Northern Trust (NTRS) in Chicago said Wednesday that its second-quarter profit rose 18% from the same period last year, to nearly $180 million, as fees from trust, investment and other services reached their highest levels in four years.
Earnings per share also increased 18%, to 73 cents, but fell two cents shy of consensus estimates of analysts polled by Thomson Reuters.
The $94 billion-asset Northern Trust is one of the world's largest custody banks. Trust, investment and servicing fees account for 61% o Northern Trust's revenue and in the most recent quarter those fees increased 9% from the same quarter last year, to $606 million. That helped offset a 27% decline in foreign exchange income, which the company attributed currency volatility and a decline in client volume. Northern Trust's chief rivals State Street (STT) and Bank of New York Mellon (BK) reported similar declines in forex income.
Net interest income climbed 3% year over year, to to $254 million, but that was due primarily to a 41% drop in its interest expense stemming from continued low interest rates.