Northern Trust, the major Chicago-based wealth manager, is
looking at setting up operations in Switzerland as part of its
expansion plans in the EMEA region, according to Kathleen Dugan, a
senior-vice president for the firm.
But Dugan, senior vice-president for corporate and institutional
global product management, would not say whether the operation was
likely to be a private banking, ultra high net worth or
institutional business.
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She said: “Our business model is to expand in EMEA, and we are
looking at Switzerland.”
She added: “The ultra high net worth is the main business line
with which we’ve expanded into EMEA. We see growth opportunities
not only in the business we have established but we also see growth
opportunities outside that.”
Dugan added the US-based business, which has assets under
custody of around $2.7 trillion, has recently expanded its
international operations in China and Australia, adding to existing
offices in London, Toronto and Singapore. Most of the business’s
expansion outside the US had been in the institutional or ultra
high net worth market.
Northern Trust’s business model is based on initially providing
data services to high net worth individuals, which helps clients
aggregate information about their portfolios from around the world.
It then uses leads from that part of its business to move them into
wealth management and other services it offers.
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By GlobalDataDugan gave the example of the collapse of Lehman Brothers as an
example of the strength of its data aggregation tools, which
allowed clients to work out their exposure to the failed investment
bank almost instantly with a few clicks of a mouse.
Dugan said: “When clients have large amounts of wealth to
manage, the one thing they want is fast, accurate data.
“This is the business we sell at the beginning. It’s not the
highest margin business, but you can serve as serve as an
aggregator of the information, hold most of the assets – and
because of that it’s then possible to lean into other areas.”
Northern Trust is also participating in the US Treasury’s
voluntary Capital Purchase Program, under which the government will
pay $1.5 billion in return for senior preferred stock and related
warrants. President and CEO Frederick Waddell said the business
already exceeded its capital requirements and would use the capital
to “maximise growth opportunities”.
Its wealth management arm provides customised products and
services to individuals and family offices throughout the world
with assets typically exceeding $75 million. Its Personal Financial
Services (PFS) business is one of the largest providers of personal
trust services in the US, with $323.3 billion in assets under
custody and $148.3 billion in assets under management at the end of
2007. PFS has 85 offices in the US, as well as offices in London
and Guernsey.
