Northern Trust, a Chicago-based financial holding company, has announced a decline in profit for the second quarter. The unfavorable market conditions have impacted investment results, leading to a decrease in profit.
In the quarter ended June 30, the company's profit fell to $331.8 million or $1.56 per share, compared to $396.2 million or $1.86 per share during the same period last year. Analysts were expecting per-share earnings of $1.61, according to FactSet.
Furthermore, the company's revenue also saw a slight dip of 1%, down to $1.77 billion from $1.78 billion in the previous year. However, this was in line with analysts' expectations.
On a positive note, Northern Trust experienced a 12% increase in net interest income, reaching $524.6 million in the second quarter, thanks to rising interest rates.
Unfortunately, the challenging market conditions compared to the previous year affected the company's investment returns and resulted in decreased revenues in investment management and wealth management sectors.
Moreover, Northern Trust witnessed a sharp decline of 35% in income from foreign exchange trading due to lower volumes and unfavorable foreign exchange rates.
Total interest-bearing deposits also fell by 10%, amounting to $91.88 billion.
Despite these challenges, the company saw growth in assets under management, which rose by 5% to $1.366 billion compared to the previous year and by 3% compared to the first quarter of this year.
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