people we employ.

Attracting, engaging, developing and retaining Northern Trust talent is critical.

We invest in our employees holistically to continually build a diverse pipeline of future leaders and enable internal professional advancement.

The overview below outlines Northern Trust’s human capital objectives—talent management, total rewards, and diversity, equity and inclusion.

EMPLOYEES

TALENT MANAGEMENT

We pride ourselves in attracting strong talent and have identified the development of our talent as a strategic priority.

Our focus on well-being, diversity, and a culture of trust, care and collaboration contribute to our employer brand.

Sourcing and Recruitment. We target our talent identification, sourcing methods, and recruitment strategies to specific locations using various channels such as job boards, colleges, professional networks, associations and online social networks.

We base hiring decisions on a variety of factors including relevant experience and accomplishments, educational background, professional licensing, and strong evidence of integrity and ethical behavior.

Onboarding. Northern Trust is committed to helping all new hires succeed from day one.

New employees begin their onboarding journey with a comprehensive learning roadmap that orients them to our history, brand, businesses, and culture.

Orientation programs also augment the onboarding experience by providing global, regional, and/or local information along with networking activities to help connect new hires to each other and other colleagues.

Learning and Development. An integrated partnership between our enterprise-wide and functional learning and development teams ensures we deliver holistic training solutions.

Through our online learning portal, Northern Trust University, all employees can access a portfolio of professional and functional training offerings most helpful to their role.

We provide targeted development opportunities for employees transitioning into management and throughout their management and leadership career.

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For the fiscal year ended December 31, [removed: 2023][added: 2024]

The aggregate market value of the registrant’s common stock as of June [removed: 30, 2023] [added: 28, 2024] (the last business day of the registrant’s most recently completed second [added: fiscal] quarter), based upon the last sale price of the common stock at June [removed: 30, 2023] [added: 28, 2024] as reported by The NASDAQ Stock Market LLC, held by non-affiliates was approximately [removed: $15.3] [added: $16.6] billion.

At January 31, [removed: 2024, 204,841,515] [added: 2025, 195,697,744] shares of common stock, $1.66 2/3 par value, were outstanding.

Portions of the registrant’s Proxy Statement for its [removed: 2024] [added: 2025] Annual Meeting of Stockholders are incorporated by reference into Part III hereof.

| Item 1 | | | [removed: [Business](#i72d41da92e9f4b11ad832cd04d8bb3f6_16)] [added: [Business](#i5c901cf0071c474eba1bb9db16f95068_16)] | | | [removed: [1](#i72d41da92e9f4b11ad832cd04d8bb3f6_16)] [added: [1](#i5c901cf0071c474eba1bb9db16f95068_16)] | | |

| Item 1A | | | [Risk [removed: Factors](#i72d41da92e9f4b11ad832cd04d8bb3f6_19)] [added: Factors](#i5c901cf0071c474eba1bb9db16f95068_19)] | | | [removed: [14](#i72d41da92e9f4b11ad832cd04d8bb3f6_19)] [added: [13](#i5c901cf0071c474eba1bb9db16f95068_19)] | | |

| Item 1B | | | [Unresolved Staff [removed: Comments](#i72d41da92e9f4b11ad832cd04d8bb3f6_22)] [added: Comments](#i5c901cf0071c474eba1bb9db16f95068_22)] | | | [removed: [32](#i72d41da92e9f4b11ad832cd04d8bb3f6_22)] [added: [32](#i5c901cf0071c474eba1bb9db16f95068_22)] | | |

| Item 1C | | | [removed: [Cybersecurity](#i72d41da92e9f4b11ad832cd04d8bb3f6_25)] [added: [Cybersecurity](#i5c901cf0071c474eba1bb9db16f95068_25)] | | | [removed: [33](#i72d41da92e9f4b11ad832cd04d8bb3f6_25)] [added: [32](#i5c901cf0071c474eba1bb9db16f95068_25)] | | |

| Item 2 | | | [removed: [Properties](#i72d41da92e9f4b11ad832cd04d8bb3f6_28)] [added: [Properties](#i5c901cf0071c474eba1bb9db16f95068_28)] | | | [removed: [34](#i72d41da92e9f4b11ad832cd04d8bb3f6_28)] [added: [33](#i5c901cf0071c474eba1bb9db16f95068_28)] | | |

| Item 3 | | | [Legal [removed: Proceedings](#i72d41da92e9f4b11ad832cd04d8bb3f6_31)] [added: Proceedings](#i5c901cf0071c474eba1bb9db16f95068_31)] | | | [removed: [34](#i72d41da92e9f4b11ad832cd04d8bb3f6_31)] [added: [33](#i5c901cf0071c474eba1bb9db16f95068_31)] | | |

| Item 4 | | | [Mine Safety [removed: Disclosures](#i72d41da92e9f4b11ad832cd04d8bb3f6_34)] [added: Disclosures](#i5c901cf0071c474eba1bb9db16f95068_34)] | | | [removed: [34](#i72d41da92e9f4b11ad832cd04d8bb3f6_34)] [added: [34](#i5c901cf0071c474eba1bb9db16f95068_34)] | | |

| Supplemental Item | | | [Information About Our Executive [removed: Officers](#i72d41da92e9f4b11ad832cd04d8bb3f6_37)] [added: Officers](#i5c901cf0071c474eba1bb9db16f95068_37)] | | | [removed: [35](#i72d41da92e9f4b11ad832cd04d8bb3f6_37)] [added: [34](#i5c901cf0071c474eba1bb9db16f95068_37)] | | |

| Item 5 | | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i72d41da92e9f4b11ad832cd04d8bb3f6_43)] [added: Securities](#i5c901cf0071c474eba1bb9db16f95068_43)] | | | [removed: [37](#i72d41da92e9f4b11ad832cd04d8bb3f6_43)] [added: [36](#i5c901cf0071c474eba1bb9db16f95068_43)] | | |

| Item 6 | | | [removed: [Reserved](#i72d41da92e9f4b11ad832cd04d8bb3f6_46)] [added: [Reserved](#i5c901cf0071c474eba1bb9db16f95068_46)] | | | [removed: [38](#i72d41da92e9f4b11ad832cd04d8bb3f6_46)] [added: [37](#i5c901cf0071c474eba1bb9db16f95068_46)] | | |

| Item 7 | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i72d41da92e9f4b11ad832cd04d8bb3f6_49)] [added: Operations](#i5c901cf0071c474eba1bb9db16f95068_49)] | | | [removed: [39](#i72d41da92e9f4b11ad832cd04d8bb3f6_49)] [added: [38](#i5c901cf0071c474eba1bb9db16f95068_49)] | | |

| Item 7A | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#i72d41da92e9f4b11ad832cd04d8bb3f6_106)] [added: Risk](#i5c901cf0071c474eba1bb9db16f95068_103)] | | | [removed: [95](#i72d41da92e9f4b11ad832cd04d8bb3f6_106)] [added: [90](#i5c901cf0071c474eba1bb9db16f95068_103)] | | |

| Item 8 | | | [Financial Statements and Supplementary [removed: Data](#i72d41da92e9f4b11ad832cd04d8bb3f6_109)] [added: Data](#i5c901cf0071c474eba1bb9db16f95068_106)] | | | [removed: [95](#i72d41da92e9f4b11ad832cd04d8bb3f6_109)] [added: [91](#i5c901cf0071c474eba1bb9db16f95068_106)] | | |

| Item 9 | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#i72d41da92e9f4b11ad832cd04d8bb3f6_238)] [added: Disclosure](#i5c901cf0071c474eba1bb9db16f95068_238)] | | | [removed: [172](#i72d41da92e9f4b11ad832cd04d8bb3f6_238)] [added: [169](#i5c901cf0071c474eba1bb9db16f95068_238)] | | |

| Item 9A | | | [Controls and [removed: Procedures](#i72d41da92e9f4b11ad832cd04d8bb3f6_241)] [added: Procedures](#i5c901cf0071c474eba1bb9db16f95068_241)] | | | [removed: [172](#i72d41da92e9f4b11ad832cd04d8bb3f6_241)] [added: [169](#i5c901cf0071c474eba1bb9db16f95068_241)] | | |

| Item 9B | | | [Other [removed: Information](#i72d41da92e9f4b11ad832cd04d8bb3f6_244)] [added: Information](#i5c901cf0071c474eba1bb9db16f95068_244)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_244)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_244)] | | |

| Item 9C | | | [Disclosure Regarding Foreign Jurisdictions that Prevent [removed: Inspections](#i72d41da92e9f4b11ad832cd04d8bb3f6_247)] [added: Inspections](#i5c901cf0071c474eba1bb9db16f95068_247)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_247)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_247)] | | |

| [PART [removed: III](#i72d41da92e9f4b11ad832cd04d8bb3f6_250)] [added: III](#i5c901cf0071c474eba1bb9db16f95068_250)] | | | | | | | | |

| Item 10 | | | [Directors, Executive Officers and Corporate [removed: Governance](#i72d41da92e9f4b11ad832cd04d8bb3f6_253)] [added: Governance](#i5c901cf0071c474eba1bb9db16f95068_253)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_253)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_253)] | | |

| Item 11 | | | [Executive [removed: Compensation](#i72d41da92e9f4b11ad832cd04d8bb3f6_256)] [added: Compensation](#i5c901cf0071c474eba1bb9db16f95068_256)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_256)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_256)] | | |

| Item 12 | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i72d41da92e9f4b11ad832cd04d8bb3f6_259)] [added: Matters](#i5c901cf0071c474eba1bb9db16f95068_259)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_259)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_259)] | | |

| Item 13 | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i72d41da92e9f4b11ad832cd04d8bb3f6_262)] [added: Independence](#i5c901cf0071c474eba1bb9db16f95068_262)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_262)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_262)] | | |

| Item 14 | | | [Principal Accountant Fees and [removed: Services](#i72d41da92e9f4b11ad832cd04d8bb3f6_265)] [added: Services](#i5c901cf0071c474eba1bb9db16f95068_265)] | | | [removed: [174](#i72d41da92e9f4b11ad832cd04d8bb3f6_265)] [added: [171](#i5c901cf0071c474eba1bb9db16f95068_265)] | | |

| [PART [removed: IV](#i72d41da92e9f4b11ad832cd04d8bb3f6_268)] [added: IV](#i5c901cf0071c474eba1bb9db16f95068_268)] | | | | | | | | |

| Item 15 | | | [Exhibits and Financial Statement [removed: Schedules](#i72d41da92e9f4b11ad832cd04d8bb3f6_271)] [added: Schedules](#i5c901cf0071c474eba1bb9db16f95068_271)] | | | [removed: [175](#i72d41da92e9f4b11ad832cd04d8bb3f6_271)] [added: [172](#i5c901cf0071c474eba1bb9db16f95068_271)] | | |

| Item 16 | | | [Form 10-K [removed: Summary](#i72d41da92e9f4b11ad832cd04d8bb3f6_274)] [added: Summary](#i5c901cf0071c474eba1bb9db16f95068_274)] | | | [removed: [178](#i72d41da92e9f4b11ad832cd04d8bb3f6_274)] [added: [175](#i5c901cf0071c474eba1bb9db16f95068_274)] | | |

| | | | [removed: 2023] [added: 2024] ANNUAL REPORT \| NORTHERN TRUST CORPORATION i | | |

| ii [removed: 2023] [added: 2024] ANNUAL REPORT \| NORTHERN TRUST CORPORATION | | | | | |

| | | | [removed: 2023] [added: 2024] ANNUAL REPORT \| NORTHERN TRUST CORPORATION iii | | |

| iv [removed: 2023] [added: 2024] ANNUAL REPORT \| NORTHERN TRUST CORPORATION | | | | | |

| [PART I](#i5c901cf0071c474eba1bb9db16f95068_13) | | | | | | | | |

| [PART II](#i5c901cf0071c474eba1bb9db16f95068_40) | | | | | | | | |

| [Signatures](#i5c901cf0071c474eba1bb9db16f95068_277) | | | | | | [176](#i5c901cf0071c474eba1bb9db16f95068_277) | | |

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| | | | | | |

| LTV | | | Loan-to-Collateral Value | | |

| | | | | | |

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| | | | | | |

| | | | | | |

| [PART I](#i72d41da92e9f4b11ad832cd04d8bb3f6_13) | | | | | | | | |

| [PART II](#i72d41da92e9f4b11ad832cd04d8bb3f6_40) | | | | | | | | |

| [Signatures](#i72d41da92e9f4b11ad832cd04d8bb3f6_277) | | | | | | [179](#i72d41da92e9f4b11ad832cd04d8bb3f6_277) | | |

| CDFIs | | | Community Development Financial Institutions | | |

| DE&I | | | Diversity, Equity, and Inclusion | | |

| GILTI | | | Global Intangible Low-Taxed Income | | |

| IBA | | | ICE Benchmark Administration | | |

| NFTS | | | Northern Trust Fiduciary Services (Guernsey) Limited | | |

| TDR | | | Troubled Debt Restructuring | | |

| USD LIBOR | | | U.S. Dollar LIBOR | | |

| WRC | | | Workforce Risk Committee | | |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

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Northern Trust understands the importance of managing cybersecurity risk to ensure the safety and security of our [removed: data] [added: data, network] and systems.

The Business Risk [removed: Committee of the Board of Directors (Business Risk Committee),] [added: Committee,] which reports regularly to the Board, oversees management’s actions to identify, assess, mitigate and remediate material issues related to cybersecurity and technology risk as part of our enterprise risk management program and processes.

The Cybersecurity Risk Oversight [removed: Subcommittee,] [added: Subcommittee of the Business Risk Committee,] chaired by the former chief information officer and chief transformation officer of a Fortune 50 company, assists the Business Risk Committee in discharging its oversight duties with respect to cybersecurity risk and meets on a regular basis to provide for an even deeper focus on, and governance framework around, cybersecurity risks inherent in the Corporation’s business.

The Business Risk Committee, Cybersecurity Risk Oversight Subcommittee, and the Board are regularly briefed on the organization’s cybersecurity posture by senior management, including the Chief Executive Officer, Chief Information Officer (CIO), Chief Risk Officer, Head of Non-Financial [removed: Risk] [added: Risk, Head of Cyber] and [removed: Chief Information Risk Officer (CIRO),] [added: Technology Risk,] and [removed: Chief Information Security Officer (CISO).][added: CISO.]

[removed: The CISO, a Certified Information Systems Security Professional (CISSP) with nearly 30 years of relevant experience,] [added: management and information security,] reports to the CIO and is responsible for identifying, managing, and, if necessary, remediating cybersecurity risk to ensure the protection of our data, network, and systems.

The primary management-level committees responsible for assessing and managing cybersecurity risk are the Information Technology Oversight Committee, chaired by the CIO, who has over 20 years of experience in technology leadership roles, and the Information Technology Risk Committee, chaired by the [removed: CIRO,] [added: Head of Cyber and Technology Risk,] who has over 20 years of cybersecurity and risk management experience.

Northern Trust’s cybersecurity and technology risk management program provides the overall structure for [added: identifying, assessing and] managing the respective risks in a sustainable manner supported by an organizational structure that reflects support from executive management and includes risk committees comprised of members from across the business.

The program is supported by the Cyber and Technology Risk Management Policy [removed: and Framework] approved by the Business Risk Committee.

The Cyber and Technology Risk Management Policy and Framework are based on the National Institute of Standards and Technology (NIST) Cybersecurity Framework and [added: Cyber Risk Institute (CRI) Profile and] provide a comprehensive overview of cybersecurity and technology risk management governance activities pertaining to the confidentiality of information, integrity of systems, data and processes, and the availability of business functions that may be adversely impacted.

These governance processes, internal controls, and risk management practices, which are part of our enterprise risk management program and processes, are designed to keep risk at levels appropriate to Northern Trust’s overall [added: cyber] risk appetite and the inherent risk in the markets in which Northern Trust operates.

Northern Trust employees are responsible for promoting cybersecurity [added: best practices] as well as adhering to applicable policies and standards to safeguard data and business systems.

In cases where Northern Trust relies on [added: third-party] vendors to perform services, controls are routinely reviewed for alignment with industry standards and their ability to protect [removed: information.][added: information in accordance with Northern Trust’s Third-Party Risk Management Program.]

In addition to the cybersecurity controls managed and monitored within the organization, Northern Trust uses external third-party security teams on a regular basis to assess [added: the] effectiveness of our cybersecurity program and controls.

[removed: This] [added: The] center aggregates security threat information from systems and platforms across the business and alerts the organization in accordance with its documented Cybersecurity Incident Response Plan.

A cybersecurity incident [added: starts with malicious intent and] can include, but is not limited to, disruptions of service, denials-of-service, compromises of information systems, data exfiltration or data corruption.

The [removed: plan provides a streamlined approach that] [added: plans] can be invoked rapidly to address matters that raise enterprise concern and to communicate impact, actions, and status to senior management, including the [removed: CISO, CIRO,] [added: Chief Information Security Officer (CISO),] and appropriate [removed: stakeholders.][added: stakeholders, including escalation to appropriate Board-level governance committees, and is reviewed, tested, and updated regularly.]

For more information about these risks, [removed: see,] [added: see] “Breaches of our security measures, including, but not limited to, those resulting from cyber-attacks or other information security incidents, may result in losses,” in Item 1A, “Risk Factors.”

Risk management and strategy

Our cybersecurity program is regularly assessed by Audit Services through various assurance activities, with the results reported to the Audit Committee of the Board of Directors (Audit Committee), and by the Non-Financial Risk team, with the results reported to the Business Risk Committee of the Board of Directors (Business Risk Committee).

Annually, certain elements of the cybersecurity program are subject to an audit by an independent consultant, as well as an assessment by a separate, independent third party, the results of which, including opportunities identified for improvement and related remediation plans, are reviewed with the Board.

Our cybersecurity program is also examined regularly by the Corporation’s prudential and conduct regulators within the scope of their jurisdiction.

The plan provides a streamlined approach that includes enterprise-level response plans.

Governance

The CISO has over 20 years of experience leading teams at financial institutions, including in the areas of risk

Any findings identified are remediated following a risk-based approach.

The plan design includes enterprise-level response plans, including escalation to appropriate Board-level governance committees, and is reviewed, tested, and updated regularly.

Adjacent to this building is one office building in which the Bank leases space principally for [removed: corporate support functions.][added: the asset management business.]

Additional support and operations activity originates from [removed: four] [added: two] facilities in India, one facility in Ireland, and one facility in the Philippines, all of which are leased.

O’Grady - Mr. O’Grady, age [removed: 58,] [added: 59,] joined Northern Trust in 2011 and has served as Chairman of the Board since 2019, as Chief Executive Officer since 2018 and as President since 2017.

Cherecwich - Mr. Cherecwich, age [removed: 59,] [added: 60,] joined Northern Trust in 2007 and has served as Executive Vice President and [removed: President of Asset Servicing] [added: Chief Operating Officer] since [removed: 2017.][added: October 2024.]

Prior to that, Mr. Cherecwich served as [removed: Executive Vice] President [removed: and] [added: of Asset Servicing since 2017, as] President of Global Fund Services from 2010 to 2017 and as Chief Operating Officer of Corporate & Institutional Services from 2008 to 2014.

Gamba - Mr. Gamba, age [removed: 56,] [added: 57,] joined Northern Trust as Executive Vice President and President of Asset Management in April 2023.

Fradkin - Mr. Fradkin, age [removed: 62,] [added: 63,] joined Northern Trust in 1985 and has served as Executive Vice President and [removed: President of Wealth Management] [added: Vice Chairman] since [removed: 2014.][added: October 2024.]

Prior to that, Mr. Fradkin served as President of [added: Wealth Management since 2014, and as President of] Corporate & Institutional Services from 2009 to 2014.

Gossett - Mr. Gossett, age [removed: 62,] [added: 63,] joined Northern Trust in 1983 and has served as Executive Vice President and Chief Risk Officer since 2020.

Karpinski - Ms. Karpinski, age [removed: 61,] [added: 62,] joined Northern Trust in 2006 and has served as Executive Vice President since 2016 and as Global Head of Regulatory Affairs since December 2023.

Landers - Mr. Landers, age [removed: 51,] [added: 52,] joined Northern Trust in 2003 and has served as [removed: a Senior] [added: Executive] Vice President [added: since December 2024] and as Controller since December 2023.

Levy - Ms. Levy, age [removed: 66,] [added: 67,] joined Northern Trust in 2014 and has served as Executive Vice President and General Counsel since that time.

[removed: Parker] [added: Bellows] - [removed: Ms. Parker,] [added: Mr. Bellows,] age [removed: 63,] [added: 61,] joined Northern Trust in [removed: 1982] [added: 2011] and has served as Executive Vice President and President of Europe, Middle East and Africa since [removed: 2017.][added: June 2024.]

Prior to that, Ms. Parker served as [added: President of Europe, Middle East and Africa since 2017 and as] Chief Operating Officer of Corporate & Institutional Services from 2014 to 2017.

South - Mr. South, age [removed: 54,] [added: 55,] joined Northern Trust in 1999 and has served as Executive Vice President and Chief Information Officer since 2018.

Alexandria Taylor - Ms. Taylor, age [removed: 41,] [added: 42,] joined Northern Trust [added: in 2022 and has served] as Executive Vice President and Chief [removed: Human Resources] [added: Administrative] Officer [removed: in 2022.][added: since October 2024.]

[removed: Prior to] [added: Before] joining Northern Trust, Ms. Taylor spent nearly two decades at Bank of America based in New York City where she was the head of Human Resources for corporate, institutional and wealth management businesses.

[removed: Tyler] [added: Fox, Jr.] - Mr. [removed: Tyler,] [added: Fox,] age [removed: 52,] [added: 65,] joined Northern Trust in [removed: 2011] [added: 2012] and has served as Executive Vice President and Chief Financial Officer since [removed: 2020.][added: October 2024.]

Prior to that, Mr. Tyler served as Chief Financial Officer [added: since 2020, as Chief Financial Officer] of Wealth Management from 2018 to 2019, as Global Head of Asset Management’s Institutional Group from 2014 to 2018, and as Global Head of Strategy from 2011 to 2014.

Clive A.

Prior to that, Mr. Bellows served as Head of Global Fund Services for Europe, Middle East and Africa from 2016 to June 2024.

Before joining Northern Trust in 2011, Mr. Bellows served as Managing Director and Head of Relationship Management for Asset Managers and Hedge Funds at JPMorgan Chase & Co. from 2006 to 2011 and as Executive Director and Global Head of Client Service, Global Markets at Deutsche Bank AG from 2004 to 2006.

Mr. Bellows also served as Head of Relationship Management for the Global Fund Services and Investment Manager Liaison Group at Northern Trust from 1997 to 2003.

Kelley A.

Conway - Ms. Conway, age 51, joined Northern Trust in 2021 and has served as Executive Vice President and Head of Strategic Change, Data and Digital since October 2024.

Prior to that, Ms. Conway served as Executive Vice President and Head of Corporate and Digital Strategy.

Prior to joining Northern Trust, Ms. Conway led the Financial Services Technology Advisory practice in North America and Global Capital Markets Applied Intelligence Practice at Accenture, where she had been employed since 2017.

David W.

Prior to that, Mr. Fox served as Executive Vice President and President of the Global Family & Private Investment Offices Group from July 2015 through September 2024 and as Executive Vice President and Head of the Americas, Corporate & Institutional Services from May 2012 to June 2015.

Before joining Northern Trust, Mr. Fox served in various leadership roles with J.P.Morgan.

Parker - Ms. Parker, age 64, joined Northern Trust in 1982 and has served as Executive Vice President and President of Asset Servicing since October 2024.

Prior to that, she served as Chief Human Resources Officer.

Tyler - Mr. Tyler, age 53, joined Northern Trust in 2011 and has served as Executive Vice President and President of Wealth Management since October 2024.

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Our common stock is listed on The NASDAQ Stock Market LLC under the symbol “NTRS.” There were [removed: 1,474] [added: 1,417] stockholders of record as of January 31, [removed: 2024.][added: 2025.]

The following table shows certain information relating to the Corporation’s purchases of common stock [added: through our share repurchase program] for the three months ended December 31, [removed: 2023.][added: 2024.]

TABLE [removed: 3:] [added: 2:] REPURCHASES OF COMMON STOCK IN THE FOURTH QUARTER OF [removed: 2023][added: 2024]

The following graph compares the cumulative total stockholder return on the Corporation’s common stock to the cumulative total return of the S&P 500 Index and the KBW Bank Index for the five fiscal years ended December 31, [removed: 2023.][added: 2024.]

The cumulative total stockholder return assumes the investment of $100 in the Corporation’s common stock and in each index on December 31, [removed: 2018] [added: 2019] and assumes reinvestment of dividends.

Total Return Assumes $100 Invested on December 31, [removed: 2018] [added: 2019] with Reinvestment of Dividends

[removed: ][added: ]

| | | | [removed: 2018 | | |] 2019 | | | 2020 | | | 2021 | | | 2022 | | | [removed: 2023] [added: 2023] | | | [added: 2024 | | |]

| Northern Trust | | | $ | 100 | | $ | [removed: 131] [added: 91] | | $ | 119 | | $ | [removed: 156] [added: 91] | | $ | [removed: 119] [added: 90] | | $ | [removed: 118] [added: 113] | |

| KBW Bank Index | | | 100 | | | [removed: 136] [added: 90] | | | [removed: 122] [added: 124] | | | [removed: 169] [added: 98] | | | [removed: 133] [added: 97] | | | [removed: 132] [added: 133] | | |

| October 1 - 31, 2024 | | | 223,867 | | | $ | 101.85 | | 223,867 | | | 13,076,283 | | |

| November 1 - 30, 2024 | | | 1,259,715 | | | 106.36 | | | 1,259,715 | | | 11,816,568 | | |

| December 1 - 31, 2024 | | | 867,740 | | | 108.45 | | | 867,740 | | | 10,948,828 | | |

| Total (Fourth Quarter) | | | 2,351,322 | | | $ | 106.70 | | 2,351,322 | | | 10,948,828 | | |

| S&P 500 Index | | | 100 | | | 118 | | | 152 | | | 125 | | | 158 | | | 197 | | |

| October 1 - 31, 2023 | | | 316,100 | | | $ | 64.51 | | 316,100 | | | 22,613,252 | | |

| November 1 - 30, 2023 | | | 1,010,300 | | | 74.21 | | | 1,010,300 | | | 21,602,952 | | |

| December 1 - 31, 2023 | | | 609,500 | | | 80.68 | | | 609,500 | | | 20,993,452 | | |

| Total (Fourth Quarter) | | | 1,935,900 | | | $ | 74.66 | | 1,935,900 | | | 20,993,452 | | |

| S&P 500 Index | | | 100 | | | 131 | | | 156 | | | 200 | | | 164 | | | 207 | | |

We have audited the accompanying consolidated balance sheets of Northern Trust Corporation and subsidiaries (the Corporation) as of December 31, [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2023,] [added: 2024,] and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Corporation as of December 31, [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2023,] [added: 2024,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Corporation’s internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] based on criteria established in *Internal Control – Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February [removed: 27, 2024] [added: 24, 2025] expressed an unqualified opinion on the effectiveness of the Corporation’s internal control over financial reporting.

As discussed in Notes 1 and 6 to the consolidated financial statements, the Corporation’s allowance for credit losses for commercial loans evaluated on a collective basis (the collective ACL) was [removed: $135.4] [added: $137.3] million of a total allowance for credit losses assigned to loans of [removed: $178.7] [added: $168.0] million as of December 31, [removed: 2023.][added: 2024.]

The quantitative allowance is then reviewed within the qualitative adjustment framework, through which the Corporation applies judgment by assessing internal risk factors, potential limitations in the quantitative methodology, and [removed: environmental] [added: other] factors that are not fully contemplated in the forecast to compute adjustments to the quantitative allowance that may impact individual or multiple segments of the loan portfolio.

[removed: ][added: ]

| (In Millions Except Share Information) | | | [removed: 2023] [added: 2024] | | | [added: 2023 | | |] 2022 | | |

| Cash and Due from Banks | | | [removed: $] [added: $] | [removed: 4,791.5] [added: 4,791.5] | | $ | [removed: 4,654.2] [added: 4,791.5] | | [added: $ | 4,791.5 | | $ | — | | $ | — | |]

| Federal Reserve and Other Central Bank Deposits | | | [removed: 34,326.2] [added: 34,326.2] | | | [removed: 40,030.4] [added: 34,326.2] | | | [added: — | | | 34,326.2 | | | — | | |]

| Interest-Bearing Deposits with Banks | | | [removed: 1,939.0] [added: 1,939.0] | | | [removed: 1,941.1] [added: 1,939.0] | | | [added: — | | | 1,939.0 | | | — | | |]

| [added: Change in] Federal Funds Sold | | | [removed: —] [added: (25.0)] | | | 32.0 | | | [added: (32.0) | | |]

| Securities Purchased under Agreements to Resell | | | [removed: 784.7] [added: 784.7] | | | [removed: 1,070.3] [added: 784.7] | | | [added: — | | | 784.7 | | | — | | |]

| Available for Sale (Amortized cost of [removed: $23,659.0] [added: $29,229.1] and [removed: $27,760.0)] [added: $23,659.0)] | | | [removed: 23,089.8] [added: 29,001.5] | | | [removed: 26,699.9] [added: 23,089.8] | | |

| Held to Maturity (Fair value of [removed: $24,473.0] [added: $20,654.5] and [removed: $22,879.3)] [added: $24,473.0)] | | | [removed: 26,221.7] [added: 22,296.7] | | | [removed: 25,036.1] [added: 26,221.7] | | |

| Total Debt Securities | | | [removed: 49,311.5] [added: 51,298.2] | | | [removed: 51,831.2] [added: 49,311.5] | | |

| Commercial | | | [removed: 25,412.8] [added: 20,278.8] | | | [removed: 21,635.6] [added: 25,412.8] | | |

| Personal | | | [removed: 22,204.2] [added: 23,111.8] | | | [removed: 21,257.7] [added: 22,204.2] | | |

| Total Loans (Net of unearned income of [removed: $5.9] [added: $6.3] and [removed: $9.0)] [added: $5.9)] | | | [removed: 47,617.0] [added: 43,390.6] | | | [removed: 42,893.3] [added: 47,617.0] | | |

| Allowance for Credit Losses | | | [removed: (192.3)] [added: (175.5)] | | | [removed: (161.1)] [added: (192.3)] | | |

| Buildings and Equipment | | | [removed: 502.2] [added: 490.3] | | | [removed: 500.5] [added: 502.2] | | |

| Client Security Settlement Receivables | | | [removed: 212.6] [added: 41.1] | | | [removed: 1,698.3] [added: 212.6] | | |

| Goodwill | | | [removed: 702.3] [added: 694.9] | | | [removed: 691.3] [added: 702.3] | | |

| Other Assets | | | [removed: 10,788.4] [added: 13,920.5] | | | [removed: 9,855.2] [added: 10,788.4] | | |

| Total Assets | | | $ | [removed: 150,783.1] [added: 155,508.4] | | $ | [removed: 155,036.7] [added: 150,783.1] | |

| Demand and Other Noninterest-Bearing | | | $ | [removed: 14,246.4] [added: 14,325.6] | | $ | [removed: 16,582.7] [added: 14,246.4] | |

| Savings, Money Market and Other Interest-Bearing | | | [removed: 25,252.1] [added: 26,122.6] | | | [removed: 31,128.6] [added: 25,252.1] | | |

| Savings Certificates and Other Time | | | [removed: 4,109.7] [added: 5,731.7] | | | [removed: 1,981.3] [added: 4,109.7] | | |

| Non U.S. Offices — Noninterest-Bearing | | | [removed: 8,584.7] [added: 10,027.9] | | | [removed: 8,757.6] [added: 8,584.7] | | |

| — Interest-Bearing | | | [removed: 63,971.1] [added: 66,274.9] | | | [removed: 65,481.9] [added: 63,971.1] | | |

| Total Deposits | | | [removed: 116,164.0] [added: 122,482.7] | | | [removed: 123,932.1] [added: 116,164.0] | | |

| Federal Funds Purchased | | | [removed: 3,045.4] [added: 3,045.4] | | | [removed: 1,896.9] [added: 3,045.4] | | | [added: — | | | 3,045.4 | | | — | | |]

| Securities Sold Under Agreements to Repurchase | | | [removed: 784.7] [added: 784.7] | | | [removed: 567.2] [added: 784.7] | | | [added: — | | | 784.7 | | | — | | |]

| Other Borrowings | | | [removed: 6,567.8] [added: 6,521.0] | | | [removed: 7,592.3] [added: 6,567.8] | | |

| Senior Notes | | | [removed: 2,773.2] [added: 2,769.7] | | | [removed: 2,724.2] [added: 2,773.2] | | |

| Long-Term Debt | | | [removed: 4,065.0] [added: 4,081.3] | | | [removed: 2,066.2] [added: 4,065.0] | | |

| Other Liabilities | | | [removed: 5,485.1] [added: 4,243.8] | | | [removed: 4,998.3] [added: 5,485.1] | | |

| Total Liabilities | | | [removed: 138,885.2] [added: 142,720.0] | | | [removed: 143,777.2] [added: 138,885.2] | | |

| Common Stock, $1.66 2/3 Par Value; Authorized 560,000,000 shares; Outstanding shares of [removed: 205,126,224] [added: 195,969,746] and [removed: 208,428,309] [added: 205,126,224] | | | 408.6 | | | 408.6 | | |

| Additional Paid-In Capital | | | [removed: 1,009.6] [added: 1,025.3] | | | [removed: 983.5] [added: 1,009.6] | | |

| Retained Earnings | | | [removed: 14,233.8] [added: 15,614.7] | | | [removed: 13,798.5] [added: 14,233.8] | | |

February 24, 2025

| Excise Tax on Share Repurchases | | | — | | | — | | | — | | | — | | | — | | | (8.4) | | | (8.4) | | |

| Balance at December 31, 2024 | | | $ | 884.9 | | $ | 408.6 | | $ | 1,025.3 | | $ | 15,614.7 | | $ | (814.0) | | $ | (4,331.1) | | $ | 12,788.4 | |

| Proceeds from the sale of Visa Shares | | | 800.6 | | | — | | | — | | |

| Reclassification of certain cash collateral received from Other Operating Activities to Deposits(1) | | | 1,157.2 | | | — | | | — | | |

*(1 )Beginning January 1, 2024, Northern Trust reclassified certain cash collateral received from Other Liabilities to Deposits on the consolidated statement of financial condition.

Prior periods have not been restated.*

expected to result in debt repayment or restoration to a current status in the near future).

These evaluations are based on expected future cash flows, the value of collateral, and other factors that may impact the borrowers’ ability to pay.

Actual losses may vary from current estimates.

It is Northern Trust’s policy to release income tax effects from accumulated other comprehensive income on an aggregate portfolio basis.

The expense for share-based compensation is included in Compensation on the consolidated statements of income.

On January 1, 2024, Northern Trust adopted Accounting Standards Update (ASU) No. 2023-02, “Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method—a consensus of the Emerging Issues Task Force” (ASU 2023-02).

The amendments in ASU 2023-02 allow entities to elect the proportional amortization method to account for tax equity investments if certain conditions are met regardless of the tax credit program from which the income tax credits are received.

Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the income tax credits and other income tax benefits received and recognizes the net amortization and income tax credits and other income tax benefits in the income statement as a component of income tax expense (benefit).

In addition, ASU 2023-02 requires specific disclosures that must be applied to all investments that generate income tax credits and other income tax benefits for which the entity has elected to apply the proportional amortization method in accordance with Subtopic 323-740.

Please refer to Note 28 - Variable Interest Entities for further information

On January 1, 2024, Northern Trust adopted ASU No. 2022-03, “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions” (ASU 2022-03).

The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

ASU 2022-03 also clarifies that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction.

Additionally, ASU 2022-03 introduces new disclosure requirements to provide investors with information about contractual sale restrictions including the nature and remaining duration of these restrictions.

On December 31, 2024, Northern Trust adopted ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (ASU 2023-07).

ASU 2023-07 significantly expands disclosures about a public entity’s reportable segments, primarily through more frequent and enhanced disclosures about significant segment expenses.

Additionally, ASU 2023-07 requires disclosure of the title and position of the Chief Operating Decision Maker (CODM) and how the CODM uses the reported measure of a segment’s profit or loss.

Annually, third-party pricing vendor valuations are reviewed on a sample basis.

The specific inputs and assumptions used by third-party pricing vendors are assessed to verify appropriate classification within the fair value level hierarchy.

Visa Class C common shares are also categorized as Level 2 assets and are valued using quoted active market prices for similar securities (Visa Class A common shares).

See “Visa Class B Common Shares and Makewhole Agreement” under Note 24, “Commitments and Contingent Liabilities,” for further information.

| | | | DECEMBER 31, 2024 | | | | | | | | | | | | | | | | | | | | |

| | | | DECEMBER 31, 2024 | | | | | | | | | | | | | | | | | |

| Equity Securities(1) | | | 85.0 | | | | | | 26.3 | | | — | | | — | | | 111.3 | | |

| Foreign Exchange Contracts | | | — | | | | | | 4,997.3 | | | — | | | (1,745.2) | | | 3,252.1 | | |

| Interest Rate Contracts | | | — | | | | | | 361.2 | | | — | | | (165.2) | | | 196.0 | | |

| Total Derivative Assets | | | — | | | | | | 5,358.5 | | | — | | | (1,910.4) | | | 3,448.1 | | |

| Foreign Exchange Contracts | | | — | | | | | | 4,709.8 | | | — | | | (4,197.3) | | | 512.5 | | |

| Interest Rate Contracts | | | — | | | | | | 421.4 | | | — | | | (2.3) | | | 419.1 | | |

| Total Derivative Liabilities | | | $ | — | | | | | $ | 5,131.2 | | $ | 27.2 | | $ | (4,199.6) | | $ | 958.8 | |

*(1)* *Equity securities consists of a money market investment and Visa Class C common shares with a fair value of $85.0 million and $26.3 million, respectively, as of December 31, 2024.*

Assets measured at fair value on a nonrecurring basis at December 31, 2023, also includes other real estate owned (OREO) properties, categorized as Level 3 under the fair value hierarchy.

| | | | DECEMBER 31, 2024 | | | | | | | | | | | | | | | | | | | | |

February 27, 2024

| Trading Account | | | — | | | 95.2 | | |

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| Balance at January 1, 2021 | | | $ | 884.9 | | $ | 408.6 | | $ | 963.6 | | $ | 12,207.7 | | $ | 428.0 | | $ | (3,204.5) | | $ | 11,688.3 | |

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| | | | FOR THE YEAR ENDED DECEMBER 31, | | | | | | | | |

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income.

For cash flow hedges of certain other available for sale

Undrawn commitments relating to loans that are not held for sale are recorded in Other Liabilities and are carried at the amount of unamortized fees with an allowance for credit loss liability recognized for any estimated expected losses.

Additionally, a loan that has been formally

Northern Trust elected not to project changes in the factor for purposes of estimating expected future cash flows.

Troubled Debt Restructurings (TDRs) - Prior to the Adoption of Accounting Standards Update No. 2022-02. A loan that was modified as a concession by Northern Trust or a bankruptcy court resulting from the debtor’s financial difficulties was referred to as a troubled debt restructuring (TDR).

All TDRs were reported starting in the calendar year of their restructuring.

In subsequent years, a TDR may have ceased to be reported if the loan was modified at a market rate and performed according to the modified terms for at least six payment periods.

A loan that was modified at a below market rate was returned to accrual status if it satisfied the six-payment-period performance requirement.

The expected credit loss was measured based upon the present value of expected future cash flows, discounted at the effective interest rate based on the original contractual rate.

If a loan’s contractual interest rate varied based on subsequent changes in an independent factor, such as an index or rate, the loan’s effective interest rate was calculated based on the factor as it changed over the life of the loan.

Northern Trust elected not to project changes in the factor for purposes of estimating expected future cash flows.

Further, Northern Trust elected not to adjust the effective interest rate for prepayments.

If the loan was collateral dependent, the expected loss was measured based on the fair value of the collateral at the reporting date.

If the loan valuation was less than the recorded value of the loan, either an allowance was established, or a charge-off was recorded, for the difference.

Smaller balance (individually less than $1 million) homogeneous loans were collectively evaluated.

All loans with TDR modifications were evaluated for additional expected credit losses.

The nature and extent of further deterioration in credit quality, including a subsequent default, was considered in the determination of an appropriate level of allowance for credit losses.

In determining an appropriate allowance level, management evaluates numerous variables, many

sell the security for a period of time sufficient to allow for the recovery of the security’s amortized cost basis.

Actual losses may vary from current estimates and the amount of the Provision for Credit Losses may be either greater than or less than actual net charge-offs.

Northern Trust’s recorded other liability for standby letters of credit, reflecting the obligation it has undertaken, is measured as the amount of unamortized fees on these instruments.

assets, generally ranging from 3 to 10 years.

On January 1, 2023, Northern Trust adopted Accounting Standards Update (ASU) No. 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging—Portfolio Layer Method” (ASU 2022-01).

The amendments in ASU 2022-01 expand the current last-of-layer hedging model from a single-layer method to allow multiple hedged layers of a single closed portfolio.

To reflect that expansion, the last-of-layer method is renamed the portfolio layer method.

In addition, ASU 2022-01 (1) expands the scope of the portfolio layer method to include non-prepayable assets, (2) specifies eligible hedging instruments in a single-layer hedge, (3) provides additional guidance on the accounting for and disclosure of hedge basis adjustments under the portfolio layer method and (4) specifies how hedge basis adjustments should be considered when determining credit losses for the assets included in the closed portfolio.