STT State Street Corporation

On Tuesday, Northern Trust Corporation (NTRS) announced the expansion of its services in Australia. The company added Unit Registry solutions to improve its fund administration capabilities in Australia.

NTRS has signed an agreement with Computershare to provide such services combining local expertise with a wide range of worldwide capabilities.

Computershare Limited is a global market leader in transfer agency and share registration, employee equity plans, proxy solicitation and stakeholder communications. It also specializes in bankruptcy administration, tax voucher solutions, corporate trust services and a range of other diversified financial and governance services.

NTRS will be able to provide best-in-class solutions to the clients’ needs as the contract with Computershare permits the company to provide local expertise, scale and operational excellence in unit registry services.

Further, the deal with NTRS extends the capabilities of Computershare’s broader infrastructure and proprietary technology, Trust Architect, enabling it to cater the markets unit registry needs more comfortably.

In addition to Unit Registry capabilities, services offered by NTRS to investment managers in Australia includes one-stop-shop solution combining unit registry, a multiple product, single platform, unit pricing, tax, investment operations outsourcing, accounting, performance, risk and compliance services.

In 2009, NTRS also established Retirement Solutions Practice as the UK pensions market was very attractive for the company. Through Retirement Solutions Practice, NTRS facilitates pension fund clients in catering to the challenges faced by them in the market. The company makes the clients aware of the regulatory changes and updates on trends and challenges affecting them.

We expect increased asset management and servicing fees based on improvements in equity markets and higher volumes to benefit NTRS. However, the Dodd-Frank Act will ring in numerous regulatory changes over the next several years, which might act as a deterrent to the company’s fundamentals. As of March 31, 2011, NTRS had $4.4 trillion in assets under custody and $662.2 billion in assets under management.

NTRS currently retains its Zacks #4 Rank, which translates into a short-term Sell rating. However, the closest peer of NTRS, State Street Corporation (STT) retains a Zacks #3 Rank (a short-term Hold rating).

 
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