ntrs_investor_day_cis

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  • 1. Corporate & Service Expertise Integrity Institutional Services Timothy J. Theriault President, C&IS Principles That Endure INVESTOR DAY 2008 © 2008 Northern Trust Corporation
  • 2. Key Strategic Priorities Corporate & Institutional Services Competing and winning around the world Complexity drives innovation Broad array of solutions Unique global operating model Extending industry leading technology platform Service Expertise Integrity 2
  • 3. Strategically Positioned to Succeed in Three Dynamic Regions Europe, North America Asia Pacific Middle East & Africa Chicago Amsterdam London Dublin Limerick Beijing Guernsey Luxembourg Tokyo Jersey Toronto Hong Kong Bangalore Abu Dhabi Singapore Melbourne Service Expertise Integrity 3
  • 4. Actively Pursuing Mandates Across Multiple Markets Finland UAE Germany Switzerland Canada Norway Sweden Luxembourg United Kingdom China Ireland Thailand Guernsey U.S.A. and Jersey South Korea Macau Netherlands Cayman Islands Taiwan Philippines Malaysia Puerto Rico Guam Tunisia Hong Kong Singapore New Zealand Kuwait Qatar Australia Bahrain Saudi Arabia Service Expertise Integrity 4
  • 5. Success in Regions and Target Segments Around the World East Riding of Yorkshire Council (UK) $4 Billion Delaware Public Employees’ Insight Investment (UK) Outsourcing $190 Billion Retirement System Hospitals of Ontario $6.5 Billion Pension Plan Generation Investment Management (UK) Outsourcing $20 Billion Brevan Howard Macro Limited (UK) Hedge Fund Administration Strathclyde Pension Fund (UK) $20 Billion China’s National Social Security Fund SBZ State of Tennessee (Netherlands) $29 Billion $3 Billion Qualified Vervoer Domestic (Netherlands) Institutional $9 Billion Investors Employees’ Retirement (China) System of Hawaii $11 Billion Los Angeles Australian Employees’ Retirement Government System Future Fund $12 Billion $42 Billion Abu Dhabi Retirement New Zealand Pensions & Benefits Fund Superannuation $ Multi-Billion Fund $8 Billion Service Expertise Integrity 5
  • 6. Complexity Drives Innovation With over 50% of client assets cross-border, our expertise in the global investment arena drives us to anticipate change and predict future trends. Industry dynamics… …play to Northern Trust’s strengths Convergence of Investment Styles End to end full service solutions across asset classes Globalization of Asset Allocations 24 / 7 processing, regional hubs, local servicing “centers of excellence” Outsourcing Non-Core Activities Service solutions designed to facilitate client growth and improve efficiency Risk And Regulatory Influences Tools, technology and intellect to measure, monitor and manage risk Product Complexity Global insights drive industry leading solutions - ERISA pooling Credit Market Disruption “Flight to quality” as market rewards financial performance, strength, stability Emergence of Sovereign Wealth Proven expertise and conservative business approach ensures a cultural fit Evolving Retirement Trends Ahead of the curve – Global retirement solutions span all disciplines Service Expertise Integrity 6
  • 7. Asset Servicing Solutions Full array of capabilities to meet the needs of sophisticated institutional investors. Active Manager of managers Asset Quantitative Hedge funds Management Investment outsourcing Private equity Liability driven investing Transition management Asset Cross-border pooling Securities lending Enhancement Trade execution Foreign exchange Cash management Commission management Investment accounting Risk monitoring and reporting Asset Reporting Reporting and valuation Trade execution analysis Performance analytics Data warehouse Fund accounting Trustee Asset Administration Transfer agency Investment operations outsourcing Corporate secretarial Safekeeping Income collection Asset Processing Settlement Corporate actions Derivatives processing Tax reclamation Service Expertise Integrity 7
  • 8. A Single Global Operating Model Unique in the industry… A single operating platform across ALL regions, ALL clients, ALL constituencies. 09:00 19:00 03:00 Central Daylight Time Dublin Chicago Limerick London Guernsey Bangalore Singapore Platform delivers all services… from trade capture to investment operations outsourcing Organic growth and development of technology... back, middle and front office Unaffected by large-scale acquisitions… no need for technology integration Service Expertise Integrity 8
  • 9. Outstanding Growth in Client Assets Strong historical performance sets a high bar for the future. C&IS Assets Global Custody C&IS Assets Under Custody Assets Under Management ($ Trillions) ($ Trillions) ($ Billions) $3.8 $2.0 $609 $563 $3.3 $1.7 $501 $462 $2.7 $2.3 $374 $1.2 $1.9 $1.0 $0.7 2003 2004 2005 2006 2007 2003 2004 2005 2006 2007 2003 2004 2005 2006 2007 CAGR +19% CAGR +29% CAGR +13% S&P 500 CAGR: +7% EAFE CAGR: +15% S&P 500 CAGR: +7% Service Expertise Integrity 9
  • 10. Excellent Top-line and Bottom-line Growth… …and industry-leading profit margins. C&IS Revenues C&IS Net Income C&IS Pre-Tax Margin ($ Billions) ($ Millions) $2.1 $526 42% $1.7 40% 37% 39% $392 $1.4 33% 31% $318 $1.1 28% $278 $1.0 $176 2003 2004 2005 2006 2007 2003 2004 2005 2006 2007 2003 2004 2005 2006 2007 Competitors’ Average Margin* CAGR +20% CAGR +31% *2007 Competitors’ average margin computed using the following: Bank of NY Mellon – Asset Servicing; Citigroup – Markets & Banking (Transaction Services only); JPMorgan Chase – Treasury & Security Services; State Street – total company. 2006 Competitors’ average margin computed using the similar relevant business segments and included legacy Mellon. Service Expertise Integrity 10
  • 11. Strategic Growth Initiatives Thinking globally, acting locally. Europe, North America Asia Pacific Middle East & Africa Foundational Strength Growth Momentum A Region of for Growth Continues Vast Opportunity Build out integrated investment and administration solutions Enhance capabilities for Develop onshore fund asset manager servicing administration service Globalize retirement market products and solutions Expand local presence Open in new markets and jurisdictions Deliver best in class alternative asset solutions Service Expertise Integrity 11
  • 12. Corporate & Institutional Services Summary and Q&A Attractive Client Markets Client- Focused Brand Capabilities Centric Key Strategies and Opportunities for Long-term Growth Excellence in Execution Competing and winning around the world Complexity drives innovation Broad array of solutions Unique global operating model Extending industry leading technology platform Service Expertise Integrity 12
  • 13. Corporate & Service Expertise Integrity Institutional Services Timothy J. Theriault President, C&IS Principles That Endure INVESTOR DAY 2008 © 2008 Northern Trust Corporation