Pension and Postretirement Health Care

9 Months Ended

Sep. 30, 2020

Retirement Benefits [Abstract]

Pension and Postretirement Health Care

Pension and Postretirement Health Care

The following table sets forth the net periodic pension and postretirement benefit expense for Northern Trust’s U.S. Qualified Plan, Non-U.S. Pension Plans, U.S. Non-Qualified Plan, and postretirement health care plan for the three and nine months ended September 30, 2020 and 2019.

TABLE 73: NET PERIODIC PENSION EXPENSE (BENEFIT)

U.S. QUALIFIED PLAN	THREE MONTHS ENDED SEPTEMBER 30,				NINE MONTHS ENDED SEPTEMBER 30,
(In Millions)	2020		2019		2020		2019
Service Cost	$	11.9	$	10.4	$	35.5	$	31.2
Interest Cost	10.8		11.8		32.4		35.4
Expected Return on Plan Assets	(19.2)		(21.7)		(57.6)		(65.1)
Amortization
Net Actuarial Loss	8.8		4.3		26.4		12.9
Prior Service Cost	(0.1)		(0.1)		(0.3)		(0.3)
Net Periodic Pension Expense	$	12.2	$	4.7	$	36.4	$	14.1

NON-U.S. PENSION PLANS	THREE MONTHS ENDED SEPTEMBER 30,				NINE MONTHS ENDED SEPTEMBER 30,
(In Millions)	2020		2019		2020		2019
Service Cost	$	0.6	$	0.5	$	1.6	$	1.5
Interest Cost	0.7		0.9		2.1		2.9
Expected Return on Plan Assets	(0.8)		(1.0)		(2.3)		(2.9)
Settlement Expense	0.1		—		0.3		—
Amortization
Net Actuarial Loss	0.2		0.2		0.8		0.5
Prior Service Cost	0.1		—		0.1		—
Net Periodic Pension Expense	$	0.9	$	0.6	$	2.6	$	2.0

U.S. NON-QUALIFIED PLAN	THREE MONTHS ENDED SEPTEMBER 30,				NINE MONTHS ENDED SEPTEMBER 30,
(In Millions)	2020		2019		2020		2019
Service Cost	$	1.2	$	1.1	$	3.4	$	3.1
Interest Cost	1.2		1.5		3.6		4.4
Amortization
Net Actuarial Loss	1.7		1.4		5.3		4.2
Prior Service Cost	—		—		0.1		0.1
Net Periodic Pension Expense	$	4.1	$	4.0	$	12.4	$	11.8

POSTRETIREMENT HEALTH CARE PLAN	THREE MONTHS ENDED SEPTEMBER 30,				NINE MONTHS ENDED SEPTEMBER 30,
(In Millions)	2020		2019		2020		2019
Interest Cost	$	0.2	$	0.3	$	0.6	$	0.9
Amortization
Net Actuarial (Gain)	(0.1)		(0.2)		(0.5)		(0.8)
Prior Service Cost	(0.1)		—		(0.1)		—
Net Periodic Postretirement Expense	$	—	$	0.1	$	—	$	0.1

Northern Trust expects to change the plan design of its post-retirement health care plan as of January 1, 2021, which results in the recognition of negative prior-service cost at the time these changes were communicated to participants in August 2020. Concurrently, a further shift in population from active to inactive participants required an adjustment to the amortization period from the average remaining service period of active participants to the average life expectancy of the inactive participants. The change in plan design and amortization period results in a decrease of the benefit obligation and 2020 benefit expense by $12.6 million and $0.3 million, respectively.

The components of net periodic pension expense are recorded in Employee Benefits expense within the consolidated statements of income.

There were no contributions to the U.S. Qualified Plan during the nine months ended September 30, 2020 and 2019, respectively.