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Northern Trust — bank health check

NTRS
Custody & trustAssets $179.3B4-quarter TTM
Close · Oct 16, 2026165.54P/E 14.2 · yield 2.0%
P/TBV2.59×TBVPS 63.86
Line · r 10%2.28×range 2.00–2.66×
+14% premiumP/TBV ÷ line − 1
Fed funds · last FOMC3.75–4.00%Sep 16, 2026 · +25bp
UST 3m · 2y · 10y · Oct 16, 20264.26 · 4.74 · 5.0910y−2y +0.35 · 10y−3m +0.83
KBE · YTD+4.8%1D +0.1% · 1Y +15.5% · 5Y +15%
KRE · YTD+7.7%1D +0.1% · 1Y +20.1% · 5Y −1%
SPY · YTD+11.9%1D −1.1% · 1Y +15.5% · 5Y +71%
Prices as ofOct 16, 2026Financials TTM through Sep 30, 2026

Valuation range

the line at three costs of equity
r 11% · 2.00×r 9% · 2.66×now 2.59×
0.0×1.0×2.0×3.0×4.0×

At r = 10% the line gives 2.28× for a 19.0% ROTCE; the market pays 2.59×, a 14% premium to the line.

Where it has traded

quarter-end P/TBV · 20 quarters · Sep 30, 2021 → Jun 30, 2026
1.00×1.63×2.25×2.88×3.50×2021202220232024202520262021-09-30 · 2.19× (close 107.81 · TBVPS 49.34)2021-12-31 · 2.39× (close 119.61 · TBVPS 49.98)2022-03-31 · 2.48× (close 116.45 · TBVPS 47.04)2022-06-30 · 2.12× (close 96.48 · TBVPS 45.46)2022-09-30 · 1.89× (close 85.56 · TBVPS 45.32)2022-12-31 · 1.91× (close 88.49 · TBVPS 46.36)2023-03-31 · 1.84× (close 88.13 · TBVPS 47.95)2023-06-30 · 1.53× (close 74.14 · TBVPS 48.37)2023-09-30 · 1.40× (close 69.48 · TBVPS 49.55)2023-12-31 · 1.69× (close 84.38 · TBVPS 49.93)2024-03-31 · 1.73× (close 88.92 · TBVPS 51.28)2024-06-30 · 1.55× (close 83.98 · TBVPS 54.35)2024-09-30 · 1.62× (close 90.03 · TBVPS 55.63)2024-12-31 · 1.81× (close 102.50 · TBVPS 56.58)2025-03-31 · 1.71× (close 98.65 · TBVPS 57.58)2025-06-30 · 2.18× (close 126.79 · TBVPS 58.27)2025-09-30 · 2.26× (close 134.60 · TBVPS 59.47)2025-12-31 · 2.27× (close 136.59 · TBVPS 60.24)2026-03-31 · 2.88× (close 139.57 · TBVPS 48.41)2026-06-30 · 2.72× (close 173.84 · TBVPS 63.86)p75 2.26×med 1.90×p25 1.71×now 2.59×
Five-year median 1.90×, middle half 1.71–2.26×, range 1.40–2.88×. Now 2.59×: +37% above its own median, higher than 90% of those quarters.Each quarter priced at its own TBVPS · the band is the 25th–75th percentile

Where the money goes

TTM through Jun 30, 2026 · $B
02468Interest income: 8.7 $B8.7InterestincomeInterest expense: −6.1 $B−6.1InterestexpenseNII: 2.6 $B2.6NIINon-interest income: 6.5 $B6.5Non-interestincomeNet revenue: 9.1 $B9.1NetrevenueOperating expenses: −6.1 $B−6.1OperatingexpensesProvision: 0.0 $B0.0ProvisionPre-tax: 3.0 $B3.0Pre-taxTax: −0.8 $B−0.8TaxNet income: 2.2 $B2.2Netincome
assets $179.3B ÷ TCE $11.8B = 15.2× leverage · ROA 1.25% × 15.2 = ROTCE 19.0%

Revenue mix

NII vs. non-interest income · Custody & trust peers (2)
NTRS28 / 72
Tier average23 / 77

Efficiency 67.0% vs. tier 64.5% · ROTCE 19.0% vs. 22.1% · credit cost -0.3% vs. -0.1% · AOCI/TCE −4.7% vs. −15.2%.

Quarter by quarter

8 quarters · Sep 30, 2024 → Jun 30, 2026 · a gap is a dropped quarter
NII, $B0.7
Provision, $B−0.01
Efficiency60.7%
AOCI / TCE−4.7%