News Column

Fitch Rates Northern Trust's Preferred Stock Issuance 'BBB'

July 29, 2014

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has assigned a 'BBB' rating to Northern Trust Corporation's (Northern) preferred stock issuance.

The preferred stock rating is detailed below and is consistent with Fitch's notching criteria from each of the entities Viability Rating (VR). Northern's IDR is currently rated

'AA-/F1+'; VR 'aa-' by Fitch; all of which were last affirmed on Feb. 12, 2014, following Fitch's trust and processing bank peer review.

The five notch differential in the ratings of Northern's preferred stock include two notches for loss severity given these securities deep subordination in the capital structure, and three notches for non-performance given that the coupon of the securities is non-cumulative and fully discretionary.

KEY RATING DRIVERS - PREFERRED STOCK AND OTHER HYBRID SECURITIES

Northern's preferred stock rating is five notches below the entities VR of 'aa-' in accordance with Fitch's assessment of each instrument's respective non-performance and relative loss severity risk profiles.

KEY RATING SENSITIVITIES - PREFERRED STOCK AND OTHER HYBRID SECURITIES

The ratings of preferred stock issued by Northern are primarily sensitive to any change in the company's VR.

Fitch Rates the following:

Northern Trust Corporation

--Preferred Stock 'BBB'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Financial Institutions Rating Criteria' (January 2014);

--'Rating FI Subsidiaries and Holding Companies' (January 2014);

--'Assessing and Rating Bank Subordinated and Hybrid Securities' (January 2014);

--'U.S. Bank HoldCos & OpCos: Evolving Risk Profiles' (March 2014).

Applicable Criteria and Related Research:

Global Financial Institutions Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=732397

Rating FI Subsidiaries and Holding Companies

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679209

Assessing and Rating Bank Subordinated and Hybrid Securities Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=732137

U.S. Bank HoldCos & OpCos: Evolving Risk Profiles

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=742096

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=842478

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.



Fitch Ratings

Primary Analyst

Justin Fuller, CFA

Senior Director

+1-312-368-2057

Fitch Ratings, Inc.

70 W. Madison, Street

Chicago, IL 60602

or

Secondary Analyst

Chris Wolfe

Managing Director

+1-212-908-1171

or

Committee Chairperson

Joo-Yung Lee

Managing Director

+1-212-908-0560

or

Media Relations

Brian Bertsch, +1 212-908-0549

brian.bertsch@fitchratings.com

Source: Fitch Ratings


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