NEW YORK (Reuters) - A top executive with Northern Trust Corp (NTRS.O) said the custodian bank will not impose an additional fee on institutional clients who significantly increase their cash holdings.
Rick Waddell, Northern Trust’s chairman and chief executive officer, said he has no problem with institutional customers using the bank’s balance sheet to dump cash after moving out of riskier assets.
“We allow our clients to use the balance sheet even when we can’t earn money at it,” said Waddell, speaking at the Barclays Capital Global Financial Services Conference in New York. “It serves us over the long term.”
Northern Trust’s position contrasts with Bank of New York Mellon (BK.N), the world’s largest custodian bank. In August, BNY Mellon told customers it would slap a fee on some of its biggest clients for making large, so-called “transient” deposits in a flight to safety as the global financial markets nosedived.
At the conference, Waddell said Northern Trust is taking steps to expand its business of managing money for wealthy individuals. He said the bank is specifically going after the growing millionaire population in the Washington, D.C. area, where it will soon open up an office.
“We want to be in front of the millionaire market,” he said.
Waddell also said that despite all the news surrounding the European sovereign debt crisis, Northern Trust’s European business hasn’t been affected much.
Reporting by Katya Wachtel, edited by Matthew Goldstein, Dave Zimmerman