Northern Trust (NTRS)

FULL-YEAR PERFORMANCE HIGHLIGHTS

Net income per common share of $3.24 for the year ended December 31, 2007 was 8% higher than the $3.00 reported in 2006. Net income was $726.9 million compared with $665.4 million earned last year and resulted in a return on average common equity of 17.46% and a return on average assets of 1.20%. Full-year performance was negatively impacted by the $150 million of Visa related indemnification accruals recorded in the current quarter and discussed previously. Excluding the Visa charges, operating earnings per common share was $3.66 for 2007, an increase of 22% from $3.00 per share a year ago. Net operating earnings increased 23% to $821.1 million, up from $665.4 million last year.

Revenues of $3.57 billion were up 17% from $3.06 billion last year. Trust, investment and other servicing fees were $2.08 billion for the year, up 16% compared with $1.79 billion last year. Trust, investment and other servicing fees represented 58% of revenues and total fee-related income represented 75% of total revenues.

Trust, investment and other servicing fees from C&IS increased 17% to $1.18 billion from $1.01 billion a year ago. Custody and fund administration fees increased 22% to $615.2 million, reflecting strong growth in global fees. Securities lending fees totaled $207.1 million compared with $191.5 million last year, reflecting higher volumes, partially offset by lower yields earned in one mark-to-market investment fund used in our securities lending activities. Fees from asset management grew 13% to $290.6 million.

Trust, investment and other servicing fees from PFS increased 15% and totaled $897.8 million compared with $779.2 million a year ago. The increase resulted primarily from strong new business results and higher equity markets. Revenue growth continued to be broad-based, with all regions and the Wealth Management Group reporting year-over-year increases in fees.

Foreign exchange trading income increased 42% and totaled $351.3 million for the year compared with $247.3 million last year. The increase reflects strong client volumes as well as higher currency volatility. Revenues from security commissions and trading income were $67.6 million compared with $62.7 million in the prior year. Other operating income was $109.1 million for the period compared with $97.8 million last year, and included second quarter gains on the sale of leased assets totaling $4.9 million, a $4.1 million loss on the sale of a subsidiary, and

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FULL-YEAR PERFORMANCE HIGHLIGHTS (continued)

other miscellaneous items. A gain of $6.3 million was recognized in the current year on the sale of investment securities.

Net interest income, stated on a fully taxable equivalent basis, totaled $894.1 million, an increase of 13% from $794.7 million reported in the prior year period. The increase reflects higher levels of average earning assets, partially offset by a decline in the net interest margin. Total average earning assets of $53.4 billion were 16% higher than a year ago. The net interest margin of 1.67% was down from 1.73% in the prior year, reflecting the impact of FSP 13-2, the narrowing of the interest rate spread, and the significant growth in global custody-related deposits which have been invested primarily in short-term money market assets and securities.

The provision for credit losses was $18.0 million for the year compared with $15.0 million in 2006. Net charge-offs totaled $8.8 million compared with net charge-offs of $.2 million in 2006.

Noninterest expenses totaled $2.43 billion for the year, up 24% from $1.96 billion a year-ago. Compensation and employee benefit expenses of $1.27 billion represented 52% of total operating expenses. The current period expense increase reflects the impact of higher staff levels, higher performance-based compensation, annual salary increases, and higher employment taxes and health care costs.

Expenses associated with outside services totaled $386.2 million, up $70.0 million or 22% from last year, reflecting higher expenses for technical and consulting services and volume-driven growth in global subcustody and investment manager sub-advisor expenses.

The remaining expense categories totaled $770.9 million, up 41% from $546.5 million in 2006. The increase reflects the $150 million Visa related indemnification charges, significantly higher charges related to securities processing activities, increased litigation and computer software expense, higher occupancy costs, business promotion and advertising, and increased hiring and employee relocation costs.

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FULL-YEAR PERFORMANCE HIGHLIGHTS (continued)

Total income tax expense was $333.9 million for the year representing an effective rate of 31.5%. This compares with $358.8 million in income tax expense and an effective rate of 35.0% for 2006. The prior period tax provision included approximately $15 million of additional reserves related to leveraged leasing transactions compared to approximately $7 million in the current year. The effective tax rate in the current year benefited from lower U.S. federal and state income tax provisions due to a higher proportion of income generated in tax jurisdictions outside the U.S. with more favorable tax rates, a net reduction in state income tax reserves, and a reduction in net deferred tax liabilities resulting from new state tax legislation enacted during the third quarter.

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FULL-YEAR PERFORMANCE HIGHLIGHTS

Full-year performance information includes the results of Baring Asset Management’s Financial Services Group, which was acquired on March 31, 2005. Record net income per common share of $3.00 was 14% higher than the $2.64 reported in 2005. Record net income was $665.4 million compared with $584.4 million earned last year and resulted in a return on average common equity of 17.6%.

Revenues of $3.06 billion were up 14% from the $2.69 billion last year. Trust, investment and other servicing fees were $1.79 billion for the period, up 15% compared with $1.56 billion last year. Trust, investment and other servicing fees represented 59% of revenues and total fee-related income represented 74% of total revenues.

Trust, investment and other servicing fees from C&IS increased 19% to $1.0 billion from $851.4 million a year ago. Custody and fund administration fees increased 25% to $500.3 million for the year, reflecting strong growth in global fees. Securities lending fees increased

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FULL-YEAR PERFORMANCE HIGHLIGHTS (continued)

29% and totaled $191.5 million compared with $148.7 million last year primarily reflecting higher volumes and improved spreads on the investment of cash collateral, while fees from asset management grew 6% to $256.3 million.

Trust, investment and other servicing fees from PFS increased 10% and totaled $781.3 million compared with $708.0 million last year. The increase resulted primarily from new business and higher equity markets. Revenue growth was broad-based, with all regions and the Wealth Management Group reporting year-over-year increases in fees.

Foreign exchange trading income was $247.3 million in the period compared with $180.2 million last year. Revenues from security commissions and trading income were $62.7 million compared with $55.2 million in the prior year. Other operating income was $97.8 million for the period compared with $97.5 million last year. The prior year included $9.2 million of nonrecurring gains.

Net interest income, stated on a fully taxable equivalent basis, totaled $794.7 million, an increase of 10% from the $722.3 million reported in the prior year. Total average earning assets of $46.0 billion were 14% higher than a year ago. The net interest margin of 1.73% was down from 1.79% in the prior year.

The provision for credit losses was $15.0 million for the year compared with $2.5 million in 2005. The provision in 2006 is primarily due to the growth in the commercial loan portfolio and the migration of certain loans to higher risk credit ratings, partially offset by repayments received on lower rated loans. Net charge-offs totaled $.2 million compared with $5.8 million of net charge-offs last year.

Noninterest expenses totaled $1.96 billion for the period, up 13% from $1.73 billion a year-ago. Compensation and employee benefits of $1.09 billion represented 56% of total noninterest expenses and included $17.7 million of expense associated with the expensing of stock options which began in the current year. The increased expenses also reflect the impact of higher staff levels, annual salary increases, performance based compensation, and higher employment taxes, pension and health care costs.

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FULL-YEAR PERFORMANCE HIGHLIGHTS (continued)

Other expense categories totaled $862.7 million for the period, up 12% from $770.3 million in 2005. The increase primarily reflects higher consulting and other professional services, volume driven growth in global subcustody expense, and increased occupancy expense and amortization of computer software and intangible assets.

Total income tax expense was $358.8 million for the year representing an effective rate of 35.0%. This compares with $303.4 million in income tax expense and an effective rate of 34.2% in 2005. The 2006 tax provision includes a $15.0 million increase in tax reserves associated with Northern Trust’s leveraged leasing portfolio, partially offset by the $9.9 million in tax items recorded in the fourth quarter of 2006.

FULL-YEAR PERFORMANCE HIGHLIGHTS

Net income per common share was a record $2.64, 16% higher than the $2.27 reported in 2004. Net income was a record $584.4 million compared with $505.6 million earned last year and resulted in a return on average common equity of 17.01% and a return on average assets of 1.27%.

Revenues of $2.69 billion, which includes $130.8 million from FSG and $19.8 million of acquisition-related funding costs, were up 15% from the $2.33 billion last year. Trust, investment and other servicing fees were $1.56 billion for the year, up 17% compared with $1.33 billion last year. Trust, investment and other servicing fees represented 58% of revenues and total fee-related income represented 73% of revenues.

Trust, investment and other servicing fees from C&IS increased 25% to $852.5 million from $680.4 million a year ago. Custody and fund administration fees increased 47% to $400.0 million for the year, reflecting strong growth in global fees including revenues from FSG. Securities lending fees totaled $148.7 million compared with $120.1 million last year primarily reflecting higher volumes, while fees from asset management grew 5% to $242.0 million.

Trust, investment and other servicing fees from PFS increased 9% and totaled $706.9 million compared with $649.9 million last year. The increase resulted primarily from improved equity markets and new business. Revenue growth was broad-based, with all regions and the Wealth Management Group reporting year-over-year increases in fees.

Foreign exchange trading profits were $180.2 million for the year compared with $158.0 million last year. Treasury management fees were $71.2 million, down 19% from the prior year. Approximately half of this decrease was offset by improved net interest income as clients opted to pay for services via compensating balances. Revenues from security commissions and trading income were $55.2 million compared with $50.5 million in the prior year. Other operating income was $97.5 million for the period compared with $83.8 million last year. The current year included $9.2 million of nonrecurring gains compared with $5.1 million last year. The remainder of the increase primarily resulted from higher custody related deposit revenues.

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FULL-YEAR PERFORMANCE HIGHLIGHTS (continued)

Net interest income, stated on a fully taxable equivalent basis, totaled a record $722.3 million, an increase of 17% from the $615.5 million reported in the prior year. The net interest margin increased to 1.79% from 1.66% in the prior year due in large part to wider spreads earned on retail deposits and an improved funding mix. Total average earning assets of $40.5 billion were 9% higher than a year ago. Money market assets were up 3% and averaged $11.8 billion for the period. Average securities increased 21% to $9.9 billion while average loans and leases were up 7% to $18.8 billion.

The provision for credit losses was $2.5 million for the year compared with a negative $15.0 million in 2004. Net charge-offs totaled $5.8 million compared with $2.9 million in 2004.

Noninterest expenses totaled $1.73 billion for the period, up 13% from $1.53 billion a year-ago. FSG operating and integration expenses totaled $105.9 million in the period.

Compensation and employee benefits of $964.6 million represented 56% of total operating expenses and included $56.8 million from the addition of FSG. The current period expenses also reflect annual salary increases and higher incentive compensation, employment taxes, and retirement and health care costs.

Other expense categories totaled $770.3 million for the period, up 9% from $708.5 million in 2004, and included $49.1 million from the addition of FSG. The remaining increase primarily reflects higher expenses for consulting services, business promotion and advertising, employee relocation and hiring costs, and fees for global subcustody services. Partially offsetting the increase were lower expenses associated with operating risks related to servicing and managing financial assets. The prior period included a $17.0 million litigation settlement in the third quarter of last year and an $11.6 million loss in the first quarter of last year from securities processing activities.

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FULL-YEAR PERFORMANCE HIGHLIGHTS

Net income per common share was a record $2.27, 26% higher than the $1.80 reported in 2003. Net income was a record $505.6 million, compared with $404.8 million earned last year, and resulted in returns on average common equity of 16.07% and average assets of 1.22%.

As a result of the 2003 second quarter sale of the assets of Northern Trust Retirement Consulting, L.L.C. (NTRC), its operating results for all periods presented have been shown as discontinued operations in Northern Trust’s consolidated statement of income. The net income from discontinued operations in the current year totaled $.8 million, compared with a net loss of $18.5 million in the prior year, which included the $20.2 million pre-tax loss on the sale and NTRC’s net loss from operations.

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