Whats to like about Northern Trust?
They have an interesting niche. They focus on high-net-worth clients. They do a lot of hand-holding and custom portfolio management for these people, and it’s a very relationship-oriented business. But once they get the customer, they can then sell them other services. It’s just real “sticky” money. A lot of banks are trying to get into this and a lot of fund companies and private asset managers, but Northern Trust has been doing it for a long time. They’ve really got an edge. Q: You like it where? A: Under $43. Q: If other banks want to get into this line and Northern’s already in it, is it a potential takeover target? A: It’s possible, but that’s not why we bought it. It would be a nice side benefit if it happened. Q: What else do you like? A: The payroll processors, Automatic Data Processing (ADP ) and Paychex (PAYX ). They would actually benefit from a rise in interest rates, which I could see happening over the next year. Q: They’re helped by getting interest on the float? A: Defi
