Northern Trust commits to independence after WSJ report on potential merger with BNY

Northern Trust is fully committed to remaining independent, the bank said on Monday, after the Wall Street Journal reported that Bank of New York Mellon had approached the asset and wealth manager to express interest in a merger.

"I can tell you that Northern Trust is fully committed to remaining independent and continuing to deliver long-term value to our stakeholders, as we have for the past 135 years," its spokesperson said in an email.

Northern Trust's NTRS shares were up 6.5% on the Wall Street Journal report. Bank of New York Mellon BK declined to comment on the report.

A potential deal between BNY, the world's largest custodian bank, and Northern Trust would reshape the asset servicing and wealth management industry by combining two of the sector's biggest players.

The chief executives of BNY and Northern Trust had at least one conversation, but no offer was discussed, the newspaper reported on Sunday, citing people familiar with the matter.

BNY may approach Northern Trust in the future with a formal bid, however it may not result in a transaction, the report added.

"Any deal would have to clear antitrust hurdles," Rajiv Bhatia, analyst at Morningstar said, adding that State Street STT, JPMorgan JPM and Citigroup C are still major custody competitors.

"The Trump administration has seemed to take a light regulatory approach to banks and note the $35 billion takeover of Discover by Capital One was approved."

Analysts at Keefe, Bruyette & Woods said in a note they see low probability of this reported merger getting done, partly due uncertainty about Northern Trust's interest in selling, as well as anticipated regulatory hurdles.

"We believe the bar is soon to be lowered for larger bank mergers, this potential deal would involve a Category 1 bank and a Category 2 bank, which may still face a higher hurdle than two super-regional banks," the note led by David Konrad said.

Category 1 usually refers to U.S. banks that are systemically important globally.

Bank dealmaking is widely expected to pick up in the second half of 2025, as easing regulatory uncertainty and stabilizing interest rates revive boardroom appetite for consolidation.

BNY had a market cap of $65.55 billion while Northern Trust has a market cap of $21.76 billion, through previous close, according to LSEG.

Both BNY and Northern Trust offer a broad suite of services that involve holding, managing and transferring money on behalf of corporations, investment firms and financial advisers.

BNY Mellon shares were down 3.8%. The stock has risen about 15% so far this year. Northern Trust had gained 16% for the year.