10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2007

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to __________

Commission File No. 0-5965

NORTHERN TRUST CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	36-2723087
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
50 South LaSalle Street Chicago, Illinois	60603
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (312) 630-6000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer  x                    Accelerated Filer  ¨                    Non-Accelerated Filer  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ¨    No  x

219,407,279 Shares - $1.66 2/3 Par Value

(Shares of Common Stock Outstanding on March 31, 2007)

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CONSOLIDATED BALANCE SHEET NORTHERN TRUST CORPORATION

($ In Millions Except Share Information)	March 31 2007			December 31 2006			March 31 2006
Assets
Cash and Due from Banks	$	2,571.5		$	4,961.0		$	2,815.4
Federal Funds Sold and Securities Purchased under Agreements to Resell		2,923.3			1,299.7			911.8
Time Deposits with Banks		16,597.4			15,468.7			11,881.5
Other Interest-Bearing		20.8			21.9			27.8
Securities
Available for Sale		11,439.7			11,249.6			9,991.2
Held to Maturity (Fair value - $1,122.8 at March 2007, $1,122.1 at December 2006, $1,139.2 at March 2006)		1,109.2			1,107.0			1,126.6
Trading Account		8.1			8.6			6.7
Total Securities		12,557.0			12,365.2			11,124.5
Loans and Leases
Commercial and Other		12,979.0			13,935.3			11,694.8
Residential Mortgages		8,679.2			8,674.4			8,345.8
Total Loans and Leases (Net of unearned income - $565.8 at March 2007, $507.9 at December 2006, $462.7 at March 2006)		21,658.2			22,609.7			20,040.6
Reserve for Credit Losses Assigned to Loans and Leases		(138.3	)		(140.4	)		(129.3	)
Buildings and Equipment		483.0			487.2			461.4
Customers’ Acceptance Liability		.9			1.2			.4
Trust Security Settlement Receivables		281.0			339.3			291.5
Other Assets		2,577.6			3,298.7			2,769.4
Total Assets	$	59,532.4		$	60,712.2		$	50,195.0
Liabilities
Deposits
Demand and Other Noninterest-Bearing	$	4,631.2		$	5,434.0		$	4,764.7
Savings and Money Market		7,197.4			6,297.6			6,927.2
Savings Certificates		1,987.3			1,999.3			1,606.8
Other Time		476.8			459.6			374.1
Non-U.S. Offices - Demand		1,810.2			3,880.9			1,868.6
- Time		30,916.7			25,748.8			19,067.4
Total Deposits		47,019.6			43,820.2			34,608.8
Federal Funds Purchased		795.6			2,821.6			2,409.7
Securities Sold Under Agreements to Repurchase		1,188.5			1,950.5			2,344.1
Commercial Paper		—			—			145.5
Other Borrowings		402.1			2,976.5			1,369.2
Senior Notes		445.1			445.4			273.6
Long-Term Debt		2,683.0			2,307.9			2,655.9
Floating Rate Capital Debt		276.5			276.5			276.4
Liability on Acceptances		.9			1.2			.4
Other Liabilities		2,677.7			2,168.5			2,408.0
Total Liabilities		55,489.0			56,768.3			46,491.6
Stockholders’ Equity
Common Stock, $1.66 2/3 Par Value; Authorized 560,000,000 shares; Outstanding 219,407,279 shares at March 2007, 218,700,956 shares at December 2006 and 218,046,297 shares at March 2006		379.8			379.8			379.8
Additional Paid-In Capital		43.1			30.9			31.6
Retained Earnings		4,190.4			4,131.2			3,785.0
Accumulated Other Comprehensive Income		(154.5	)		(148.6	)		(27.0	)
Treasury Stock (at cost, 8,514,245 shares at March 2007, 9,220,568 shares at December 2006 and 9,875,227 shares at March 2006)		(415.4	)		(449.4	)		(466.0	)
Total Stockholders’ Equity		4,043.4			3,943.9			3,703.4
Total Liabilities and Stockholders’ Equity	$	59,532.4		$	60,712.2		$	50,195.0

2

CONSOLIDATED STATEMENT OF INCOME NORTHERN TRUST CORPORATION

	Three Months Ended March 31
($ In Millions Except Per Share Information)	2007		2006
Noninterest Income
Trust, Investment and Other Servicing Fees	$	488.9	$	442.5
Foreign Exchange Trading Income		67.2		55.8
Treasury Management Fees		16.2		17.0
Security Commissions and Trading Income		14.0		15.6
Other Operating Income		27.1		21.4
Investment Security Gains, net		.1		.1
Total Noninterest Income		613.5		552.4
Net Interest Income
Interest Income		636.3		477.1
Interest Expense		441.6		301.8
Net Interest Income		194.7		175.3
Provision for Credit Losses		—		4.0
Net Interest Income after Provision for Credit Losses		194.7		171.3
Noninterest Expenses
Compensation		244.7		216.7
Employee Benefits		56.6		55.3
Outside Services		84.1		74.9
Equipment and Software Expense		50.9		47.9
Occupancy Expense		38.0		35.1
Other Operating Expenses		51.6		43.4
Total Noninterest Expenses		525.9		473.3
Income before Income Taxes		282.3		250.4
Provision for Income Taxes		95.6		87.4
Net Income	$	186.7	$	163.0
Per Common Share
Net Income - Basic	$	.85	$	.75
- Diluted		.84		.74
Cash Dividends Declared		.25		.23
Average Number of Common Shares Outstanding - Basic		218,800,423		217,645,991
- Diluted		223,191,390		221,475,369

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME NORTHERN TRUST CORPORATION

	Three Months Ended March 31
($ In Millions)	2007			2006
Net Income	$	186.7		$	163.0
Other Comprehensive Income (net of tax and reclassifications)
Net Unrealized Gains (Losses) on Securities Available for Sale		1.5			(1.8	)
Net Unrealized Losses on Cash Flow Hedge Designations		(1.2	)		(.5	)
Foreign Currency Translation Adjustments		(7.7	)		(6.0	)
Pension and Other Postretirement Benefit Adjustments		1.5			—
Other Comprehensive Income		(5.9	)		(8.3	)
Comprehensive Income	$	180.8		$	154.7

3

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - NORTHERN TRUST CORPORATION

	Three Months Ended March 31
(In Millions)	2007			2006
Common Stock
Balance at January 1 and March 31	$	379.8		$	379.8
Additional Paid-In Capital
Balance at January 1		30.9			—
Transferred from Common Stock Issuable - Stock Incentive Plans		—			55.5
Transferred from Deferred Compensation		—			(29.5	)
Treasury Stock Transaction - Stock Options and Awards		(9.1	)		(13.2	)
Stock Options and Awards - Amortization		15.3			14.2
Stock Options and Awards - Taxes		6.0			4.6
Balance at March 31		43.1			31.6
Retained Earnings
Balance at January 1, as Previously Reported		4,131.2			3,672.1
Adjustment for the Cummulative Effect of Applying FSP 13-2 (Note 2)		(72.3	)		—
Balance at January 1, as Restated		4,058.9			3,672.1
Net Income		186.7			163.0
Dividends Declared - Common Stock		(55.2	)		(50.1	)
Balance at March 31		4,190.4			3,785.0
Accumulated Other Comprehensive Income
Balance at January 1		(148.6	)		(18.7	)
Other Comprehensive (Loss)		(5.9	)		(8.3	)
Balance at March 31		(154.5	)		(27.0	)
Common Stock Issuable - Stock Incentive Plans
Balance at January 1		—			55.5
Transferred to Additional Paid-in Capital		—			(55.5	)
Balance at March 31		—			—
Deferred Compensation
Balance at January 1		—			(29.5	)
Transferred to Additional Paid-in Capital		—			29.5
Balance at March 31		—			—
Treasury Stock
Balance at January 1		(449.4	)		(458.4	)
Stock Options and Awards		36.7			30.6
Stock Purchased		(2.7	)		(38.2	)
Balance at March 31		(415.4	)		(466.0	)
Total Stockholders’ Equity at March 31	$	4,043.4		$	3,703.4

4

CONSOLIDATED STATEMENT OF CASH FLOWS NORTHERN TRUST CORPORATION

	Three Months Ended March 31
(In Millions)	2007			2006
Cash Flows from Operating Activities:
Net Income	$	186.7		$	163.0
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Provision for Credit Losses		—			4.0
Depreciation on Buildings and Equipment		19.7			19.5
Amortization of Computer Software		23.6			21.5
Amortization of Intangibles		5.3			5.4
Increase in Receivables		(21.0	)		(42.2	)
Decrease in Interest Payable		(12.0	)		(17.9	)
Amortization and Accretion of Securities and Unearned Income		(62.1	)		(28.1	)
Net (Increase) Decrease in Trading Account Securities		.5			(3.9	)
Other Operating Activities, net		(29.4	)		15.1
Net Cash Provided by Operating Activities		111.3			136.4
Cash Flows from Investing Activities:
Net (Increase) Decrease in Federal Funds Sold and Securities Purchased under Agreements to Resell		(1,623.6	)		3,933.3
Net Increase in Time Deposits with Banks		(1,128.7	)		(758.4	)
Net Decrease in Other Interest-Bearing Assets		1.1			39.7
Purchases of Securities-Held to Maturity		(32.8	)		(21.8	)
Proceeds from Maturity and Redemption of Securities-Held to Maturity		31.7			34.3
Purchases of Securities-Available for Sale		(17,504.0	)		(33,439.8	)
Proceeds from Sale, Maturity and Redemption of Securities-Available for Sale		17,455.3			33,625.0
Net (Increase) Decrease in Loans and Leases		871.8			(60.6	)
Purchases of Buildings and Equipment, net		(15.5	)		(9.4	)
Purchases and Development of Computer Software		(45.7	)		(38.5	)
Net Decrease in Trust Security Settlement Receivables		58.3			25.5
Other Investing Activities, net		666.7			(289.7	)
Net Cash Provided by (Used in) Investing Activities		(1,265.4	)		3,039.6
Cash Flows from Financing Activities:
Net Increase (Decrease) in Deposits		3,199.4			(3,910.7	)
Net Increase (Decrease) in Federal Funds Purchased		(2,026.0	)		1,312.8
Net Increase (Decrease) in Securities Sold under Agreements to Repurchase		(762.0	)		733.3
Net Increase (Decrease) in Commercial Paper		—			.9
Net Decrease in Short-Term Other Borrowings		(2,562.4	)		(1,278.7	)
Proceeds from Term Federal Funds Purchased		10.0			3.0
Repayments of Term Federal Funds Purchased		(22.0	)		(3.0	)
Proceeds from Senior Notes & Long-Term Debt		650.0			—
Repayments of Senior Notes & Long-Term Debt		(274.4	)		(163.9	)
Treasury Stock Purchased		(1.5	)		(37.5	)
Net Proceeds from Stock Options		26.3			16.8
Excess Tax Benefits from Stock Incentive Plans		6.0			4.7
Cash Dividends Paid on Common Stock		(54.6	)		(50.1	)
Other Financing Activities, net		573.2			(2.8	)
Net Cash Used in Financing Activities		(1,238.0	)		(3,375.2	)
Effect of Foreign Currency Exchange Rates on Cash		2.6			18.4
Decrease in Cash and Due from Banks		(2,389.5	)		(180.8	)
Cash and Due from Banks at Beginning of Year		4,961.0			2,996.2
Cash and Due from Banks at End of Period	$	2,571.5		$	2,815.4
Supplemental Disclosures of Cash Flow Information:
Interest Paid	$	453.6		$	319.7
Income Taxes Paid		21.2			.8

5

Notes to Consolidated Financial Statements

1. Basis of Presentation - The consolidated financial statements include the accounts of Northern Trust Corporation (Corporation) and its subsidiaries (collectively, Northern Trust), all of which are wholly-owned. Significant intercompany balances and transactions have been eliminated. The consolidated financial statements, as of March 31, 2007 and 2006, have not been audited by the Corporation’s independent registered public accounting firm. In the opinion of management, all accounting entries and adjustments, including normal recurring accruals, necessary for a fair presentation of the financial position and the results of operations for the interim periods have been made. Expenses associated with outside services purchased, previously included as a component of other operating expenses within the consolidated statement of income, are now included as a separate component of noninterest expenses due to the increased significance of this expense category. The amortization of capitalized software, also previously included as a component of other operating expenses, is now included as a component of equipment and software expense in order to better align the nature of this expense with its income statement classification. All prior period amounts have been reclassified consistent with the current period’s presentations. For a description of Northern Trust’s significant accounting policies, refer to Note 1 of the Notes to Consolidated Financial Statements in the 2006 Financial Annual Report to Shareholders.

2. Recent Accounting Pronouncements - On July 13, 2006, the Financial Accounting Standards Board (FASB) issued its Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement 109” (FIN 48), which provides guidance on the measurement, recognition, and disclosure of tax positions taken or expected to be taken in a tax return. The Interpretation also provides guidance on derecognition, classification, interest and penalties, and disclosure. FIN 48 prescribes that a tax position should only be recognized if it is more likely than not that the position will be sustained upon examination by the appropriate taxing authority. A tax position that meets this threshold is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. The cumulative effect of applying the provisions of FIN 48 is to be reported as an adjustment to the beginning balance of retained earnings in the period of adoption. Adoption of FIN 48 as of January 1, 2007 did not impact Northern Trust’s consolidated financial position or results of operations.

On July 13, 2006, the FASB issued Staff Position No. FAS 13-2, “Accounting for a Change or Projected Change in the Timing of Cash Flows Relating to Income Taxes Generated by a Leveraged Lease Transaction” (FSP 13-2), which amends FASB Statement No. 13, “Accounting for Leases.” This Staff Position addresses how a change or projected change in the timing of cash flows relating to income taxes generated by a leveraged lease affects the accounting by a lessor for that lease. FSP 13-2 requires a recalculation of the rate of return and allocation of income from the inception of a leveraged lease if, during the lease term, the expected timing of the income tax cash flows generated by a leveraged lease is revised. The recalculation includes actual cash flows that occurred up to the date of the recalculation and projected cash flows thereafter. The change in the leveraged lease net investment balances as a result of the recalculation is recognized as a gain or loss in the year that the estimated cash flows change. Additionally, a lessor must apply the provisions of FIN 48 to its tax

6

Notes to Consolidated Financial Statements (continued)

positions when initially calculating or subsequently recalculating leveraged lease cash flows and determining the related income allocation. The cumulative effect of applying the provisions of this Staff Position is reported as an adjustment to the beginning balance of retained earnings in the period of adoption. Based on current estimates relating to the outcome of future events, adoption as of January 1, 2007 reduced Northern Trust’s stockholders’ equity by $72.3 million and is expected to reduce 2007 net income by approximately $8 million. These amounts will be recognized into income over the remaining term of the affected leveraged leases.

In September 2006, the FASB issued FASB Statement No. 157 (SFAS No. 157), “Fair Value Measurements.” SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and enhances disclosures about fair value measurements required under other accounting pronouncements, but does not change existing guidance as to whether or not an instrument is carried at fair value. Disclosures required to be provided include information on the inputs used to develop fair value measurements and the effect of the measurements on earnings. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. Adoption of SFAS No. 157 as of January 1, 2008 is currently not expected to have a material impact on Northern Trust’s consolidated financial position or results of operations.

In February 2007, the FASB issued FASB Statement No. 159 (SFAS No. 159), “The Fair Value Option for Financial Assets and Financial Liabilities.” SFAS No. 159 gives entities the option, at specified election dates, to measure certain financial assets and liabilities at fair value. The election may be applied to financial assets and liabilities on an instrument by instrument basis, is irrevocable, and may only be applied to entire instruments. Unrealized gains and losses on instruments for which the fair value option has been elected will be reported in earnings at each subsequent reporting date. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007. Adoption of SFAS No. 159 as of January 1, 2008 is currently not expected to have a material impact on Northern Trust’s consolidated financial position or results of operations.

3. Stock-Based Compensation Plans - The Northern Trust Corporation 2002 Stock Plan (2002 Plan), administered by the Compensation Committee of the Corporation’s Board of Directors, provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, stock units, and performance shares. On April 17, 2007, the 2002 Plan was amended and restated, increasing the number of shares available for future grant by 18,000,000 to 22,540,618 shares.

In the first quarter of 2007, Northern Trust granted 1,368,429 stock options with a total grant-date fair value of $23.8 million, 173,928 stock unit awards with a total grant-date fair value of $11.0 million, and 393,518 performance stock units with a total grant-date fair value of $24.9 million. Included in the compensation expense recorded in the first quarter of 2007 related to stock options was $6.3 million attributable to options granted in the first quarter of 2007 to retirement-eligible employees, which were expensed in their entirety on the grant date. Compensation expense recorded in the first quarter of 2006 included $7.5 million attributable to options granted to retirement-eligible employees.

7

Notes to Consolidated Financial Statements (continued)

Total compensation expense for share-based payment arrangements and the associated tax benefits recognized were as follows:

	Three Months Ended March 31
(In Millions)	2007		2006
Stock Options	$	9.2	$	10.2
Stock and Stock Unit Awards		3.8		4.0
Performance Stock Units		2.3		.3
Total Share-Based Compensation Expense	$	15.3	$	14.5
Tax Benefits Recognized	$	5.8	$	5.5

4. Securities - The following table summarizes the book and fair values of securities.

	March 31, 2007				December 31, 2006				March 31, 2006
(In Millions)	Book Value		Fair Value		Book Value		Fair Value		Book Value		Fair Value
Available for Sale
U.S. Government	$	6.1	$	6.1	$	1.0	$	1.0	$	13.0	$	13.0
Obligations of States and
Political Subdivisions		31.8		31.8		31.7		31.7		31.5		31.5
Government Sponsored Agency		10,311.8		10,311.8		10,245.1		10,245.1		8,994.0		8,994.0
Preferred Stock		9.8		9.8		9.8		9.8		9.8		9.8
Asset-Backed		858.0		858.0		767.4		767.4		779.4		779.4
Other		222.2		222.2		194.6		194.6		163.5		163.5
Subtotal		11,439.7		11,439.7		11,249.6		11,249.6		9,991.2		9,991.2
Held to Maturity
Obligations of States and
Political Subdivisions		855.0		877.7		863.8		888.5		873.6		893.6
Government Sponsored Agency		14.3		14.2		14.6		14.5		9.7		9.4
Other		239.9		230.9		228.6		219.1		243.3		236.2
Subtotal		1,109.2		1,122.8		1,107.0		1,122.1		1,126.6		1,139.2
Trading Account		8.1		8.1		8.6		8.6		6.7		6.7
Total Securities	$	12,557.0	$	12,570.6	$	12,365.2	$	12,380.3	$	11,124.5	$	11,137.1

Reconciliation of Amortized Cost to Fair Values of Securities Available for Sale

	March 31, 2007
(In Millions)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses
U.S. Government	$	6.1	$	—	$	—	$	6.1
Obligations of States and Political Subdivisions		30.6		1.2		—		31.8
Government Sponsored Agency		10,315.3		2.0		5.5		10,311.8
Preferred Stock		9.8		—		—		9.8
Asset-Backed		858.8		.4		1.2		858.0
Other		210.8		11.4		—		222.2
Total	$	11,431.4	$	15.0	$	6.7	$	11,439.7

8

Notes to Consolidated Financial Statements (continued)

Reconciliation of Book Values to Fair Values of Securities Held to Maturity

	March 31, 2007
(In Millions)	Book Value		Gross Unrealized				Fair Value
			Gains		Losses
Obligations of States and Political Subdivisions	$	855.0	$	24.0	$	1.3	$	877.7
Government Sponsored Agency		14.3		.1		.2		14.2
Other		239.9		—		9.0		230.9
Total	$	1,109.2	$	24.1	$	10.5	$	1,122.8

5. Loans and Leases - Amounts outstanding in selected loan categories are shown below.

(In Millions)	March 31, 2007			December 31, 2006			March 31, 2006
U.S.
Residential Real Estate	$	8,679.2		$	8,674.4		$	8,345.8
Commercial		4,884.4			4,679.1			3,772.2
Commercial Real Estate		1,902.3			1,836.3			1,576.1
Personal		2,947.0			3,415.8			2,957.6
Other		803.2			979.2			1,012.3
Lease Financing		1,178.3			1,291.6			1,193.7
Total U.S.		20,394.4			20,876.4			18,857.7
Non-U.S.		1,263.8			1,733.3			1,182.9
Total Loans and Leases	$	21,658.2		$	22,609.7		$	20,040.6
Reserve for Credit Losses Assigned to Loans and Leases		(138.3	)		(140.4	)		(129.3	)
Net Loans and Leases	$	21,519.9		$	22,469.3		$	19,911.3

Other U.S. loans and non-U.S. loans included $1.2 billion at March 31, 2007, $1.7 billion at December 31, 2006, and $1.1 billion at March 31, 2006 of short duration advances, primarily related to the processing of custodied client investments.

The following table shows outstanding amounts of nonperforming and impaired loans for the quarters ended March 31, 2007 and March 31, 2006.

(In Millions)	March 31, 2007		March 31, 2006
Nonperforming Loans	$	35.1	$	31.1
Impaired Loans with Reserves	$	21.3	$	24.5
Impaired Loans without Reserves*		10.5		3.3
Total Impaired Loans	$	31.8	$	27.8
Reserves for Impaired Loans	$	16.4	$	19.0
Average Balance of Impaired Loans during the Quarter		32.9		27.5

* When an impaired loan’s discounted cash flows, collateral value, or market price equals or exceeds its carrying value, a reserve is not required.

There was $261 thousand of interest recorded on impaired loans in the current quarter, compared with no interest income recorded on impaired loans for the quarter ended March 31, 2006, respectively.

9

Notes to Consolidated Financial Statements (continued)

At March 31, 2007, residential real estate loans totaling $1.2 million were held for sale and carried at the lower of cost or market. Loan commitments for residential real estate loans that will be held for sale when funded are carried at fair value and had a total notional amount of $7.3 million at March 31, 2007. All other loan commitments are carried at the amount of unamortized fees with a reserve for credit loss liability recognized for any probable losses. At March 31, 2007, legally binding commitments to extend credit totaled $20.6 billion compared with $20.0 billion at December 31, 2006 and $18.4 billion at March 31, 2006.

6. Reserve for Credit Losses - Changes in the reserve for credit losses were as follows:

	Three Months Ended March 31
(In Millions)	2007			2006
Balance at Beginning of Period	$	151.0		$	136.0
Charge-Offs		(2.3	)		(.4	)
Recoveries		.1			.3
Net (Charge-Offs) Recoveries		(2.2	)		(.1	)
Provision for Credit Losses		—			4.0
Balance at End of Period	$	148.8		$	139.9
Reserve for Credit Losses Assigned to:
Loans and Leases	$	138.3		$	129.3
Unfunded Commitments and Standby Letters of Credit		10.5			10.6
Total Reserve for Credit Losses	$	148.8		$	139.9

The reserve for credit losses represents management’s estimate of probable inherent losses that have occurred as of the date of the financial statements. The loan and lease portfolio and other credit exposures are regularly reviewed to evaluate the adequacy of the reserve for credit losses. In determining the level of the reserve, Northern Trust evaluates the reserve necessary for specific nonperforming loans and also estimates losses inherent in other credit exposures.

The result is a reserve with the following components:

Specific Reserve. The amount of specific reserves is determined through a loan-by-loan analysis of nonperforming loans that considers expected future cash flows, the value of collateral, and other factors that may impact the borrower’s ability to pay.

Allocated Inherent Reserve. The amount of the allocated portion of the inherent loss reserve is based on loss factors assigned to Northern Trust’s credit exposures based on internal credit ratings. These loss factors are primarily based on management’s judgment of estimated credit losses inherent in the loan portfolio as well as historical charge-off experience.

10

Notes to Consolidated Financial Statements (continued)

Unallocated Inherent Reserve. Management determines the unallocated portion of the inherent loss reserve based on factors that cannot be associated with a specific credit or loan category. These factors include management’s subjective evaluation of local, national, and international economic and business conditions, portfolio concentration, and changes in the character and size of the loan portfolio. The unallocated portion of the inherent loss reserve reflects management’s recognition of the imprecision inherent in the process of estimating probable credit losses.

7. Goodwill and Other Intangibles - Goodwill and other intangible assets are included in other assets in the consolidated balance sheet. The following table shows the changes in the carrying amount of goodwill by business unit for the three months ended March 31, 2007.

(In Millions)	Corporate and Institutional Services			Personal Financial Services		Total
Balance at December 31, 2006	$	361.7		$	60.8	$	422.5
Other Changes *		(.4	)		—		(.4	)
Balance at March 31, 2007	$	361.3		$	60.8	$	422.1

* Other changes in goodwill include the effect of foreign exchange rates on non-U.S. dollar denominated goodwill.

The gross carrying amount and accumulated amortization of other intangible assets at March 31, 2007 and March 31, 2006, was as follows:

Other Intangible Assets-Subject to Amortization *

	March 31
(In Millions)	2007		2006
Gross Carrying Amount	$	247.7	$	234.8
Accumulated Amortization		127.5		105.2
Net Book Value	$	120.2	$	129.6

* Includes the effect of foreign exchange rates on non-U.S. dollar denominated intangible assets.

Other intangible assets consist primarily of the value of acquired client relationships. Amortization expense related to other intangible assets totaled $5.3 million and $5.4 million for the quarters ended March 31, 2007 and March 31, 2006, respectively. Amortization for the remainder of 2007 and for the years 2008, 2009, 2010, and 2011 is estimated to be $15.5 million, $18.6 million, $18.1 million, $16.2 million and $12.5 million, respectively.

11

Notes to Consolidated Financial Statements (continued)

8. Accumulated Other Comprehensive Income - The following tables summarize the components of accumulated other comprehensive income at March 31, 2007 and 2006, and changes during the three-month periods then ended, presented on an after-tax basis.

	Three Months Ended March 31, 2007
	Beginning Balance (Net of Tax)			Period Change						Ending Balance (Net of Tax)
				Pre-Tax Amount			Tax Effect
(In Millions)
Unrealized Gains (Losses) on Securities Available for Sale	$	4.5		$	2.6		$	(1.0	)	$	6.1
Less: Reclassification Adjustments		—			.1			—			.1
Net Unrealized Gains (Losses) on Securities Available for Sale		4.5			2.5			(1.0	)		6.0
Unrealized Gains (Losses) on Cash Flow Hedge Designations		2.2			(5.1	)		1.9			(1.0	)
Less: Reclassification Adjustments		—			(3.2	)		1.2			(2.0	)
Net Unrealized Gains (Losses) on Cash Flow Hedge Designations		2.2			(1.9	)		.7			1.0
Pension and Other Postretirement Benefit Adjustments		(173.8	)		—			—			(173.8	)
Less: Reclassification Adjustments		—			5.4			(3.9	)		1.5
Total Pension and Other Postretirement Benefit Adjustments		(173.8	)		5.4			(3.9	)		(172.3	)
Foreign Currency Translation Adjustments		18.5			(2.9	)		(4.8	)		10.8
Accumulated Other Comprehensive Income	$	(148.6	)	$	3.1		$	(9.0	)	$	(154.5	)
	Three Months Ended March 31, 2006
	Beginning Balance (Net of Tax)			Period Change						Ending Balance (Net of Tax)
				Pre-Tax Amount			Tax Effect
(In Millions)
Unrealized Gains (Losses) on Securities Available for Sale	$	(5.2	)	$	(2.7	)	$	.9		$	(7.0	)
Less: Reclassification Adjustments		—			—			—			—
Net Unrealized Gains (Losses) on Securities Available for Sale		(5.2	)		(2.7	)		.9			(7.0	)
Unrealized Gains (Losses) on Cash Flow Hedge Designations		(.8	)		(3.2	)		1.2			(2.8	)
Less: Reclassification Adjustments		—			(2.5	)		1.0			(1.5	)
Net Unrealized Gains (Losses) on Cash Flow Hedge Designations		(.8	)		(.7	)		.2			(1.3	)
Minimum Pension Liability		(14.2	)		—			—			(14.2	)
Foreign Currency Translation Adjustments		1.5			(8.4	)		2.4			(4.5	)
Accumulated Other Comprehensive Income	$	(18.7	)	$	(11.8	)	$	3.5		$	(27.0	)

12

Notes to Consolidated Financial Statements (continued)

9. Net Income Per Common Share Computations - The computation of net income per common share is presented in the following table.

	Three Months Ended March 31
($ In Millions Except Per Share Information)	2007		2006
Basic Net Income Per Common Share
Average Number of Common Shares Outstanding		218,800,423		217,645,991
Net Income	$	186.7	$	163.0
Basic Net Income Per Common Share	$	.85	$	.75
Diluted Net Income Per Common Share
Average Number of Common Shares Outstanding		218,800,423		217,645,991
Plus Dilutive Potential Common Shares:
Stock Options		3,278,520		2,840,598
Stock Incentive Plans		1,112,447		988,780
Average Common and Potential Common Shares		223,191,390		221,475,369
Net Income	$	186.7	$	163.0
Diluted Net Income Per Common Share	$	.84	$	.74

Note: For the quarters ended March 31, 2007 and 2006, options to purchase 6,148,087 and 6,060,018 shares of the Corporation’s common stock, respectively, were not included in the computation of diluted earnings per share because the exercise prices were greater than the average market price of Northern Trust’s common stock during these periods.

10. Net Interest Income - The components of net interest income were as follows:

	Three Months Ended March 31
(In Millions)	2007		2006
Interest Income
Loans and Leases	$	299.4	$	250.3
Securities – Taxable		148.1		108.4
– Non-Taxable		9.7		10.0
Time Deposits with Banks		162.5		97.3
Federal Funds Sold and Securities Purchased under Agreements to Resell and Other		16.6		11.1
Total Interest Income		636.3		477.1
Interest Expense
Deposits		352.4		211.7
Federal Funds Purchased		16.9		17.9
Securities Sold Under Agreements to Repurchase		20.9		21.1
Commercial Paper		—		1.6
Other Borrowings		6.3		3.7
Senior Notes		5.8		2.9
Long-Term Debt		35.3		39.3
Floating Rate Capital Debt		4.0		3.6
Total Interest Expense		441.6		301.8
Net Interest Income	$	194.7	$	175.3

13

Notes to Consolidated Financial Statements (continued)

11. Income Taxes - Total income tax expense for the quarter was $95.6 million, an effective tax rate of 33.9%, compared with $87.4 million in the prior year, an effective rate of 34.9%. The lower effective rate in the current quarter reflects management’s decision to indefinitely reinvest the earnings of certain non-U.S. subsidiaries.

The Corporation files income tax returns in the U.S. federal, various state, and foreign jurisdictions. The Corporation is no longer subject to income tax examinations by U.S. federal, state, or local, or by non-U.S tax authorities for years before 1997. As of the date of adoption of FIN 48, discussed in Note 2, “Recent Accounting Pronouncements,” $24.4 million of unrecognized tax benefits were included in other liabilities within the consolidated balance sheet. If recognized, all of the tax benefits would increase net income, resulting in a decrease of the effective income tax rate. Management does not anticipate significant adjustments to the total amount of unrecognized tax benefits within the next twelve months. Additionally, included in other liabilities within the consolidated balance sheet were $167 million of tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. Because of the impact of deferred tax accounting, other than interest and penalties, the disallowance of accelerated deductions would not affect the annual effective tax rate but would accelerate the payment of cash to tax authorities to an earlier period.

Northern Trust recognizes any interest and penalties related to unrecognized tax benefits in the provision for income taxes. As of the date of adoption of FIN 48, approximately $59.6 million, $39.4 million net of tax, was accrued for the potential payment of interest and penalties.

12. Pension and Other Postretirement Plans - The following tables set forth the net periodic pension cost of the U.S. and non-U.S. pension plans, the supplemental pension plan, and the other postretirement plan for the three months ended March 31, 2007 and 2006.

Net Periodic Pension Expense

U.S. Plan

	Three Months Ended March 31
(In Millions)	2007			2006
Service Cost	$	7.7		$	7.3
Interest Cost		7.2			6.9
Expected Return on Plan Assets		(12.1	)		(9.5	)
Amortization:
Net Loss		3.7			3.9
Prior Service Cost		.3			.3
Net Periodic Pension Expense	$	6.8		$	8.9

14

Notes to Consolidated Financial Statements (continued)

Net Periodic Pension Expense

Non-U.S. Plan

	Three Months Ended March 31
(In Millions)	2007			2006
Service Cost	$	1.4		$	1.4
Interest Cost		1.6			1.2
Expected Return on Plan Assets		(2.0	)		(1.6	)
Net Loss Amortization		.3			.3
Net Periodic Pension Expense	$	1.3		$	1.3

Net Periodic Pension Expense

Supplemental Plan

	Three Months Ended March 31
(In Millions)	2007		2006
Service Cost	$	.5	$	.6
Interest Cost		.9		.8
Expected Return on Plan Assets		—		—
Net Loss Amortization		.7		.7
Net Periodic Pension Expense	$	2.1	$	2.1

Net Periodic Benefit Expense

Other Postretirement Plan

	Three Months Ended March 31
(In Millions)	2007		2006
Service Cost	$	.5	$	.4
Interest Cost		.9		.9
Amortization:
Transition Obligation		.1		.1
Net Loss		.3		.5
Net Periodic Benefit Expense	$	1.8	$	1.9

13. Contingent Liabilities - Standby letters of credit obligate Northern Trust to meet certain financial obligations of its clients, if, under the contractual terms of the agreement, the clients are unable to do so. These instruments are primarily issued to support public and private financial commitments, including commercial paper, bond financing, initial margin requirements on futures exchanges and similar transactions. Certain standby letters of credit have been secured with cash deposits or participated to others. Northern Trust is obligated to meet the entire financial obligation of these agreements and in certain cases is able to recover the amounts paid through recourse against cash deposits or other participants. Standby letters of credit outstanding were $2.8 billion on March 31, 2007, $2.7 billion on December 31, 2006 and $2.7 billion on March 31, 2006. Northern Trust’s liability included within the consolidated balance sheet for standby letters of credit, measured as the amount of unamortized fees on these instruments, was $13.9 million at March 31, 2007, $7.9 million at December 31, 2006, and $7.6 million at March 31, 2006.

As part of securities custody activities and at the direction of its clients, Northern Trust lends securities owned by clients to borrowers who are reviewed by the Credit Policy Credit Approval Committee. In connection with these activities, Northern Trust has issued certain indemnifications against loss resulting from the bankruptcy of the borrower of the securities. The borrowing party is required to fully collateralize securities received with cash, marketable securities, or irrevocable standby letters of credit. As securities are loaned, collateral is maintained at a minimum of 100 percent of the fair value of the securities plus accrued

15

Notes to Consolidated Financial Statements (continued)

interest. The collateral is revalued on a daily basis. The amount of securities loaned subject to indemnification was $193.5 billion at March 31, 2007, $156.7 billion at December 31, 2006, and $152.0 billion at March 31, 2006. Because of the requirement to fully collateralize securities borrowed, management believes that the exposure to credit loss from this activity is remote and there are no liabilities reflected within the consolidated balance sheet at March 31, 2007, December 31, 2006, or March 31, 2006 related to these indemnifications.

In the normal course of business, the Corporation and its subsidiaries are routinely defendants in or parties to a number of pending and threatened legal actions, including actions brought on behalf of various classes of claimants, regulatory matters, and challenges from tax authorities regarding the amount of taxes due. In certain of these actions and proceedings, claims for substantial monetary damages or adjustments to recorded tax liabilities are asserted. In view of the inherent difficulty of predicting the outcome of such matters, particularly actions that seek very large damages based on novel and complex damage and liability legal theories or that involve a large number of parties, the Corporation cannot state with confidence the eventual outcome of these matters or the timing of their ultimate resolution, or estimate the possible loss or range of loss associated with them; however, based on current knowledge and after consultation with legal counsel, management does not believe that judgments or settlements, if any, arising from pending or threatened legal actions, regulatory matters or challenges from tax authorities, either individually or in the aggregate, would have a material adverse effect on the consolidated financial position or liquidity of the Corporation, although they could have a material adverse effect on operating results for a particular period.

In November and December 2003, Enron Corp. as debtor-in-possession filed two lawsuits in the bankruptcy court in New York seeking to recover for its bankruptcy estate more than $1 billion paid by Enron in the fall of 2001 to buy back its commercial paper. Enron claims that the money it paid to buy back its commercial paper approximately six weeks prior to its bankruptcy filing represented “preference” payments and “constructive fraudulent transfers” that can be reversed with the money going back to Enron. Since The Northern Trust Company (Bank), a wholly-owned subsidiary of the Corporation, sold approximately $197 million of this Enron commercial paper that it held for some of its clients to a third party broker, the Bank and those clients are among scores of defendants named in these complaints. In June 2005, the bankruptcy judge denied the defendants’ motions to dismiss the complaints. Defendants filed petitions with the Federal District Court for the Southern District of New York seeking review of the bankruptcy court ruling. The Securities and Exchange Commission, the Federal Reserve Board, and the United States Treasury Department also filed briefs supporting defendants’ position urging the District Court to review the ruling. During the first quarter of 2007, the Bank reached a tentative agreement with Enron to settle the matter. The settlement has not been documented and will require bankruptcy court approval. Based on the terms of the tentative agreement, appropriate reserves have been accrued for the matter.

16

Notes to Consolidated Financial Statements (continued)

As part of its audit of federal tax returns filed from 1997 – 2000, the IRS challenged the Corporation’s tax position with respect to thirteen investments made in structured leasing transactions and proposed to disallow certain tax deductions and assess related interest and penalties. During the second quarter of 2005, the IRS issued a revised examination report that continued to disallow certain tax deductions and included additional proposed adjustments to income and penalty assessments. The Corporation anticipates that the IRS will continue to disallow deductions relating to these leases and possibly include other lease transactions with similar characteristics as part of its audit of tax returns filed after 2000. In October 2005, the IRS Tax Appeals Division informed the Corporation that the Criminal Investigation Division of the IRS had initiated an investigation relating to structured leasing transactions in which the Corporation had participated. The Corporation was informed in February 2007 that the IRS, without a recommendation for prosecution, referred this matter to the United States Attorney’s Office for the Northern District of Illinois for further investigation through the grand jury process. The Corporation has been advised by the government that it is not a target of the investigation. The Corporation is cooperating fully in the investigation. The Corporation does not know the full scope of the investigation and cannot predict at this time the impact of the investigation or when or on what basis the investigation will be resolved. The Corporation believes that these transactions are valid leases for U.S. tax purposes and that its tax treatment of these transactions is appropriate based on its interpretation of the tax regulations and legal precedents; a court or other judicial authority, however, could disagree. The Corporation believes it has appropriate reserves to cover its tax liabilities, including liabilities related to structured leasing transactions, and related interest and penalties. The Corporation will continue to defend its position on the tax treatment of the leases vigorously.

14. Pledged Assets - Securities and loans pledged to secure public and trust deposits, repurchase agreements, and for other purposes as required or permitted by law were $14.3 billion on March 31, 2007, $15.8 billion on December 31, 2006 and $10.7 billion on March 31, 2006. Included in the March 2007 pledged assets were securities available for sale of $1.2 billion that were pledged as collateral for agreements to repurchase securities sold transactions. The secured parties to these transactions have the right to repledge or sell these securities.

Northern Trust is permitted to repledge or sell collateral from agreements to resell securities purchased transactions. The total fair value of accepted collateral as of March 31, 2007, December 31, 2006, and March 31, 2006 was $538.8 million, $415.2 million, and $372.9 million, respectively. There was no repledged collateral at March 31, 2007, December 31, 2006, or March 31, 2006.

15. Business Units - The table on page 23, reflecting the earnings contribution of Northern Trust’s business units for the three-month periods ended March 31, 2007, is incorporated by reference.

17

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FIRST QUARTER CONSOLIDATED RESULTS OF OPERATIONS

Overview

Net income per common share on a diluted basis for the first quarter was $.84, an increase of 14% from $.74 per share earned in last year’s first quarter. Net income increased 15% to $186.7 million, up from $163.0 million earned in the first quarter of last year. This performance produced an annualized return on average common equity (ROE) of 19.21% versus 18.22% reported for the comparable quarter last year and an annualized return on average assets (ROA) of 1.33%, unchanged from last year.

Revenues stated on a fully taxable equivalent (FTE) basis of $823.8 million were up 11% from $743.0 million in last year’s first quarter, reflecting trust, investment and other servicing fees of $488.9 million, up 10% from the first quarter of last year. Net interest income was up 10% from a year ago to $210.3 million on a FTE basis and foreign exchange trading income was up 20% to $67.2 million. Noninterest expenses totaled $525.9 million for the quarter, up 11% from $473.3 million in the year-ago quarter.

Noninterest Income

Noninterest income totaled $613.5 million for the quarter, up 11% from $552.4 million reported last year, and accounted for 74% of total taxable equivalent revenue. Trust, investment and other servicing fees were $488.9 million in the quarter, up 10% from $442.5 million in the first quarter of last year, and represented 59% of total taxable equivalent revenue. The increase resulted primarily from higher equity markets and new business. The components of noninterest income for the first quarter of 2007 and 2006 are listed in the following table:

Noninterest Income

	Three Months Ended March 31
(In Millions)	2007		2006
Trust, Investment and Other Servicing Fees	$	488.9	$	442.5
Foreign Exchange Trading Income		67.2		55.8
Treasury Management Fees		16.2		17.0
Security Commissions and Trading Income		14.0		15.6
Other Operating Income		27.1		21.4
Investment Security Gains		.1		.1
Total Noninterest Income	$	613.5	$	552.4

18

Noninterest Income (continued)

Assets under custody totaled $3.75 trillion at March 31, 2007. This represents an increase in assets under custody of 6% from December 31, 2006 and 20% from March 31, 2006. Assets under management totaled $755.8 billion compared with $697.2 billion at December 31, 2006 and $652.8 billion at March 31, 2006. As of the current quarter-end, managed assets were invested 35% in equities, 16% in fixed-income securities, and 49% in cash and other assets.

Assets Under Custody

(In Billions)	March 31, 2007		December 31, 2006		March 31, 2006
Corporate & Institutional	$	3,462.3	$	3,263.5	$	2,889.8
Personal		291.8		281.9		235.6
Total Assets Under Custody	$	3,754.1	$	3,545.4	$	3,125.4
Assets Under Management
(In Billions)	March 31, 2007		December 31, 2006		March 31, 2006
Corporate & Institutional	$	616.5	$	562.5	$	531.3
Personal		139.3		134.7		121.5
Total Assets Under Management	$	755.8	$	697.2	$	652.8

Trust, investment and other servicing fees are generally based on the market value of assets managed, custodied, and administered, the volume of transactions, securities lending volume and spreads, and fees for other services rendered. Certain investment management fee arrangements also may provide for performance fees, which are based on client portfolio returns exceeding predetermined levels. In addition, Corporate & Institutional Services (C&IS) client relationships are generally priced to reflect earnings from activities such as foreign exchange trading and custody-related deposits that are not included in trust, investment and other servicing fees. Based on analysis of historical trends and current asset and product mix, management estimates that a 10% rise or fall in overall equity markets would cause a corresponding increase or decrease in trust, investment and other servicing fees of approximately 4% and total revenues of approximately 2%.

Trust, investment and other servicing fees from C&IS in the quarter increased 8% to a record $274.2 million from the year-ago quarter, reflecting strong new business and higher equity markets. Growth in our international business resulted in a 12% increase in custody and fund administration fees to $140.7 million. Custody and fund administration fees in the prior year quarter included a nonrecurring revenue accrual of approximately $4.5 million. Securities lending fees totaled $45.6 million, down 6% compared with the exceptionally strong performance last year. Results were impacted by lower spreads on the investment of cash collateral, offset in part by higher volumes. Fees from asset management in the quarter grew 12% from the prior year to $71.5 million.

C&IS assets under custody totaled $3.5 trillion at March 31, 2007, up 20% from a year ago, and included $1.8 trillion of global custody assets, a 30% increase compared with a year ago. C&IS assets under management totaled $616.5 billion, a 16% increase from the prior year. As of the current quarter-end, C&IS managed assets were invested 32% in equities, 12% in fixed-income securities, and 56% in cash and other assets.

19

Noninterest Income (continued)

Trust, investment and other servicing fees from PFS in the quarter increased 14% and totaled a record $214.7 million compared with $188.9 million a year ago. The increase in PFS fees 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. PFS assets under custody totaled $291.8 billion at March 31, 2007, a 24% increase from $235.6 billion in the prior year. PFS assets under management totaled $139.3 billion, a 15% increase from $121.5 billion last year. As of the current quarter-end, PFS managed assets were invested 48% in equities, 33% in fixed-income securities, and 19% in cash and other assets.

Foreign exchange trading income of $67.2 million increased 20% from the prior year quarter, primarily driven by strong client volumes. Revenues from security commissions and trading income equaled $14.0 million, down 10% from the prior year. Other operating income, the components of which are listed below, was $27.1 million for the first quarter compared with $21.4 million in the same period last year. Approximately half of the increase in the other income category reflects the foreign exchange rate impact of translating non-U.S. assets and liabilities.

Other Operating Income

	Three Months Ended March 31
(In Millions)	2007		2006
Loan Service Fees	$	4.3	$	4.1
Banking Service Fees		8.6		8.9
Other Income		14.2		8.4
Total Other Operating Income	$	27.1	$	21.4

20

Net Interest Income

Net interest income for the quarter totaled $194.7 million, 11% higher than the $175.3 million reported in the first quarter of 2006. Net interest income is defined as the total of interest income and amortized fees on earning assets, less interest expense on deposits and borrowed funds, adjusted for the impact of hedging activities. When net interest income is adjusted to a FTE basis, yields on taxable, nontaxable and partially taxable assets are comparable, although the adjustment to a FTE basis has no impact on net income. Net interest income for the quarter, stated on a FTE basis, totaled $210.3 million, up 10% from $190.6 million reported in the prior year quarter. The increase reflects higher levels of average earning assets, partially offset by a decline in the net interest margin. The securities portfolio averaged $12.5 billion, up 13% from last year, with the increase concentrated primarily in variable rate government sponsored agency securities. Average loans and leases increased 9% to $21.4 billion, while money market assets increased 36% from the prior year and averaged $17.0 billion for the quarter. The net interest margin equaled 1.68%, down from 1.79% in the prior year quarter. The decline in the net interest margin reflects the significant growth in global custody-related deposits which have been invested primarily in short-term money market assets and securities.

Average U.S. loans outstanding during the quarter totaled $20.2 billion, 10% higher than the $18.3 billion in last year’s first quarter. Non-U.S. loans decreased $111 million on average from the prior year quarter to $1.2 billion. Residential mortgages averaged $8.7 billion in the quarter, up 4% from the prior year’s first quarter, and represented 41% of the total average loan and lease portfolio. Commercial loans averaged $4.7 billion, up 29% from $3.7 billion last year, while personal loans averaged $3.1 billion, up 6% from last year’s first quarter.

Northern Trust utilizes a diverse mix of funding sources. Total interest-related deposits averaged $36.7 billion, up 29% from the first quarter of 2006. Non-U.S. office time deposits increased $8.0 billion or 41% from last year’s first quarter, resulting primarily from growth in our international business. Retail deposit levels increased $197 million due primarily to higher levels of savings certificates, offset in part by lower balances in savings and now accounts. Other interest-related funds averaged $7.2 billion in the quarter compared with $8.8 billion in last year’s first quarter, and included the proceeds of $250 million of 5.30% fixed-rate, noncallable unsecured notes issued by the Corporation in August of 2006. The balances within these classifications vary based on funding requirements and strategies, interest rate levels, changes in the volume of lower-cost deposit sources, and the availability of collateral to secure these borrowings. Noninterest-related funds utilized to fund earning assets averaged $7.0 billion compared with $6.0 billion in last year’s first quarter.

Provision for Credit Losses

There was no provision for credit losses in the first quarter compared with $4.0 million in the prior year quarter. The reserve for credit losses at March 31, 2007 was $148.8 million compared with $151.0 million at December 31, 2006 and $139.9 million at March 31, 2006. For a discussion of the provision and reserve for credit losses, refer to the “Asset Quality” section beginning on page 27.

21

Noninterest Expense

Noninterest expenses totaled $525.9 million for the quarter, up 11% from $473.3 million in the year-ago quarter.

Noninterest Expenses

	Three Months Ended March 31
(In Millions)	2007		2006
Compensation	$	244.7	$	216.7
Employee Benefits		56.6		55.3
Outside Services		84.1		74.9
Equipment and Software Expense		50.9		47.9
Occupancy Expense		38.0		35.1
Other Operating Expenses		51.6		43.4
Total Noninterest Expenses	$	525.9	$	473.3

Compensation and employee benefit expenses totaled $301.3 million, up $29.3 million or 11% compared with last year. The current quarter increase was driven by increased staff levels, annual salary increases, higher performance-based compensation, and higher health care costs. Staff on a full-time equivalent basis at March 31, 2007 totaled 9,940, up 9% from a year ago.

Other expense categories totaled $224.6 million, up $23.3 million or 12% from $201.3 million last year. The current quarter increase reflects volume driven growth in global subcustody expense, higher expenses for technical and consulting services, a litigation reserve accrual, higher computer software amortization, and increased advertising costs.

22

Provision for Income Taxes

The provision for income taxes was $95.6 million for the first quarter resulting in an effective tax rate of 33.9%. In the prior year quarter, the provision for income taxes was $87.4 million and the effective tax rate was 34.9%. The lower effective rate reflects management’s decision to reinvest indefinitely the earnings of certain non-U.S. subsidiaries.

BUSINESS UNIT REPORTING

The following table reflects the earnings contribution and average assets of Northern Trust’s business units for the quarters ended March 31, 2007 and 2006.

Results of Operations

Three Months

	Corporate and Institutional Services						Personal Financial Services						Treasury and Other						Total Consolidated
($ In Millions)	2007			2006			2007			2006			2007			2006			2007			2006
Noninterest Income
Trust, Investment and Other Servicing Fees	$	274.2		$	253.6		$	214.7		$	188.9		$	—		$	—		$	488.9		$	442.5
Other		95.6			81.7			24.4			24.3			4.6			3.9			124.6			109.9
Net Interest Income (FTE) *		87.9			70.8			125.2			123.7			(2.8	)		(3.9	)		210.3			190.6
Revenues (FTE) *		457.7			406.1			364.3			336.9			1.8			—			823.8			743.0
Provision for Credit Losses		.4			4.3			(.4	)		(.3	)		—			—			—			4.0
Noninterest Expenses		267.9			238.5			225.6			209.7			32.4			25.1			525.9			473.3
Income before Income Taxes *		189.4			163.3			139.1			127.5			(30.6	)		(25.1	)		297.9			265.7
Provision for Income Taxes *		71.7			63.5			53.9			49.4			(14.4	)		(10.2	)		111.2			102.7
Net Income	$	117.7		$	99.8		$	85.2		$	78.1		$	(16.2	)	$	(14.9	)	$	186.7		$	163.0
Percentage of Consolidated Net Income		63	%		61	%		46	%		48	%		(9	)%		(9	)%		100	%		100	%
Average Assets	$	37,966.1		$	30,403.2		$	18,642.9		$	17,368.2		$	440.7		$	1,887.2		$	57,049.7		$	49,658.6

* Stated on a fully taxable equivalent basis (FTE). Total consolidated includes FTE adjustments of $15.6 million for 2007 and $15.3 million for 2006.

23

Corporate and Institutional Services

C&IS net income for the quarter totaled $117.7 million compared with $99.8 million reported in the first quarter of 2006. Noninterest income was $369.8 million, up 10% from $335.3 million in last year’s first quarter. Trust, investment and other servicing fees increased 8% from the year-ago quarter to a record $274.2 million, reflecting strong new business and higher equity markets. Growth in our international business resulted in a 12% increase in custody and fund administration fees to $140.7 million. Custody and fund administration fees in the prior year quarter included a nonrecurring revenue accrual of approximately $4.5 million. Securities lending fees totaled $45.6 million, down 6% compared with the exceptionally strong performance last year. Results were impacted by lower spreads on the investment of cash collateral, offset in part by higher volumes. Fees from asset management in the quarter grew 12% from the prior year to $71.5 million. Other noninterest income was $95.6 million compared with $81.7 million in last year’s first quarter. The increase is primarily attributable to foreign exchange trading income, which was $65.8 million for the quarter compared with $54.6 million in the first quarter of last year. Treasury management fees were 6% lower in the quarter, offset by higher levels of custody-related deposit revenues.

Net interest income stated on a FTE basis was $87.9 million, up 24% from $70.8 million in last year’s first quarter. The increase reflects higher levels of earning assets. Average earning assets increased $8.0 billion, or 31%, with the increase concentrated in short-term money market assets and loans, and funded primarily with non-U.S. office time deposits. The net interest margin equaled 1.06%, down from 1.12% in the prior year quarter.

The $.4 million provision for credit losses in the current quarter compares with a provision of $4.3 million in the first quarter of last year. The prior year provision was due primarily to growth in the commercial portfolio and the migration of certain loans to higher risk credit ratings. Total noninterest expenses of C&IS, which includes the direct expenses of the business unit, indirect expense allocations from Northern Trust Global Investments (NTGI) and Worldwide Operations and Technology (WWOT) for product and operating support, and indirect expense allocations for certain corporate support services, increased 12% and totaled $267.9 million for the first quarter. The current quarter increase was driven by higher expenses for technical and consulting services, increased performance-based compensation, higher staff levels, annual salary increases, and higher allocations for product and operating support.

24

Personal Financial Services

PFS net income for the quarter was $85.2 million, up 9% from $78.1 million reported a year ago. Noninterest income was $239.1 million, up 12% from $213.2 million in last year’s first quarter. Trust, investment and other servicing fees in the quarter increased 14% and totaled a record $214.7 million compared with $188.9 million a year ago. The increase in PFS fees resulted primarily from strong new business 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. Other operating income totaled $24.4 million compared with $24.3 million in the prior year quarter.

Net interest income stated on a FTE basis was $125.2 million in the current quarter compared with $123.7 million in the prior year’s first quarter. The increase reflects an 8% increase in average earning assets, concentrated in the loan portfolio, offset by a reduction in the net interest margin from 3.01% last year to 2.82% in the current quarter. The decline in the net interest margin is primarily a result of rising interest rates on deposits and a greater level of funding from short-term borrowings.

A negative provision for credit losses of $.4 million was recorded in the current quarter compared with a negative provision of $.3 million recorded last year. Total noninterest expenses of PFS, which includes the direct expenses of the business unit, indirect expense allocations from NTGI and WWOT for product and operating support, and indirect expense allocations for certain corporate support services, increased 8% to $225.6 million from $209.7 million in last year’s first quarter. The current quarter increase reflects higher performance-based compensation, annual salary increases, and allocations for product and operating support.

Treasury and Other

Treasury and Other includes income and expense associated with the wholesale funding activities and the investment portfolios of the Corporation and the Bank. Treasury and Other also includes certain corporate-based expenses and nonrecurring items not allocated to the business units and certain executive level compensation. Net interest income for the first quarter was a negative $2.8 million compared with a negative $3.9 million in the year-ago quarter. Noninterest expenses totaled $32.4 million for the quarter, compared with $25.1 million in the year-ago period, and includes a litigation reserve accrual.

25

BALANCE SHEET

Total assets at March 31, 2007 were $59.5 billion and averaged $57.0 billion for the first quarter, compared with last year’s average of $49.7 billion. Loans and leases totaled $21.7 billion at March 31, 2007 and averaged $21.4 billion for the first quarter, compared with $20.0 billion at March 31, 2006 and the $19.6 billion average for the first quarter last year. Securities totaled $12.6 billion at March 31, 2007 and averaged $12.5 billion for the quarter, compared with $11.1 billion at March 31, 2006 and $11.1 billion on average last year. Money market assets totaled $19.5 billion at March 31, 2007. Money market assets averaged $17.0 billion in the first quarter, up 36% from the year-ago quarter. The growth in total assets was funded primarily through an increase in non-U.S. office time deposits, which averaged $27.4 billion in the quarter, up 41% from the year-ago quarter, offset in part by a reduction in short-term borrowings, which averaged $3.9 billion, down 28% from the year-ago quarter.

Common stockholders’ equity increased to $4.0 billion at March 31, 2007 and averaged $3.9 billion for the quarter, up 9% from last year’s first quarter. The increase primarily reflects the retention of earnings offset in part by the impact of adopting new accounting standards and the repurchase of common stock pursuant to the Corporation’s share buyback program.

The December 31, 2006 adoption of a new accounting standard relating to defined benefit pension and other postretirement plans reduced stockholders’ equity by $160.8 million due to the requirement that employers recognize any previously unrecognized actuarial gains/losses and prior service costs, net of tax, in accumulated other comprehensive income. On January 1, 2007, Northern Trust adopted FSP 13-2 related to the accounting for projected changes in leveraged lease cash flows which reduced retained earnings by $72.3 million. In response to the capital impact of adopting these new accounting standards, the Corporation reduced repurchases under the share buyback program in the first quarter of 2007, repurchasing 43,364 shares at a cost of $2.7 million ($61.23 average price per share). An additional 11.9 million shares are authorized for repurchase after March 31, 2007 under the previously announced share buyback program.

Northern Trust’s risk-based capital ratios remained strong at March 31, 2007 and were well above the minimum regulatory requirements of 4% for tier 1 and 8% for total risk-based capital ratios. Northern Trust’s leverage ratio (tier 1 capital to first quarter average assets) at March 31, 2007 also exceeded the minimum regulatory requirement of 3%. Shown below are the March 31, 2007 and March 31, 2006 capital ratios of Northern Trust and of the Bank.

	March 31, 2007				March 31, 2006
Capital Ratios	Northern Trust		The Northern Trust Company		Northern Trust		The Northern Trust Company
Tier 1 Capital	10.2	%	9.3	%	10.2	%	8.4	%
Total Capital	12.4	%	11.7	%	12.7	%	11.4	%
Leverage Ratio	7.0	%	6.0	%	7.0	%	5.6	%

Each of Northern Trust’s other subsidiary banks had March 31, 2007 ratios of 10.4% or higher for tier 1 capital, 11.0% or higher for total risk-based capital, and 8.4% or higher for the leverage ratio.

26

ASSET QUALITY

Nonperforming assets consist of nonaccrual loans and Other Real Estate Owned (OREO). Nonperforming assets at March 31, 2007 totaled $37.0 million compared with $37.1 million at December 31, 2006 and $31.2 million at March 31, 2006. Nonaccrual loans and leases totaled $35.1 million or .16% of total loans and leases at March 31, 2007. At December 31, 2006 and March 31, 2006, nonaccrual loans and leases totaled $35.7 million and $31.1 million, respectively. The $.6 million decrease in nonperforming loans during the quarter is primarily the result of the full repayment received on one nonperforming loan and the partial charge-off of another, partially offset by the reclassification of three loans to nonperforming.

The following table presents the outstanding amounts of nonaccrual loans and OREO. Also shown are loans that have interest or principal payments that are delinquent 90 days or more and are still accruing interest. The balance of loans delinquent 90 days or more and still accruing interest can fluctuate widely based on the timing of cash collections, renegotiations and renewals.

Nonperforming Assets

(In Millions)	March 31, 2007		December 31, 2006		March 31, 2006
Nonaccrual Loans
U.S.
Residential Real Estate	$	14.0	$	8.1	$	7.2
Commercial		12.6		18.8		14.1
Commercial Real Estate		—		—		—
Personal		7.3		7.6		8.6
Non-U.S.		1.2		1.2		1.2
Total Nonaccrual Loans		35.1		35.7		31.1
Other Real Estate Owned		1.9		1.4		.1
Total Nonperforming Assets	$	37.0	$	37.1	$	31.2
90 Day Past Due Loans Still Accruing	$	15.1	$	24.6	$	19.9

Provision and Reserve for Credit Losses

The provision for credit losses is the charge to current earnings that is determined by management, through a disciplined credit review process, to be the amount needed to maintain a reserve that is sufficient to absorb probable credit losses that have been identified with specific borrower relationships (specific loss component) and for probable losses that are believed to be inherent in the loan and lease portfolios, unfunded commitments, and standby letters of credit (inherent loss component).

Note 6 to the consolidated financial statements includes a table that details the changes in the reserve for credit losses during the three month periods ended March 31, 2007 and March 31, 2006 due to charge-offs, recoveries, and the provision for credit losses during the respective periods. The following table shows (i) the specific portion of the reserve, (ii) the allocated portion of the inherent reserve and its components by loan category, and (iii) the unallocated portion of the inherent reserve at March 31, 2007, December 31, 2006 and March 31, 2006.

27

Provision and Reserve for Credit Losses (continued)

Allocation of the Reserve for Credit Losses

	March 31, 2007				December 31, 2006				March 31, 2006
($ in Millions)	Reserve Amount		Percent of Loans to Total Loans		Reserve Amount		Percent of Loans to Total Loans		Reserve Amount		Percent of Loans to Total Loans
Specific Reserve	$	16.4	—	%	$	19.6	—	%	$	19.0	—	%
Allocated Inherent Reserve
Residential Real Estate		12.7	40			13.4	38			11.2	41
Commercial		55.5	22			55.0	21			52.3	19
Commercial Real Estate		23.3	9			21.5	8			18.8	8
Personal		5.7	14			5.9	15			6.1	15
Other		—	4			—	4			—	5
Lease Financing		3.5	5			3.7	6			3.9	6
Non-U.S.		6.2	6			6.6	8			3.7	6
Total Allocated Inherent Reserve	$	106.9	100	%	$	106.1	100	%	$	96.0	100	%
Unallocated Inherent Reserve		25.5	—			25.3	—			24.9	—
Total Reserve	$	148.8	100	%	$	151.0	100	%	$	139.9	100	%
Reserve Assigned to:
Loans and Leases	$	138.3			$	140.4			$	129.3
Unfunded Commitments and Standby Letters of Credit		10.5				10.6				10.6
Total Reserve	$	148.8			$	151.0			$	139.9

Specific Component of Reserve. At March 31, 2007, the specific component of the reserve stood at $16.4 million compared with $19.6 million at December 31, 2006. The $3.2 million decrease in specific reserves from December 31, 2006 is primarily due to the partial charge-off of one nonperforming loan and the full repayment received on another.

Allocated Inherent Component of Reserve. The allocated inherent portion of the reserve totaled $106.9 million at March 31, 2007 compared with $106.1 million at December 31, 2006. This component of the reserve increased by $.8 million primarily due to the growth in the commercial loan portfolio offset in part by principal repayments received on lower rated loans.

Unallocated Inherent Component of Reserve. The unallocated portion of the inherent loss reserve is based on management’s review of other factors affecting the determination of probable inherent losses, primarily in the commercial portfolio, which are not necessarily captured by the application of historical loss ratios. This portion of the reserve analysis involves the exercise of judgment and reflects considerations such as management’s view that the reserve should have a margin that recognizes the imprecision inherent in the process of estimating probable credit losses. The unallocated inherent portion of the reserve was $25.5 million at March 31, 2007.

Other Factors. At March 31, 2007, the total amount of the two highest risk loan groupings, those rated “7” and “8” (based on Northern Trust’s internal rating scale, which closely parallels that of the banking regulators) was $79 million of which $31.8 million was classified as impaired, down from $82 million at December 31, 2006 when $31.9 million was classified as impaired, and up from $73 million at March 31, 2006 when $27.8 million was classified as impaired.

28

Provision and Reserve for Credit Losses (continued)

Overall Reserve. Management’s evaluation of the factors above resulted in a reserve for credit losses of $148.8 million at March 31, 2007. The reserve of $138.3 million assigned to loans and leases, as a percentage of total loans and leases was .64% at March 31, 2007, compared with .62% at December 31, 2006.

Reserves assigned to unfunded loan commitments and standby letters of credit, recorded as a liability on the consolidated balance sheet totaled $10.5 million at March 31, 2007, down slightly from $10.6 million at December 31, 2006.

Provision. There was no provision for credit losses in the first quarter of 2007 compared with a provision of $4.0 million in the prior year quarter.

MARKET RISK MANAGEMENT

As described in the 2006 Financial Annual Report to Shareholders, Northern Trust manages its interest rate risk through measurement techniques which include simulation of earnings, simulation of the economic value of equity, and gap analysis. Also, as part of its risk management activities, it regularly measures the risk of loss associated with foreign currency positions using a value at risk model.

Based on this continuing evaluation process, Northern Trust’s interest rate risk position and the value at risk associated with the foreign exchange trading portfolio have not changed significantly since December 31, 2006.

29

FACTORS AFFECTING FUTURE RESULTS

This report contains statements that may be considered forward-looking, such as the statements relating to Northern Trust’s financial goals, dividend policy, expansion and business development plans, anticipated expense levels and projected profit improvements, business prospects and positioning with respect to market, demographic and pricing trends, strategic initiatives, re-engineering and outsourcing activities, new business results and outlook, changes in securities market prices, credit quality including reserve levels, planned capital expenditures and technology spending, anticipated tax benefits and expenses, and the effects of any extraordinary events and various other matters (including developments in litigation and regulation involving Northern Trust and changes in accounting policies, standards and interpretations) on Northern Trust’s business and results.

Forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “may increase,” “may fluctuate,” “plan,” “goal,” “target,” “strategy,” and similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would,” and “could.” Forward-looking statements are Northern Trust’s current estimates or expectations of future events or future results. Actual results could differ materially from the results indicated by these statements because the realization of those results is subject to many risks and uncertainties including: the health of the U.S. and international economies; changes in financial and equity markets impacting the value of financial assets; changes in foreign currency exchange rates; Northern Trust’s success in managing various risks inherent in its business, including credit risk, interest rate risk and liquidity risk; geopolitical risks and the risks of extraordinary events such as natural disasters, terrorist events, war and the U.S. government’s response to those events; the pace and extent of continued globalization of investment activity and growth in worldwide financial assets; regulatory and monetary policy developments; failure to obtain regulatory approvals when required; changes in tax laws, accounting requirements or interpretations and other legislation in the U.S. or other countries that could affect Northern Trust or its clients; changes in the nature and activities of Northern Trust’s competition; Northern Trust’s success in maintaining existing business and continuing to generate new business in its existing markets; Northern Trust’s success in identifying and penetrating targeted markets, through acquisition, strategic alliance or otherwise; Northern Trust’s success in integrating recent and future acquisitions, strategic alliances, and preferred provider arrangements; Northern Trust’s ability to maintain a product mix that achieves acceptable margins; Northern Trust’s ability to continue to generate investment results that satisfy its clients and continue to develop its array of investment products; Northern Trust’s ability to continue to fund and accomplish innovation, improve risk management practices and controls, and address operating risks, including human errors or omissions, systems defects, systems interruptions, and breakdowns in processes or internal controls; Northern Trust’s success in controlling expenses; risks and uncertainties inherent in the litigation and regulatory process; and the risk of events that could harm Northern Trust’s reputation and so undermine the confidence of clients, counterparties, rating agencies, and stockholders.

30

FACTORS AFFECTING FUTURE RESULTS – (continued)

Some of these and other risks and uncertainties that may affect future results are discussed in more detail in the sections of “Management’s Discussion and Analysis of Financial Condition and Results of Operations” captioned “Risk Management,” “Market Risk Management” and “Operational Risk Management” in the 2006 Financial Annual Report to Shareholders (pages 22 - 31), in the section of the “Notes to Consolidated Financial Statements” in the 2006 Financial Annual Report to Shareholders captioned “Note 24, Contingent Liabilities” (page 62), in the sections of “Item 1 – Business” of the 2006 Annual Report on Form 10-K captioned “Government Polices,” “Competition” and “Regulation and Supervision” (pages 6 - 13) and “Item 1A – Risk Factors” of the 2006 Annual Report on Form 10-K. All forward-looking statements included in this report are based upon information presently available, and Northern Trust assumes no obligation to update any forward-looking statements.

31

The following schedule should be read in conjunction with the Net Interest Income section of Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CONSOLIDATED AVERAGE STATEMENT OF CONDITION WITH ANALYSIS OF NET INTEREST INCOME NORTHERN TRUST CORPORATION

(Interest and rate on a fully taxable equivalent basis)

	First Quarter
	2007							2006
($ in Millions)	Interest		Average Balance			Rate		Interest		Average Balance			Rate
Average Earning Assets
Money Market Assets
Federal Funds Sold and Resell Agreements	$	16.3	$	1,227.0		5.39	%	$	10.7	$	955.7			4.53	%
Time Deposits with Banks		162.5		15,712.0		4.19			97.3		11,481.3			3.44
Other Interest-Bearing		.3		21.1		5.29			.4		38.4			4.35
Total Money Market Assets		179.1		16,960.1		4.28			108.4		12,475.4			3.52
Securities
U.S. Government		1.3		99.3		5.46			1.7		146.4			4.62
Obligations of States and Political Subdivisions		14.7		885.8		6.66			15.3		906.0			6.76
Government Sponsored Agency		138.5		10,300.2		5.45			98.8		8,780.1			4.56
Other		15.5		1,229.1		5.11			14.6		1,236.6			4.75
Total Securities		170.0		12,514.4		5.50			130.4		11,069.1			4.77
Loans and Leases		302.8		21,430.9		5.73			253.6		19,642.4			5.24
Total Earning Assets	$	651.9		50,905.4		5.19	%	$	492.4		43,186.9			4.62	%
Reserve for Credit Losses Assigned to Loans and Leases		—		(140.1	)	—			—		(125.1	)		—
Cash and Due from Banks		—		2,300.7		—			—		3,309.7			—
Other Assets		—		3,983.7		—			—		3,287.1			—
Total Assets		—	$	57,049.7		—			—	$	49,658.6			—
Average Source of Funds
Deposits
Savings and Money Market	$	56.4	$	6,830.9		3.35	%	$	43.4	$	7,016.1			2.51	%
Savings Certificates		23.4		1,996.8		4.74			14.7		1,614.7			3.70
Other Time		5.5		471.1		4.74			3.5		384.1			3.73
Non - U.S. Offices Time		267.1		27,424.3		3.95			150.1		19,421.1			3.13
Total Interest-Bearing Deposits		352.4		36,723.1		3.89			211.7		28,436.0			3.02
Short-Term Borrowings		44.1		3,939.0		4.54			44.3		5,434.8			3.31
Senior Notes		5.8		445.0		5.21			2.9		274.7			4.16
Long-Term Debt		35.3		2,522.4		5.61			39.3		2,775.1			5.66
Floating Rate Capital Debt		4.0		276.5		5.81			3.6		276.4			5.14
Total Interest-Related Funds		441.6		43,906.0		4.07			301.8		37,197.0			3.29
Interest Rate Spread		—		—		1.12	%		—		—			1.33	%
Noninterest-Bearing Deposits		—		6,881.2		—			—		6,332.0			—
Other Liabilities		—		2,322.0		—			—		2,502.4			—
Stockholders’ Equity		—		3,940.5		—			—		3,627.2			—
Total Liabilities and Stockholders’ Equity		—	$	57,049.7		—			—	$	49,658.6			—
Net Interest Income/Margin (FTE Adjusted)	$	210.3		—		1.68	%	$	190.6		—			1.79	%
Net Interest Income/Margin (Unadjusted)	$	194.7		—		1.55	%	$	175.3		—			1.65	%
ANALYSIS OF NET INTEREST INCOME CHANGES DUE TO VOLUME AND RATE
								First Quarter 2007/2006
								Change Due To
(In Millions)								Average Balance		Rate			Total
Earning Assets (FTE)								$	93.9	$	65.6		$	159.5
Interest-Related Funds									67.8		72.0			139.8
Net Interest Income (FTE)								$	26.1	$	(6.4	)	$	19.7

32

Item 3. Quantitative and Qualitative Disclosures about Market Risk

The information called for by this item is incorporated herein by reference to “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Market Risk Management” on page 29 of this document.

Item 4. Controls and Procedures

The Corporation’s management, with the participation of the Corporation’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of Northern Trust’s “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of the end of the period covered by this report. Based on such evaluation, such officers have concluded that, as of the end of the period covered by this report, the Corporation’s disclosure controls and procedures are effective in bringing to their attention on a timely basis material information relating to the Corporation (including its consolidated subsidiaries) required to be included in the Corporation’s periodic filings under the Exchange Act.

There have been no changes in the Corporation’s internal control over financial reporting during the last fiscal quarter that have materially affected, or that are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

33

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The information called for by this item is incorporated herein by reference to Note 13 titled “Contingent Liabilities” beginning on page 15 of this Form 10-Q.

Item 1A. Risk Factors

There are no material changes to the risk factors set forth in Part I, Item 1A in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2006.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) The following table shows certain information relating to the Corporation’s purchases of common stock for the three months ended March 31, 2007 pursuant to the Corporation’s share buyback program:

Period	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of a Publicly Announced Plan (2)	Maximum Number of Shares That May Yet Be Purchased Under the Plan
January 1-31, 2007	20,019	$	60.57	20,019
February 1-28, 2007	3,843		61.95	3,843
March 1-31, 2007	19,502		61.76	19,502
Total (First Quarter)	43,364	$	61.23	43,364	11,873,446

(1) Includes shares purchased from employees in connection with equity plan transactions such as the surrender of shares to pay an option exercise price or tax withholding.

(2) The Corporation’s current stock buyback program, announced October 17, 2006, authorizes the purchase of up to 12.0 million shares of the Corporation’s common stock. The Corporation’s current stock buyback program has no fixed expiration date.

34

Item 4. Submission of Matters to a Vote of Security Holders

The annual meeting of the stockholders of Northern Trust Corporation was held on April 17, 2007 for the purposes of (i) electing 14 Directors to hold office until the next annual meeting of stockholders, (ii) approving the amended and restated Northern Trust Corporation 2002 Stock Plan (the “Amended and Restated Stock Plan”), and (iii) ratifying the appointment of KPMG LLP as the Corporation’s independent registered public accounting firm for the 2007 fiscal year. Proxies for the meeting were solicited pursuant to Section 14(a) of the Securities Exchange Act of 1934, and there was no solicitation in opposition to management’s nominees.

All of management’s nominees for Director as named in the proxy statement were elected by the votes set forth in the table below. Each nominee received no fewer than 183,944,928 votes, which amounted to 91.82% of the shares voted and more than a majority of the shares present and voting as required for election. There were no broker non-votes with respect to any nominees.

NOMINEES	FOR	WITHHELD
Linda Walker Bynoe	197,328,177	3,004,321
Nicholas D. Chabraja	197,567,541	2,764,957
Susan Crown	183,944,928	16,387,970
Dipak C. Jain	197,823,580	2,508,918
Arthur L. Kelly	193,543,844	6,788,654
Robert C. McCormack	191,195,011	9,137,487
Edward J. Mooney	188,575,525	11,756,973
William A. Osborn	194,485,346	5,849,752
John W. Rowe	197,352,055	2,980,443
Harold B. Smith	195,417,953	4,914,545
William D. Smithburg	188,450,911	11,881,587
Enrique J. Sosa	198,266,881	2,065,617
Charles A. Tribbett III	191,542,053	8,790,445
Frederick H. Waddell	195,668,595	4,663,903

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Item 4. Submission of Matters to a Vote of Security Holders (continued)

Stockholders approved the Amended and Restated Stock Plan. 146,176,535 votes were cast "FOR" approval of the Amended and Restated Stock Plan, 30,254,554 votes were cast "AGAINST" approval of the Amended and Restated Stock Plan, and 1,599,096 shares abstained from voting on this matter. There were 22,302,313 broker non-votes.

The appointment of KPMG LLP as the Corporation’s independent registered public accounting firm for the 2007 fiscal year (the “Appointment”) was ratified as follows: 196,136,342 votes were cast “FOR” ratification of the Appointment, 3,007,124 votes were cast “AGAINST” ratification of the Appointment, and 1,189,032 shares abstained from voting on this matter. There were no broker non-votes on this matter.

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Item 6. Exhibits

(a) Exhibits

(10)	Material Contracts
	(i)	Form of 2007 Stock Unit Award Terms and Conditions.
	(ii)	Form of 2007 Performance Stock Unit Award Terms and Conditions.
	(iii)	Form of 2007 Executive Stock Option Terms and Conditions.
	(iv)	Form of 2007 Director Stock Agreement.
	(v)	Amended and Restated Northern Trust Corporation 2002 Stock Plan.
(31)	Rule 13a-14(a)/15d-14(a) Certifications
	(i)	Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	(ii)	Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(32)	Section 1350 Certifications
	(i)	Certifications of CEO and CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(99)	Additional Exhibits
	(i)	Edited version of the remarks delivered by William A. Osborn, Chairman and Chief Executive Officer, and Frederick H. Waddell, President and Chief Operating Officer, at the Annual Meeting of Stockholders of Northern Trust Corporation held on April 17, 2007.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	NORTHERN TRUST CORPORATION (Registrant)
Date: April 30, 2007	By:	/s/ Steven L. Fradkin
		Steven L. Fradkin
		Executive Vice President and Chief Financial Officer
Date: April 30, 2007	By:	/s/ Aileen B. Blake
		Aileen B. Blake
		Executive Vice President and Controller
		(Chief Accounting Officer)

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EXHIBIT INDEX

The following exhibits have been filed with the Securities and Exchange Commission with Northern Trust Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2007. You may obtain copies of these exhibits from the SEC’s Internet site at http://www.sec.gov. Stockholders may also obtain copies of such exhibits by writing Rose A. Ellis, Secretary, Northern Trust Corporation, 50 South LaSalle Street, Chicago, Illinois 60603.

Exhibit Number	Description
(10)	Material Contracts
	(i)	Form of 2007 Stock Unit Award Terms and Conditions.
	(ii)	Form of 2007 Performance Stock Unit Award Terms and Conditions.
	(iii)	Form of 2007 Executive Stock Option Terms and Conditions.
	(iv)	Form of 2007 Director Stock Agreement.
	(v)	Amended and Restated Northern Trust Corporation 2002 Stock Plan.
(31)	Rule 13a-14(a)/15d-14(a) Certifications
	(i)	Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	(ii)	Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(32)	Section 1350 Certifications
	(i)	Certifications of CEO and CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(99)	Additional Exhibits
	(i)	Edited version of the remarks delivered by William A. Osborn, Chairman and Chief Executive Officer, and Frederick H. Waddell, President and Chief Operating Officer, at the Annual Meeting of Stockholders of Northern Trust Corporation held on April 17, 2007.

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EX-10.(I)

Exhibit 10(i)

TERMS AND CONDITIONS

2007 STOCK UNIT AWARD

NORTHERN TRUST CORPORATION 2002 STOCK PLAN

Your stock unit grant is subject to the provisions of the Northern Trust Corporation 2002 Stock Plan (the “Plan”) and the stock unit award notice (the “Award Notice”). The Award Notice and these Terms and Condition constitute the “Stock Unit Agreement” as defined in the Plan. If there is any conflict between the information in the Stock Unit Agreement and the Plan, the Plan will govern.

1. Grant. The Corporation hereby grants to the Participant an award of Stock Units, as set forth in the Award Notice, subject to the terms and conditions of the Plan and the Stock Unit Agreement. A Stock Unit is the right, subject to the terms and conditions of the Plan and the Stock Unit Agreement, to receive a distribution of a share of Common Stock pursuant to Paragraph 6 of these Terms and Conditions.

2. Stock Unit Account. The Corporation shall maintain an account (“Stock Unit Account”) on its books in the name of the Participant which shall reflect the number of Stock Units awarded to the Participant that the Participant is eligible to receive in distribution pursuant to Paragraph 6 of these Terms and Conditions.

3. Dividend Equivalents. Upon the payment of any dividend on Common Stock occurring during the period preceding the distribution of the Participant’s Stock Unit award pursuant to Paragraph 6 of these Terms and Conditions, the Corporation shall promptly pay to the Participant an amount in cash equal in value to the dividends that the Participant would have received had the Participant been the actual owner of the number of shares of Common Stock represented by the Stock Units in the Participant’s Stock Unit Account on that date (“Dividend Equivalents”).

4. Forfeiture. The Stock Units granted to the Participant pursuant to the Stock Unit Agreement shall be forfeited and revert to the Corporation if prior to the date on which the Stock Units vest pursuant to Paragraph 5 of these Terms and Conditions (a) the Participant violates any provision of Paragraph 7 of these Terms and Conditions, or (b) except as described in Paragraphs 5 and 8 of these Terms and Conditions, the Participant’s employment with the Corporation or any of its Subsidiaries terminates.

5. Vesting. The Participant shall become vested in the Stock Units in accordance with the vesting schedule set forth in the Award Notice, subject to (a) prorated vesting in accordance with Paragraph 8 of these Terms and Conditions upon the Participant’s death, Retirement or Disability (each as defined below) or upon termination of employment under certain circumstances described in Paragraph 8 of these Terms and Conditions where the Participant is entitled to severance benefits, (b) prorated vesting in accordance with Paragraph 8 of these Terms and Conditions in the event that prior to vesting the Participant’s employment with the Corporation or any of its Subsidiaries has terminated and (i) the Participant is a Management Committee member on the date of grant, (ii) the Participant is 55 years or older on the date of termination of employment and (iii) the Participant has not violated any provision of Paragraph 7 of these Terms and Conditions during the period ending on the

latest vesting date set forth in the Award Notice (“Vesting Period”), or (c) full vesting in the event of a Change in Control (as defined in the Plan) of the Corporation. If the Participant’s employment with the Corporation or any of its Subsidiaries terminates for any reason other than as set forth above in this Paragraph 5, the Stock Units in the Participant’s Stock Unit Account that have not yet vested shall be forfeited and revert to the Corporation on such termination date, and the Corporation shall have no further obligation after such date to pay Dividend Equivalents pursuant to Paragraph 3 of these Terms and Conditions. The Corporation shall have no further obligation to the Participant under these Terms and Conditions following the Participant’s forfeiture of Stock Units.

For purposes of these Terms and Conditions, “Retirement” means retirement occurring by reason of the Participant having qualified for a Normal, Early, or Postponed Retirement under The Northern Trust Company Pension Plan.

For purposes of these Terms and Conditions, “Disability” means a disability that continues for a period of 12 months as defined by Northern Trust’s Managed Disability Program.

6. Distribution. Except as provided below in this Paragraph 6 or in Paragraphs 9 or 10 of these Terms and Conditions, the Participant shall become entitled to the distribution of the Participant’s Stock Units as soon as practicable after the vesting of the Stock Units pursuant to Paragraph 5 of these Terms and Conditions, except that any Participant who is subject to Section 16 of the Securities Exchange Act of 1934 at the time of vesting (a “Section 16 Participant”) shall become entitled to the distribution of the Stock Units on the Applicable Date (as defined below) in the year in which the Stock Units vest pursuant to Paragraph 5 of these Terms and Conditions.

Except as provided below in Paragraphs 9 or 10 of these Terms and Conditions, in the event of the Participant’s death prior to the end of the Vesting Period, or thereafter but prior to the full distribution to the Participant pursuant to these Terms and Conditions, the Participant’s beneficiary shall become entitled to the distribution of any vested Stock Units as soon as practicable after the Participant’s death, or such later date but prior to such full distribution thereof, with such vesting to be determined in accordance with Paragraph 8 of these Terms and Conditions, and such distribution shall be made to such beneficiary and in such proportions as the Participant may designate in writing, and in the absence of a designation, to the following persons in the order indicated below:

• The Participant’s spouse; if none, then,

• The Participant’s children (in equal amounts); if none, then,

• The Participant’s parents (in equal amounts); if none, then,

• The Participant’s brothers and sisters (in equal amounts); if none, then,

• The Participant’s estate.

Except as provided below in Paragraphs 9 or 10 of these Terms and Conditions, in the event of the Participant’s Retirement or Disability prior to the end of the Vesting Period, the Participant shall become entitled to the distribution of any vested Stock Units as soon as practicable after the Participant’s Retirement or Disability, with such vesting to be determined in accordance with Paragraph 8 under these Terms and Conditions.

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Stock Units shall be distributed only in shares of Common Stock so that, pursuant to Paragraph 1 of these Terms and Conditions and this Paragraph 6, a Participant shall be entitled to receive one share of Common Stock for each Stock Unit in the Participant’s Stock Unit Account. No distribution shall be made prior to the first date that shares of Common Stock may be distributed to the Participant without penalty or forfeiture under federal or state laws or regulations governing short-swing trading of securities. In determining whether a distribution would result in such a penalty or forfeiture, the Corporation may rely upon information reasonably available to it or upon representations of the Participant’s legal or personal representative.

For purposes of these Terms and Conditions, “Applicable Date” with respect to a given year means the first trading day of the fourth quarter of that year, after the vesting of the Stock Units, on which the Corporation’s trading blackout is not in effect for the Section 16 Participant; or such other date in that year as the Committee or the Executive Vice President of Human Resources may determine.

7. Restricted Activity. Despite anything to the contrary in Paragraph 5, 6 or 8 of these Terms and Conditions, the Participant’s Stock Units (whether vested or unvested) shall be forfeited and the Corporation shall have no obligation to distribute the Stock Units to the Participant (or the Participant’s beneficiary) pursuant to Paragraph 6, or to pay any Dividend Equivalents pursuant to Paragraph 3, if the Participant:

(a) at any time after the date of these Terms and Conditions, has divulged, directly or indirectly, or used, for the Participant’s own or another’s benefit, any Confidential Information; or

(b) at any time after the date of these Terms and Conditions and through a period of twelve (12) months after the Participant ceases to be employed by the Corporation or any of its Subsidiaries for any reason, has Solicited, or assisted in the Solicitation of, any Client or Prospective Client; or solicited, encouraged, advised, induced or caused any employee of the Corporation or any of its Subsidiaries to terminate his or her employment with the Corporation or any of its Subsidiaries, or provided any assistance, encouragement, information, or suggestion to any person or entity regarding the solicitation or hiring of any employee of the Corporation or any of its Subsidiaries; provided, however, this clause (b) shall not prohibit the Participant’s Solicitation of any Client or Prospective Client with whom he or she had a business relationship prior to the start of his or her employment with the Corporation or any of its Subsidiaries, provided no Confidential Information, directly or indirectly, is used in such Solicitation.

(c) If the Participant shall have so engaged in any such activity described in clauses (a) or (b) above without the written consent of the Corporation, the Participant’s Stock Units (whether vested or unvested) shall be forfeited to the Corporation by notice in writing to the Participant within a reasonable period of time after the

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Corporation acquires knowledge of the Participant’s violation of this Paragraph 7. Any failure by the Participant to comply with this Paragraph 7 shall entitle the Corporation, as determined by the Committee in its sole discretion, to (i) cancel and terminate all of the Participant’s unexercised, unexpired, unpaid or deferred Stock Units (whether vested or unvested) under the Plan, and (ii) rescind any exercise, payment or delivery with respect to any Stock Units occurring within twelve (12) months prior to, or at any time following, the date of the Participant’s termination of employment for any reason (including but not limited to termination of employment due to Retirement or Disability). Upon any such rescission, (1) the Participant shall immediately pay to the Corporation the amount of any gain realized or payment received, and (2) the Participant shall immediately forfeit to the Corporation any shares of the Corporation’s Common Stock received, in each case as a result of the rescinded exercise, payment or delivery with respect to any Stock Units, in such manner and on such terms and conditions as the Committee shall require, and the Corporation shall be entitled, as permitted by applicable law, to deduct from any amounts the Corporation owes the Participant from time to time the amount of any such gain realized or payment received. “Gain realized” shall be determined by the Committee in its sole discretion.

8. Proration.

(a) The Participant shall cease to participate in the Plan under these Terms and Conditions as of the date of the Participant’s death, Disability or Retirement. If the Participant’s death, Retirement or Disability occurs prior to the end of the Vesting Period, or if prior to the end of the Vesting Period, the Participant’s employment is terminated under circumstances that entitle the Participant to severance benefits under the Northern Trust Corporation Severance Plan (the “Severance Plan”) and the Participant has executed and not revoked a settlement agreement, waiver and release under the Severance Plan (a “Release”), then, in each such case, the Participant shall have credited, and be deemed vested in, on such date of death, Retirement or Disability or date of termination of employment, a pro-rated number of Stock Units based upon the total number of Stock Units granted, the manner of vesting, the number of months elapsed since the date of grant, and the number of months remaining in the Vesting Period, as determined by the Committee or the Executive Vice President of Human Resources.

(b) If, prior to the end of the Vesting Period, a Participant’s employment with the Corporation or any of its Subsidiaries has terminated and (i) the Participant is a Management Committee member on the date of grant, (ii) the Participant is 55 years or older on the date of such termination, and (iii) the Participant has not violated any provision of Paragraph 7 of these Terms and Conditions during the Vesting Period, then the Participant shall have credited, and be deemed vested in, on the vesting date of the award, a pro-rated number of Stock Units based upon the total number of Stock Units granted, the manner of vesting, the number of months elapsed since the date of grant, and the number of months remaining in the Vesting Period, as determined by the Committee or the Executive Vice President of Human Resources.

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9. Mandatory Deferral. Subject to applicable law, if the Participant is, or in the sole judgment of the Committee is reasonably expected to be, a “covered employee” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations promulgated thereunder (“Section 162(m)”) in the calendar year in which the Participant would otherwise become entitled to the distribution of the Participant’s Stock Units, the Participant shall not become entitled to the distribution of the Participant’s Stock Units until the Applicable Date in the first calendar year that the Participant is not a “covered employee” under Section 162(m), as determined by the Committee. Notwithstanding the foregoing, the Committee, in its sole discretion, shall have the right to distribute to the Participant all or any portion of the Stock Units or any deferred Stock Units that it determines is not subject to the deduction limitation of Section 162(m) in a given calendar year, after taking into account all other compensation payable to the Participant for that year that it determines is subject to the deduction limitation of Section 162(m). All determinations relating to “covered employee” status and the application of the deduction limitation of Section 162(m) shall be made by the Committee, in its sole discretion, as promptly as reasonably practical. The provisions of this Paragraph 9 shall not apply following a Change in Control of the Corporation, and the Participant shall be entitled to the distribution of the Participant’s Stock Units without regard to the Participant’s status as a “covered employee” within the meaning of Section 162(m).

10. Voluntary Deferral.

(a) Subject to applicable law, in addition and subject to any mandatory deferral under Paragraph 9 of this Agreement, the Participant may elect to defer all or any portion of the Stock Units so that the Participant becomes entitled to the distribution of any vested Stock Units on the anniversary of the vesting date (or the Applicable Date in the case of any Section 16 Participant), in any year that is (i) no earlier than the end of the third calendar year after the calendar year in which the Stock Units vest pursuant to Paragraph 5 of these Terms and Conditions, and (ii) no later than the fifth calendar year beginning after the Participant’s Retirement or other termination of employment. Notwithstanding the previous sentence, in no event shall distribution of the Stock Units begin earlier than six months following termination of employment, unless due to the Participant’s death, if the Participant was a “Specified Employee” (as defined in Section 409A(a)(2)(B)(i) of the Code) of the Corporation at termination of employment, as determined in accordance with procedures adopted by the Corporation pursuant to Section 409A of the Code and related regulations.

(b) The Participant shall make any election to defer receipt of the payment of all or any portion of the Stock Units by filing a deferral election form with the Corporation within thirty (30) days after the date of the grant and at least thirteen (13) months prior to the end of the Vesting Period set forth in the Award Notice.

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(c) Distribution of any deferred Stock Units pursuant to this Paragraph 10 shall be made at one time or in up to five (5) annual installments, as the Participant shall have elected in the deferral election form described in clause (b) above. If the Participant has elected an installment distribution, the initial installment shall be distributed as soon as practical after the anniversary of the vesting date (or the Applicable Date in the case of any Section 16 Participant) in the first year to which distribution has been deferred, and the remaining installments shall be distributed on each anniversary date of the initial distribution.

11. Delivery of Shares. The Corporation shall not be required to issue or deliver any shares of Common Stock pending compliance with applicable federal and state securities laws (including any registration required) and compliance with applicable stock exchange rules and practices. The Corporation shall use its reasonable efforts to cause compliance with those laws, rules and practices.

12. Adjustment. The Stock Units provided herein are subject to adjustment in accordance with the provisions of Section 11 of the Plan.

13. No Right to Employment. Nothing in the Plan or the Stock Unit Agreement shall be construed as creating any right in the Participant to continued employment or as altering or amending the existing terms and conditions of employment of the Participant except as otherwise specifically provided in the Stock Unit Agreement.

14. Nontransferability. No interest hereunder of the Participant is transferable except as provided in the Stock Unit Agreement.

15. Withholding. The Corporation shall have the right to deduct from any distribution made hereunder in cash any sum required to be withheld by the Corporation for federal, state or local taxes. In the case of any distribution made hereunder in shares of Common Stock, the Corporation requires as a condition of distribution that the Participant or the Participant’s beneficiary pay the Corporation the amount which the Corporation determines to be required to be withheld for federal, state or local taxes. The tax withholding obligation with respect to shares of Common Stock shall be satisfied by the Corporation’s withholding a portion of such shares otherwise distributable to the Participant. Any shares withheld shall be valued at their fair market value as of the date of distribution.

16. Administration. The Plan is administered by the Committee. The rights of the Participant hereunder are expressly subject to the terms and conditions of the Plan (including continued shareholder approval of the Plan), together with such guidelines as have been or may be adopted from time to time by the Committee. The Participant hereby acknowledges receipt of a copy of the Plan.

17. No Rights as Shareholder. Except as provided herein, the Participant will have no rights as a shareholder with respect to the Stock Units.

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18. Interpretation. Any interpretation by the Committee of the terms and conditions of the Plan, the Stock Unit Agreement or any guidelines shall be final. The Stock Unit Agreement shall be construed under the laws of the State of Illinois without regard to the conflict of law provisions of any state.

19. Sole Agreement. The Stock Unit Agreement, together with the Plan, is the entire Agreement between the parties hereto, all prior oral and written representations being merged herein. No amendment or modification of the terms of the Stock Unit Agreement shall be binding on either party unless reduced to writing and signed by the party to be bound. The Stock Unit Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors.

20. Definitions. Capitalized terms not defined in the Stock Unit Agreement shall have the meanings assigned to them in the Plan. For purposes of the Stock Unit Agreement:

(a) “Client” means any person or entity with which the Corporation, or any of its Subsidiaries, did business and with which the Participant had contact, or about which the Participant had access to Confidential Information, during the last twelve (12) months of his or her employment.

(b) “Competitive Service or Product” means any service or product: (i) that is substantially similar to or competitive with any service or product that the Participant created or provided, or of which the Participant assisted in the creation or provision, during his or her employment by the Corporation or any of its Subsidiaries; or (ii) about which the Participant had access to Confidential Information during his or her employment by the Corporation or any of its Subsidiaries.

(c) “Confidential Information” means any trade secrets or other information, including, but not limited to, any client information (for example, client lists, information about client accounts, borrowings, and current or proposed transactions), any internal analysis of clients, marketing strategies, financial reports or projections, business or other plans, data, procedures, methods, computer data or system program or design, devices, lists, tools, or compilation, which relate to the present or planned business of the Corporation or any of its Subsidiaries and which has not been made generally known to the public by authorized representatives of the Corporation.

(d) “Prospective Client” means any person or entity to which the Corporation, or any of its Subsidiaries, provided, or from which the Corporation, or any of its Subsidiaries received, a proposal, bid, or written inquiry (general advertising or promotional materials and mass mailings excepted) and with which the Participant had contact, or about which the Participant had access to Confidential Information, during the last twelve (12) months of his or her employment.

(e) “Solicit” and “Solicitation” (with respect to Clients or Prospective Clients) mean directly or indirectly, and without the Corporation’s written authorization, to

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invite, encourage, request, or induce (or to assist another to invite, encourage, request or induce) any Client or Prospective Client of the Corporation, or any of its Subsidiaries, to: (i) surrender, redeem or terminate a product, service or relationship with the Corporation, or any of its Subsidiaries; (ii) obtain any Competitive Service or Product from the Participant or any third party; or (iii) transfer a product, service or relationship from the Corporation, or any of its Subsidiaries, to the Participant or any third party.

Dated: February 20, 2007

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EX-10.(II)

Exhibit 10(ii)

TERMS AND CONDITIONS

2007 PERFORMANCE STOCK UNIT AWARD

UNDER THE NORTHERN TRUST CORPORATION 2002 STOCK PLAN

Your performance stock unit grant is subject to the provisions of the Northern Trust Corporation 2002 Stock Plan (the “Plan”) and the performance stock unit award notice (the “Award Notice”). The Award Notice and these Terms and Condition constitute the “Stock Unit Agreement” as defined in the Plan. If there is any conflict between the information in the Stock Unit Agreement and the Plan, the Plan will govern.

1. Grant. The Corporation hereby grants to the Participant an award of Stock Units, as set forth in the Award Notice, subject to the terms and conditions of the Plan and the Stock Unit Agreement, and subject further to increase or decrease as set forth in the Award Notice. This award of Stock Units is intended to qualify as “performance based compensation” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). A Stock Unit is the right, subject to the terms and conditions of the Plan and the Stock Unit Agreement, to receive a distribution of a share of Common Stock pursuant to Paragraph 6 of these Terms and Conditions.

2. Stock Unit Account. The Corporation shall maintain an account (“Stock Unit Account”) on its books in the name of the Participant which shall reflect the number of Stock Units awarded to the Participant that the Participant is eligible to receive in distribution pursuant to Paragraph 6 of these Terms and Conditions.

3. Dividend Equivalents. Upon the payment of any dividend on Common Stock occurring during the period preceding the distribution of the Participant’s Stock Unit award pursuant to Paragraph 6 of these Terms and Conditions, the Corporation shall promptly pay to the Participant an amount in cash equal in value to the dividends that the Participant would have received had the Participant been the actual owner of the number of shares of Common Stock represented by the Stock Units in the Participant’s Stock Unit Account on that date (“Dividend Equivalents”).

4. Forfeiture. The Stock Units granted to the Participant pursuant to the Performance Stock Unit Agreement shall be forfeited and revert to the Corporation if prior to the date on which the Stock Units vest pursuant to Paragraphs 5 and 8(c) of these Terms and Conditions (a) the Participant violates any provision of Paragraph 7 of these Terms and Conditions, or (b) except as described in Paragraphs 5 and 8 of these Terms and Conditions, the Participant’s employment with the Corporation or any of its Subsidiaries terminates.

5. Vesting. The Participant shall become vested in the Stock Units as and to the extent set forth in Exhibit A to these Terms and Conditions, subject to (a) prorated vesting in accordance with Paragraph 8 of these Terms and Conditions upon the Participant’s death, Retirement or Disability (each as defined below) or upon termination of employment under certain circumstances described in Paragraph 8 of these Terms and Conditions where the Participant is entitled to severance benefits, (b) prorated vesting in accordance

with Paragraph 8 of these Terms and Conditions in the event that prior to vesting the Participant’s employment with the Corporation or any of its Subsidiaries has terminated and (i) the Participant is a Management Committee member on the date of grant, (ii) the Participant is 55 years or older on the date of termination of employment and (iii) the Participant has not violated any provision of Paragraph 7 of these Terms and Conditions during the performance period set forth in Exhibit A to these Terms and Conditions (“Vesting Period”), or (c) full vesting in the event of a Change in Control (as defined in the Plan) of the Corporation. If the Participant’s employment with the Corporation or any of its Subsidiaries terminates for any reason other than as set forth above in this Paragraph 5, the Stock Units in the Participant’s Stock Unit Account that have not yet vested shall be forfeited and revert to the Corporation on such termination date, and the Corporation shall have no further obligation after such date to pay Dividend Equivalents pursuant to Paragraph 3 of these Terms and Conditions. The Corporation shall have no further obligation to the Participant under these Terms and Conditions following the Participant’s forfeiture of Stock Units.

For purposes of these Terms and Conditions, “Retirement” means retirement occurring by reason of the Participant having qualified for a Normal, Early, or Postponed Retirement under The Northern Trust Company Pension Plan.

For purposes of these Terms and Conditions, “Disability” means a disability that continues for a period of 12 months as defined by Northern Trust’s Managed Disability Program.

6. Distribution. Except as provided below in this Paragraph 6 or in Paragraph 9 of these Terms and Conditions, the Participant shall become entitled to the distribution of the Participant’s Stock Units as soon as practicable after the vesting of the Stock Units pursuant to Paragraph 5 of these Terms and Conditions, except that any Participant who is subject to Section 16 of the Securities Exchange Act of 1934 at the time of vesting (a “Section 16 Participant”) shall become entitled to the distribution of the Stock Units on the Applicable Date (as defined below) in the year in which the Stock Units vest pursuant to Paragraph 5 of these Terms and Conditions.

Except as provided below in Paragraphs 9 or 10 of these Terms and Conditions, in the event of the Participant’s death during the performance period set forth in Exhibit A to these Terms and Conditions, or thereafter but prior to full distribution to the Participant pursuant to theses Terms and Conditions, the Participant’s beneficiary shall become entitled to the distribution of any vested Stock Units as soon as practicable after the end of such performance period, or such later date but prior to such full distribution thereof, with the vesting to be determined in accordance with Paragraph 8 of these Terms and Conditions, and such distribution shall be made to such beneficiary and in such proportions as the Participant may designate in writing, and in the absence of a designation, to the following persons in the order indicated below:

• The Participant’s spouse; if none, then,

• The Participant’s children (in equal amounts); if none, then,

• The Participant’s parents (in equal amounts); if none, then,

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• The Participant’s brothers and sisters (in equal amounts); if none, then,

• The Participant’s estate.

Except as provided below in Paragraphs 9 or 10 of these Terms and Conditions, in the event of the Participant’s Retirement or Disability during the performance period set forth in Exhibit A to these Terms and Conditions, the Participant shall become entitled to the distribution of any vested Stock Units as soon as practicable after the end of such performance period, with such vesting to be determined in accordance with Paragraph 8 of these Terms and Conditions.

Stock Units shall be distributed only in shares of Common Stock so that, pursuant to Paragraph 1 of these Terms and Conditions and this Paragraph 6, a Participant shall be entitled to receive one share of Common Stock for each Stock Unit in the Participant’s Stock Unit Account. No distribution shall be made prior to the first date that shares of Common Stock may be distributed to the Participant without penalty or forfeiture under federal or state laws or regulations governing short-swing trading of securities. In determining whether a distribution would result in such a penalty or forfeiture, the Corporation may rely upon information reasonably available to it or upon representations of the Participant’s legal or personal representative.

For purposes of these Terms and Conditions, “Applicable Date” with respect to a given year means the first trading day of that year, after the vesting of the Stock Units, on which the Corporation’s trading blackout is not in effect for the Section 16 Participant, or such other date in that year as the Committee or the Executive Vice President of Human Resources may determine.

7. Restricted Activity. Despite anything to the contrary in Paragraph 5, 6 or 8 of these Terms and Conditions, the Participant’s Stock Units (whether vested or unvested) shall be forfeited and the Corporation shall have no obligation to distribute the Stock Units to the Participant (or the Participant’s beneficiary) pursuant to Paragraph 6, or to pay any Dividend Equivalents pursuant to Paragraph 3, if the Participant:

(a) at any time after the date of these Terms and Conditions, has divulged, directly or indirectly, or used for the Participant’s own or another’s benefit, any Confidential Information; or

(b) at any time after the date of these Terms and Conditions and through a period of twelve (12) months after the Participant ceases to be employed by the Corporation or any of its Subsidiaries for any reason, has Solicited, or assisted in the Solicitation of, any Client or Prospective Client; or solicited, encouraged, advised, induced or caused any employee of the Corporation or any of its Subsidiaries to terminate his or her employment with the Corporation or any of its Subsidiaries, or provided any assistance, encouragement, information, or suggestion to any person or entity regarding the solicitation or hiring of any employee of the Corporation or any of its Subsidiaries; provided, however, that this clause (b) shall not prohibit the Participant’s Solicitation of any Client or Prospective Client with whom he or she had a business relationship prior to the start of his or her employment with the Corporation, provided that no Confidential Information, directly or indirectly, is used in such Solicitation.

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(c) If the Participant shall have so engaged in any such activity described in clause (a) through (c) above without the written consent of the Corporation, the Participant’s Stock Units (whether vested or unvested) shall be forfeited to the Corporation by notice in writing to the Participant within a reasonable period of time after the Corporation acquires knowledge of the Participant’s violation of this Paragraph 7. Any failure by the Participant to comply with this Paragraph 7 shall entitle the Corporation, as determined by the Committee in its sole discretion, to (i) cancel and terminate all of the Participant’s unexercised, unexpired, unpaid or deferred Stock Units (whether vested or unvested) under the Plan, and (ii) rescind any exercise, payment or delivery with respect to any Stock Units occurring within twelve (12) months prior to, or at any time following, the date of the Participant’s termination of employment for any reason (including but not limited to termination of employment due to Retirement or Disability). Upon any such rescission, (1) the Participant shall immediately pay to the Corporation the amount of any gain realized or payment received, and (2) the Participant shall immediately forfeit to the Corporation any shares of the Corporation’s Common Stock received, in each case as a result of the rescinded exercise, payment or delivery with respect to any Stock Units, in such manner and on such terms and conditions as the Committee shall require, and the Corporation shall be entitled, as permitted by applicable law, to deduct from any amounts the Corporation owes the Participant from time to time the amount of any such gain realized or payment received. “Gain realized” shall be determined by the Committee in its sole discretion.

8. Proration.

(a) The Participant shall cease to participate in the Plan under these Terms and Conditions as of the date of the Participant’s death, Disability or Retirement. If the Participant’s death, Retirement or Disability occurs prior to the end of the Vesting Period, or if prior to the end of the Vesting Period, the Participant’s employment is terminated under circumstances that entitle the Participant to severance benefits under the Northern Trust Corporation Severance Plan (the “Severance Plan”) and the Participant has executed and not revoked a settlement agreement, waiver and release under the Severance Plan (a “Release”), then, in each such case, subject to clause (c) below, the Participant shall have credited, and be deemed vested in, on such date of death, Retirement or Disability or date of termination of employment, a pro-rated number of Stock Units based on the total number of Stock Units granted, the manner of vesting, the number of months elapsed since the date of grant, and the number of months remaining in the Vesting Period, as determined by the Committee or the Executive Vice President of Human Resources.

(b) If, prior to the end of the Vesting Period, a Participant’s employment with the Corporation or any of its Subsidiaries has terminated and (i) the Participant is a

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Management Committee member on the date of grant, (ii) the Participant is 55 years or older on the date of such termination, and (iii) the Participant has not violated any provision of Paragraph 7 of these Terms and Conditions during the Vesting Period, then, subject to clause (c) below, the Participant shall have credited, and be deemed vested in, on the vesting date of the award, a pro-rated number of Stock Units based on the total number of Stock Units granted, the manner of vesting, the number of months elapsed since the date of grant, and the number of months remaining in the Vesting Period, as determined by the Committee or the Executive Vice President of Human Resources.

(c) Notwithstanding clauses (a) or (b) above, there shall be no vesting of any Stock Units and no proration of any Stock Units unless and until it is determined by the Committee that the Corporation has satisfied the performance criteria for the applicable three-year performance period as set forth in the Award Notice.

9. Voluntary Deferral.

(a) Subject to applicable law, the Participant may elect to defer all or any portion of the Stock Units so that the Participant becomes entitled to the distribution of any vested Stock Units on the anniversary of the vesting date (or the Applicable Date in the case of any Section 16 Participant) in any year that is (i) no earlier than the end of the third calendar year after the calendar year in which the Stock Units vest pursuant to Paragraphs 5 and 8(c) of these Terms and Conditions, and (ii) no later than the fifth calendar year beginning after the Participant’s Retirement or other termination of employment. Notwithstanding the previous sentence, in no event shall distribution of the Stock Units begin earlier than six months following termination of employment, unless due to the Participant’s death, if the Participant was a “Specified Employee” (as defined in Section 409A(a)(2)(B)(i) of the Code) of the Corporation at termination of employment, as determined in accordance with procedures adopted by the Corporation pursuant to Section 409A of the Code and related regulations.

(b) The Participant shall make any election to defer receipt of the payment of all or any portion of the Stock Units by filing a deferral election form with the Corporation within thirty (30) days after the date of grant and at least thirteen (13) months prior to the end of the Vesting Period set forth in the Award Notice.

(c) Distribution of any deferred Stock Units pursuant to this Paragraph 9 shall be made at one time or in up to five (5) annual installments, as the Participant shall have elected in the deferral election form described in clause (b) above. If the Participant has elected an installment distribution, the initial installment shall be distributed as soon as practical after the anniversary of the vesting date (or the Applicable Date in the case of any Section 16 Participant) in the first year to which distribution has been deferred, and the remaining installments shall be distributed on each anniversary date of the initial distribution.

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10. Delivery of Shares. The Corporation shall not be required to issue or deliver any shares of Common Stock pending compliance with applicable federal and state securities laws (including any registration required) and compliance with applicable stock exchange rules and practices. The Corporation shall use its reasonable efforts to cause compliance with those laws, rules and practices.

11. Adjustment. The Stock Units provided herein are subject to adjustment in accordance with the provisions of Section 11 of the Plan.

12. No Right to Employment. Nothing in the Plan or the Stock Unit Agreement shall be construed as creating any right in the Participant to continued employment or as altering or amending the existing terms and conditions of employment of the Participant except as otherwise specifically provided in the Stock Unit Agreement.

13. Nontransferability. No interest hereunder of the Participant is transferable except as provided in the Stock Unit Agreement.

14. Withholding. The Corporation shall have the right to deduct from any distribution made hereunder in cash any sum required to be withheld by the Corporation for federal, state or local taxes. In the case of any distribution made hereunder in shares of Common Stock, the Corporation requires as a condition of distribution that the Participant or the Participant’s beneficiary pay the Corporation the amount which the Corporation determines to be required to be withheld for federal, state or local taxes. The tax withholding obligation with respect to shares of Common Stock shall be satisfied by the Corporation’s withholding a portion of such shares otherwise distributable to the Participant. Any shares withheld shall be valued at their fair market value as of the date of distribution.

15. Administration. The Plan is administered by the Committee. The rights of the Participant hereunder are expressly subject to the terms and conditions of the Plan (including continued shareholder approval of the Plan), together with such guidelines as have been or may be adopted from time to time by the Committee. The Participant hereby acknowledges receipt of a copy of the Plan.

16. No Rights as Shareholder. Except as provided herein, the Participant will have no rights as a shareholder with respect to the Stock Units.

17. Interpretation. Any interpretation by the Committee of the terms and conditions of the Plan, the Stock Unit Agreement or any guidelines shall be final. The Stock Unit Agreement shall be construed under the laws of the State of Illinois without regard to the conflict of law provisions of any state.

18. Sole Agreement. The Stock Unit Agreement, together with the Plan, is the entire Agreement between the parties hereto, all prior oral and written representations being merged herein. No amendment or modification of the terms of the Stock Unit Agreement shall be binding on either party unless reduced to writing and signed by the party to be bound. The Stock Unit Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors.

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19. Definitions. Capitalized terms not defined in the Stock Unit Agreement shall have the meanings assigned to them in the Plan. For purposes of the Stock Unit Agreement:

(a) “Client” means any person or entity with which the Corporation, or any of its Subsidiaries, did business and with which the Participant had contact, or about which the Participant had access to Confidential Information, during the last twelve (12) months of his or her employment.

(b) “Competitive Service or Product” means any service or product: (i) that is substantially similar to or competitive with any service or product that the Participant created or provided, or of which the Participant assisted in the creation or provision, during his or her employment by the Corporation or any of its Subsidiaries; or (ii) about which the Participant had access to Confidential Information during his or her employment by the Corporation or any of its Subsidiaries.

(c) “Confidential Information” means any trade secrets or other information, including, but not limited to, any client information (for example, client lists, information about client accounts, borrowings, and current or proposed transactions), any internal analysis of clients, marketing strategies, financial reports or projections, business or other plans, data, procedures, methods, computer data or system program or design, devices, lists, tools, or compilation, which relate to the present or planned business of the Corporation or any of its Subsidiaries and which has not been made generally known to the public by authorized representatives of the Corporation.

(d) “Prospective Client” means any person or entity to which the Corporation, or any of its Subsidiaries, provided, or from which the Corporation, or any of its Subsidiaries received, a proposal, bid, or written inquiry (general advertising or promotional materials and mass mailings excepted) and with which the Participant had contact, or about which the Participant had access to Confidential Information, during the last twelve (12) months of his or her employment.

(e) “Solicit” and “Solicitation” (with respect to Clients or Prospective Clients) mean directly or indirectly, and without the Corporation’s written authorization, to invite, encourage, request, or induce (or to assist another to invite, encourage, request or induce) any Client or Prospective Client of the Corporation, or any of its Subsidiaries, to: (i) surrender, redeem or terminate a product, service or relationship with the Corporation, or any of its Subsidiaries; (ii) obtain any Competitive Service or Product from the Participant or any third party; or (iii) transfer a product, service or relationship from the Corporation, or any of its Subsidiaries, to the Participant or any third party.

Dated: February 20, 2007

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Exhibit A

The Stock Units will vest if and to the extent the Corporation satisfies, as the Committee shall determine in its sole discretion in 2010, the average annual earnings per share for the three-year performance period beginning on January 1, 2007 and ending on December 31, 2009, as set forth below.

Average Annual Three-Year Earnings Per Share		Percentage of Stock Units Vested
12.0% or higher	............	125.0%
11.5%	............	117.5%
11.0%	............	110.0%
10.5%	............	105.0%
10.0%	............	100.0%
9.5%	............	95.0%
9.0%	............	90.0%
8.5%	............	82.5%
8.0%	............	75.0%
Less than 8.0%	............	0.0%

“Full vesting” in the event of a Change in Control, as required by paragraph 5(c) of the Terms and Conditions, shall mean vesting of the Stock Units at the maximum level (125.0%) in the table above.

The average annual earnings per share shall be the mathematical mean of the earnings per share for each year in the three-year period rounded to the nearest one-tenth of a percent. The final percentage of the Stock Units vesting shall be determined by interpolation between percentage levels.

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EX-10.(III)

Exhibit 10(iii)

TERMS AND CONDITIONS

2007 EXECUTIVE STOCK OPTION

NORTHERN TRUST CORPORATION 2002 STOCK PLAN

1. Governing Documents. Your stock option grant is subject to the provisions of the Northern Trust Corporation 2002 Stock Plan (the “Plan”) and the stock option notice (the “Option Notice”). The Option Notice and these Terms and Conditions constitute the “Stock Option Agreement” as defined in the Plan. If there is any conflict between the information in the Stock Option Agreement and the Plan, the Plan will govern. These Terms and Conditions apply to non-qualified stock options and incentive stock options issued under the Plan.

2. Amendments. The Compensation and Benefits Committee of the Board of Directors (the “Committee”) may amend the terms of the Plan or the Stock Option Agreement at any time, except that any amendment that adversely affects your rights in any material way requires your written consent.

3. Exercise Limitations. Your stock option is exercisable from and after the vesting date(s) set forth on the Option Notice until the ten (10)-year anniversary of the date the option was granted (the “Expiration Date”), except as provided below:

• Change in Control. Your stock option (whether vested or unvested) becomes vested and exercisable from and after the date of a “Change in Control” (as defined in the Plan) of the Corporation. Please see “Other Termination of Employment” below for additional provisions relating to a “Change in Control.”

• Death. If you die while employed, your stock option (whether vested or unvested) becomes vested and exercisable as of the date of your death and may be exercised by your beneficiary at any time until the earlier of (a) five (5) years following your death and (b) the Expiration Date. If you do not name a beneficiary (or your beneficiary dies before you), your stock option will pass to the following persons in the order indicated:

• Your spouse; if none, then,

• Your children (in equal amounts); if none, then,

• Your parents (in equal amounts); if none, then,

• Your brothers and sisters (in equal amounts); if none, then,

• Your estate.

• Retirement. If you retire, your stock option continues to vest in accordance with its terms, and, once vested, it may be exercised at any time until the earlier of (a)

five (5) years following the effective date of your retirement and (b) the Expiration Date. The terms “retire” and “retirement” mean retirement occurring by reason of your having qualified for a Normal, Early, or Postponed Retirement Pension under The Northern Trust Company Pension Plan. You should be aware that an unexercised incentive stock option automatically converts into a non-qualified stock option three (3) months after termination of employment due to retirement pursuant to the applicable provisions of the Internal Revenue Code of 1986, as amended (the “Code”) relating to incentive stock options.

• Special Circumstances. If (a) on the date of grant, you are a Management Committee member, and (b) on the date of your termination of employment, you are age 55 or older and have a minimum of 10 years of employment with the Corporation or its Subsidiaries, then your stock option continues to vest in accordance with its terms, and, once vested, it may be exercised at any time until the earlier of (i) five (5) years following the date of your termination of employment and (ii) the Expiration Date. You should be aware that an unexercised incentive stock option automatically converts into a non-qualified stock option three (3) months after termination of employment under the described circumstances pursuant to the applicable provisions of the Code.

• Disability. If you become disabled while employed, your stock option (whether vested or unvested) becomes vested and exercisable upon your disability and may be exercised at any time until the earlier of (a) five (5) years following your disability, and (b) the Expiration Date. The term “disability” means a disability that continues for a period of 12 months as defined by Northern Trust’s Managed Disability Program, at which date you are terminated from the Plan. You should be aware that an unexercised incentive stock option automatically converts into a non-qualified stock option three months after termination from the Plan due to disability pursuant to the applicable provisions of the Code relating to incentive stock options.

• Severance. If your employment is terminated under circumstances that entitle you to severance benefits under the Northern Trust Corporation Severance Plan (the “Severance Plan”), and you have executed and not revoked a settlement agreement, waiver and release under the Severance Plan (a “Release”), your stock option (whether vested or unvested) becomes vested and exercisable as of the date of your termination of employment and may be exercised at any time until the earlier of (a) one-hundred and eighty (180) days following your termination of employment under the Severance Plan and (b) the Expiration Date. If you are eligible for a Normal, Early, or Postponed Pension Retirement Pension upon termination of employment under the Severance Plan, your stock option (whether vested or unvested) becomes vested and exercisable as of the date of your termination of employment and may be exercised at any time until the earlier of (a) five (5) years following the effective date of your retirement and (b) the Expiration Date. You should be aware that an unexercised incentive stock option automatically converts into a non-qualified stock option three (3) months after termination of employment in these circumstances pursuant to the applicable provisions of the Code relating to incentive stock options.

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• Other Termination of Employment. Except as set forth below, if (a) your employment terminates for any reason other than death, retirement or a severance under the Severance Plan for which you have executed and not revoked a Release, and (b) you are not terminated from the Plan due to disability pursuant to the “Disability” provisions described above, your stock option, if and to the extent vested as of the date of your termination of employment, may be exercised at any time until the earlier of (i) three (3) months following the date of your termination of employment and (ii) the Expiration Date. Your stock option, if and to the extent unvested as of the date of your termination of employment, expires as of the date of your termination of employment. A termination of employment shall not be deemed to occur by reason of your transfer between the Corporation and a Subsidiary of the Corporation or between two Subsidiaries of the Corporation. The post-termination exercise provision of this sub-paragraph shall apply to you if you become a consultant to the Corporation or a Subsidiary of the Corporation upon termination of your employment from the Corporation or a Subsidiary of the Corporation. Notwithstanding the foregoing, if, within the two-year period following a Change in Control, (A) your employment by the Corporation or a subsidiary of the Corporation is terminated for any reason other than death, retirement or a severance under the Severance Plan for which you have executed and not revoked a Release, and (B) you are not terminated from the Plan due to disability pursuant to the “Disability” provisions described above, then (except as may otherwise be specified in an Employment Security Agreement between you and the Corporation), your stock option, to the extent vested, may be exercised at any time until the earlier of (I) six (6) months following the date of your termination of employment, and (II) the Expiration Date; provided, however, you should be aware that an unexercised incentive stock option automatically converts into a non-qualified stock option three (3) months after termination of employment in connection with a Change of Control pursuant to the applicable provisions of the Code relating to incentive stock options.

4. Re-Employment. If, after your termination of employment, you are re-employed by the Corporation or one of its Subsidiaries, upon your return you will be considered a new hire. Options that previously expired upon your termination of employment remain expired and are not reinstated.

5. Exercise of Options.

• How to Exercise. You may exercise your stock option through the H. R. Service Center at (800) 807-0302 or online through My Place. Inquiry and modeling capabilities are also available online.

• Black-out Period. Due to federal securities law concerns, the Corporation has a “black-out” policy which restricts any exercise of your stock option around quarterly corporate earnings announcements. Please refer to the “Statement of

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Confidential Information and Securities Trading” for further information about the Corporation’s black-out policy. You may access this document online through inside northern. From the homepage click on Corporate, and then Corporate Policies.

6. Nontransferability. Your stock option is not transferable other than as provided in these Terms and Conditions, except that you, with the prior approval of the Committee, may transfer a non-qualified stock option (but not an incentive stock option) under certain circumstances and subject to the terms and conditions of the Plan and such limits as the Committee may establish, and the transferee shall remain subject to all the terms and conditions applicable to the non-qualified stock option prior to the transfer. Except as described in the prior sentence, your stock option (whether a non-qualified stock option or an incentive stock option) is exercisable, during your lifetime, only by you or your personal representative. Additional written information regarding the mechanics and consequences of transferring a non-qualified stock option is available from the Corporate Secretary. You should request and review this information prior to making a request to transfer a non-qualified stock option.

7. Delivery of Shares. Delivery of shares of Common Stock upon exercise of your stock option is subject to the withholding of all applicable federal, state, and local taxes. At your election, any tax withholding obligation shall be satisfied by the Corporation’s withholding a portion of the shares otherwise distributable to you at a rate acceptable to the Corporation or by your delivery of previously acquired shares, up to the maximum rate. Payment of federal income taxes may be accomplished through a combination of withholding of shares and delivery of previously acquired shares. If at any time the Corporation shall be advised by its counsel that the shares deliverable upon an exercise of the option must be accompanied or preceded by a prospectus meeting the requirements of the Securities Act of 1933 or any State securities law, or that the Corporation must comply with the rules of any securities exchange on which its common stock is traded, the Corporation will use its reasonable best efforts to deliver such prospectus and to comply with the rules of such securities exchange not later than a reasonable time following the exercise of the option, but the delivery of shares by the Corporation may be deferred until such prospectus is available or the Corporation complies with the rules of such securities exchange. As an option holder, you have no interest in the shares covered by the option until the shares are actually issued.

8. Restricted Activity. Despite anything to the contrary in these Terms and Conditions, your stock options (whether vested or unvested) shall be forfeited and the Corporation shall have no obligation to honor the exercise of the stock options by you (or your beneficiary), if you:

(a) at any time after the date of these Terms and Conditions, have divulged, directly or indirectly, or used for your own or another’s benefit, any Confidential Information; or

(b) at any time after the date of these Terms and Conditions and through a period of twelve (12) months after you cease to be employed by the Corporation or any of its Subsidiaries for any reason, have Solicited, or assisted in the Solicitation of, any Client or Prospective Client; or solicited, encouraged, advised, induced or caused any employee of the Corporation or any of its Subsidiaries to terminate his

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or her employment with the Corporation or any of its Subsidiaries, or provided any assistance, encouragement, information, or suggestion to any person or entity regarding the solicitation or hiring of any employee of the Corporation or any of its Subsidiaries; provided, however, that this clause (b) shall not prohibit any Solicitation of any Client or Prospective Client with whom you had a business relationship prior to the start of your employment with the Corporation or any of its Subsidiaries, provided no Confidential Information, directly or indirectly, is used in each Solicitation.

(c) If you shall have so engaged in any such activity described in clauses (a) or (b) above without the written consent of the Corporation, your stock options (whether vested or unvested) shall be forfeited to the Corporation by notice in writing to you within a reasonable period of time after the Corporation acquires knowledge of your violation of this Section 8. Any failure by you to comply with this Section 8 shall entitle the Corporation, as determined by the Committee in its sole discretion, to (i) cancel and terminate all of your unexercised, unexpired or unpaid stock options (whether vested or unvested) under the Plan, and (ii) rescind any exercise, payment or delivery under any stock option occurring within twelve (12) months prior to, or at any time following, the date of your termination of employment for any reason (including but not limited to termination of employment due to retirement or disability). Upon any such rescission, (1) you shall immediately pay to the Corporation the amount of any gain realized or payment received, and (2) you shall immediately forfeit to the Corporation any shares of the Corporation’s Common Stock received, in each case as a result of the rescinded exercise, payment or delivery under any stock options, in such manner and on such terms and conditions as the Committee shall require, and the Corporation shall be entitled, as permitted by applicable law, to deduct from any amounts the Corporation owes you from time to time the amount of any such gain realized or payment received. “Gain realized” shall be the excess of the fair market value of the Corporation’s common stock on the date of exercise over the option exercise price, multiplied by the number of shares purchased.

9. No Contract of Employment. The option grant shall not be deemed to obligate the Corporation or any of its Subsidiaries to continue your employment for any particular period, nor is employment guaranteed for the length of the vesting schedule set forth in the Option Notice.

10. Taxes. Please refer to the “Summary Description of the Northern Trust Corporation 2002 Stock Plan” for a description of the U.S. federal income tax consequences affecting non-qualified stock options and incentive stock options.

11. Applicable Law. All questions pertaining to the validity, construction and administration of the Plan and the stock option grants to which the Option Notice and these Terms and Conditions apply shall be determined in conformity with the laws of the State of Illinois, without regard to the conflict of law provisions of any state.

12. Definitions. Capitalized terms not defined in the Stock Option Agreement shall have the meanings assigned to them in the Plan. For purposes of the Stock Option Agreement:

(a) “Client” means any person or entity with which the Corporation, or any of its Subsidiaries, did business and with which you had contact, or about which you had access to Confidential Information, during the last twelve (12) months of your employment.

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(b) “Competitive Service or Product” means any service or product: (i) that is substantially similar to or competitive with any service or product that you created or provided, or of which you assisted in the creation or provision, during your employment by the Corporation or any of its Subsidiaries; or (ii) about which you had access to Confidential Information during your employment by the Corporation or any of its Subsidiaries.

(c) “Confidential Information” means any trade secrets or other information, including, but not limited to, any client information (for example, client lists, information about client accounts, borrowings, and current or proposed transactions), any internal analysis of clients, marketing strategies, financial reports or projections, business or other plans, data, procedures, methods, computer data or system program or design, devices, lists, tools, or compilation, which relate to the present or planned business of the Corporation or any of its Subsidiaries and which has not been made generally known to the public by authorized representatives of the Corporation.

(d) “Prospective Client” means any person or entity to which the Corporation, or any of its Subsidiaries or affiliates, provided, or from which the Corporation, or any of its Subsidiaries received, a proposal, bid, or written inquiry (general advertising or promotional materials and mass mailings excepted) and with which you had contact, or about which you had access to Confidential Information, during the last twelve (12) months of your employment.

(e) “Solicit” and “Solicitation” (with respect to Clients or Prospective Clients) mean directly or indirectly, and without the Corporation’s written authorization, to invite, encourage, request, or induce (or to assist another to invite, encourage, request or induce) any Client or Prospective Client of the Corporation, or any of its Subsidiaries, to: (i) surrender, redeem or terminate a product, service or relationship with the Corporation, or any of its Subsidiaries; (ii) obtain any Competitive Service or Product from you or any third party; or (iii) transfer a product, service or relationship from the Corporation, or any of its Subsidiaries, to you or any third party.

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EX-10.(IV)

Exhibit 10(iv)

2007 DIRECTOR STOCK AGREEMENT

UNDER THE NORTHERN TRUST CORPORATION

2002 STOCK PLAN

This Agreement is entered into as of the 20^th day of February, 2007, between Northern Trust Corporation (“Northern”) and                          (“Participant”).

The Northern Trust Corporation 2002 Stock Plan (“Plan”) provides in Section 10 of the Plan for the awarding of stock units (“Stock Units”) to participants, who may include directors of Northern who are not employees of the Corporation or its Subsidiaries (collectively, the “Corporation”), as approved by the Compensation and Benefits Committee (“Committee”) of the Board of Directors of Northern.

In the exercise of its discretion under the Plan, the Committee has determined that the Participant should participate in the Plan and receive an award of Stock Units under Section 10 of the Plan, and, accordingly, Northern and the Participant hereby agree as follows:

1. Grant. Northern hereby grants to the Participant an award of Stock Units equal in value to $80,000, as determined by the closing sale price of Northern’s Common Stock (as defined below) on the date of the 2007 annual meeting of stockholders, subject to the terms and conditions of the Plan and this Agreement. A Stock Unit is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of common stock (“Common Stock”), pursuant to Paragraph 6 of this Agreement.

2. Stock Unit Account. Northern shall maintain an account (“Stock Unit Account”) on its books in the name of the Participant which shall reflect the number of Stock Units awarded to the Participant that the Participant is eligible to receive in distribution pursuant to Paragraph 6 of this Agreement.

3. Dividend Equivalents. Except as provided below in Paragraph 7 of this Agreement, upon the payment of any dividend on Common Stock occurring during the period preceding the distribution of the Participant’s Stock Unit award pursuant to Paragraph 6 of this Agreement, Northern shall promptly pay to the Participant an amount in cash equal in value to the dividends that the Participant would have received had the Participant been the actual owner on the record date of the number of shares of Common Stock represented by the Stock Units in the Participant’s Stock Unit Account on that date (“Dividend Equivalents”).

4. Forfeiture. If the Participant’s service on the Board of Directors of Northern terminates for any reason prior to the vesting date set forth in Exhibit A to this Agreement, the Participant’s Stock Units shall be forfeited and revert to Northern, and Northern shall have no further obligation after such date to pay Dividend Equivalents pursuant to Paragraph 3 of this Agreement. Northern shall have no further obligation to the Participant under this Agreement with respect to such Stock Units.

5. Vesting. The Stock Units shall become vested as provided in Exhibit A to this Agreement.

6. Distribution. Except as provided below in Paragraph 7 of this Agreement, the Participant’s Stock Units shall be distributed to the Participant as soon as practicable after vesting. Stock Units shall be distributed only in shares of Common Stock so that, pursuant to Paragraph 1 of this Agreement and this Paragraph 6, a Participant shall be entitled to receive one share of Common Stock for each Stock Unit in the Participant’s Stock Unit Account. No distribution shall be made prior to the first date that shares of Common Stock may be distributed to the Participant without penalty or forfeiture under federal or state laws or regulations governing short swing trading of securities. In determining whether a distribution would result in such a penalty or forfeiture, Northern may rely upon information reasonably available to it or upon representations of the Participant’s legal or personal representative.

If a Participant’s service on the Board of Directors of Northern shall terminate by reason of death, or if the Participant shall die after becoming entitled to distribution hereunder, but prior to receipt of the entire distribution, all cash (as provided in Paragraph 7) or Common Stock then distributable hereunder with respect to the Participant shall be distributed to such individual, trustee, trust or other entity (“Beneficiary”) as the Participant shall have designated by an instrument in writing last filed with Northern prior to death, or in the absence of a designation, to the following persons in the order indicated below:

• The Participant’s spouse; if none, then,

• The Participant’s children (in equal amounts); if none, then,

• The Participant’s parents (in equal amounts); if none, then,

• The Participant’s brothers and sisters (in equal amounts); if none, then,

• The Participant’s estate.

Such distribution shall be made as soon as practicable after the death of the Participant.

7. Voluntary Deferral.

(a) Subject to applicable law, the Participant may elect to defer receipt of the payment of all or any portion of the Stock Units until the date on which the Participant’s service on the Board of Directors of Northern terminates. Any such election would likewise apply to the Dividend Equivalents payable with respect to such deferred Stock Units. Deferred Dividend Equivalents shall be credited to a cash account with respect to the Stock Units (“Cash Account”) maintained by Northern on its books in the name of the Participant. Until the entire balance of a Cash Account has been paid to the Participant or to the Participant’s Beneficiaries (as defined in Paragraph 6), such balance shall be adjusted on the last day of each calendar quarter to reflect accrued interest on such balance based on the rate of interest determined from time to time by the Committee.

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(b) The Participant shall make any election to defer receipt of the payment of all or any portion of the Stock Units and related Dividend Equivalents to the date of his or her termination of service on the Board by filing a deferral election form with the Committee within thirty (30) days after the date of this Agreement and at least thirteen (13) months prior to the vesting date set forth in Exhibit A.

(c) The entire balance of deferred Stock Units in the Stock Unit Account and deferred Dividend Equivalents in the Cash Account shall be paid to the Participant or to the Beneficiaries of the Participant (i) in a single lump sum on the 10th business day following the date the Participant’s service on the Board of Directors of Northern terminates for any reason, or (ii) in up to 10 annual installments beginning on the 10th business day following the date the Participant’s service on the Board of Directors of Northern terminates for any reason, as designated by the Participant in the election form described in clause (b) above. In the absence of a designation, the entire balance of deferred Stock Units in the Stock Unit Account and deferred Dividend Equivalents in the Cash Account shall be paid in a single lump sum.

(d) Deferred Stock Units in the Stock Unit Account shall be distributed only in shares of Common Stock. In the event of a single lump sum distribution in Common Stock, a certificate (or a non-certificated book entry) representing the number of full shares of Common Stock equal to the number of such Stock Units in the Stock Unit Account, registered in the name of the Participant or the Beneficiaries of the Participant, shall be distributed to the Participant or the Beneficiaries of the Participant, on the distribution date referred to in Paragraph 7(c) above. In the event of a distribution in Common Stock in up to 10 annual installments, a certificate (or a non-certificated book entry) representing the number of full shares of Common Stock equal to a fraction (the numerator of which shall be the number of Stock Units in the Stock Unit Account, and the denominator of which shall be the number of annual installments designated by the Participant), registered in the name of the Participant or the Beneficiaries of the Participant, shall be distributed to the Participant or the Beneficiaries of the Participant, on the distribution date in each year of the installment period, provided that the number of shares in each of the installments may be rounded to avoid fractional shares and the effects of any such rounding shall be reflected in the last installment.

(e) Deferred Dividend Equivalents in the Participant’s Cash Account shall be distributed in cash. In the event of a single lump sum distribution in cash, the entire balance of the Participant’s Cash Account shall be distributed to the Participant or the Beneficiaries of the Participant on the distribution date described in Paragraph 7(c) above. In the event of a distribution in cash in up to 10 annual installments, the balance of the Cash Account shall continue to accrue interest and shall be distributed to the Participant or the Beneficiaries of the Participant on the distribution date in each year of the installment period in an amount equal to the then current balance in the Cash Account multiplied by a fraction, the numerator of which shall be one, and the denominator of which shall be the number of years remaining in the installment period.

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8. Delivery of Shares. Northern shall not be required to issue or deliver any shares of Common Stock pending compliance with applicable federal and state securities laws (including any registration required) and compliance with applicable stock exchange rules and practices. Northern shall use its reasonable efforts to cause compliance with those laws, rules and practices.

9. Adjustment. The Stock Units provided herein are subject to adjustment in accordance with the provisions of Section 11 of the Plan.

10. No Obligation to Reelect. Nothing in the Plan or this Agreement shall be deemed to create an obligation on the part of the Board of Directors to nominate the Participant for reelection by Northern’s stockholders or to fill any vacancy upon action of the Board of Directors.

11. Nontransferability. No interest hereunder of the Participant or any Beneficiary shall be assignable or transferable by voluntary or involuntary act or by operation of law other than by testamentary bequest or devise or the laws of descent or distribution, all rights hereunder shall be wholly unalienable and beyond the power of any person to anticipate or in any way create a lien or encumbrance thereon; and distribution shall be made only to (i) the Participant, (ii) the Participant’s personal representative in the event of the Participant’s adjudicated disability, or (iii) the Participant’s Beneficiaries in the event of the Participant’s death, upon his, her or their own personal receipts or endorsements. Any effort to exercise the powers herein denied shall be wholly ineffective and shall be grounds for termination by the Committee of all rights hereunder.

12. Withholding. Northern shall have the right to deduct from any distribution hereunder in cash any sum required to be withheld by Northern for federal, state or local taxes. In the case of any distribution made hereunder in shares of Common Stock, Northern requires as a condition of distribution that the Participant or the Participant’s Beneficiary pay Northern the amount which Northern determines to be required to be withheld for federal, state or local taxes. The tax withholding obligation with respect to shares of Common Stock shall be satisfied by Northern’s withholding a portion of such shares otherwise distributable to the Participant. Any shares withheld shall be valued at their fair market value as of the date of distribution.

13. Administration. The Plan is administered by the Committee. The rights of the Participant hereunder are expressly subject to the terms and conditions of the Plan (including continued shareholder approval of the Plan), together with such guidelines as have been or may be adopted from time to time by the Committee. The Participant hereby acknowledges receipt of a copy of the Plan.

14. No Rights as Shareholder. Except as provided herein, the Participant will have no rights as a shareholder with respect to the Stock Units.

15. Interpretation. Any interpretation by the Committee of the terms and conditions of the Plan, this Agreement or any guidelines shall be final. This Agreement shall be construed under the laws of the State of Illinois without regard to the conflict of law provisions of any state. Capitalized terms not defined in this Agreement shall have the meanings assigned to them in the Plan.

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16. Sole Agreement. This Agreement, together with the Plan, is the entire Agreement between the parties hereto, all prior oral and written representations being merged herein. No amendment or modification of the terms of this Agreement shall be binding on either party unless reduced to writing and signed by the party to be bound. This Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors.

IN WITNESS WHEREOF, the Participant and Northern Trust Corporation by its duly authorized officer have signed this Agreement the day and year first written above.

Northern Trust Corporation
By:
	Its Chairman and Chief Executive Officer
Participant

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Exhibit A

The Stock Units will vest 100% on the date of the Corporation’s 2008 Annual Meeting of Stockholders.

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EX-10.(V)

Exhibit 10(v)

AMENDED AND RESTATED

NORTHERN TRUST CORPORATION 2002 STOCK PLAN

1. Purpose. The purpose of the Amended and Restated Northern Trust Corporation 2002 Stock Plan is to promote the growth and profitability of the Corporation and its Subsidiaries by (a) encouraging outstanding individuals to accept or continue employment with the Corporation and its Subsidiaries or to serve as Directors of the Corporation, and (b) providing those persons with incentive compensation opportunities in the form of Stock Options and other Awards based on the value or increase in the value of shares of Common Stock of the Corporation, thereby aligning their interests with those of the Corporation’s stockholders.

2. Administration.

(a) The Committee shall administer the Plan, except as otherwise determined by the Board. The Committee shall consist of at least two (2) Directors as the Board may designate from time to time. Notwithstanding anything to the contrary contained herein, membership of the Committee shall be limited to Board members who meet the “non–employee director” definition in Rule 16b–3 under Section 16 of the Exchange Act and the “outside director” definition under Section 162(m) of the Code and the regulations thereunder.

(b) The Committee shall have full power and authority to interpret the Plan, to establish, amend and rescind any rules and regulations relating to the Plan, to determine the terms and provisions of any Award Agreement entered into under the Plan, and to make all other determinations that may be necessary or desirable for the administration of the Plan. Any interpretation of the Plan by the Committee shall be final and binding on all persons.

(c) The Committee may delegate the administration of the Plan, in whole or in part, on such terms and conditions as it may impose, to such other person or persons as it may determine in its discretion, except with respect to Awards to officers subject to Section 16 of the Exchange Act or officers who are or may be Covered Employees and except to the extent prohibited by applicable law or the applicable rules of a stock exchange.

3. Participants.

(a) Participants shall consist of Directors and Employees whom the Committee may designate from time to time to receive Awards under the Plan. Awards may be granted to Participants who are or were previously Participants under this or other plans of the Corporation or any Subsidiary and, with the agreement of the Participant, may be granted in substitution, exchange or cancellation of any rights or benefits then or theretofore held under this or other plans of the Corporation or any Subsidiary. The Corporation may continue to award bonuses and other compensation to Participants under other programs now in existence or hereafter established.

(b) The Committee shall have the authority to amend the Plan or the terms and conditions relating to an Award to the extent necessary or appropriate to comply with applicable law, regulation or accounting rules in order to permit Employees who are located outside of the United States to participate in the Plan.

4. Awards.

(a) The following types of Awards may be granted under the Plan, either alone or in combination with other Awards: (i) Stock Options, (ii) Stock Appreciation Rights, (iii) Performance Shares, (iv) Stock Awards and (v) Stock Units.

(b) The Committee may, in its discretion, provide that any Award granted under the Plan shall be subject to the attainment of performance goals in order to qualify such Award as “performance-based compensation” within the meaning of Section 162(m) of the Code. Performance goals may be based on one or more business criteria, including, but not limited to: (i) return on equity, (ii) earnings or earnings per share, (iii) Common

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Stock price, (iv) return on assets, (v) return on investment, (vi) net income, (vii) expense management, (viii) credit quality, (ix) revenue growth, or (x) operating leverage. Corporate performance goals may be absolute in their terms or measured against or in relationship to the performance of other companies or indices selected by the Committee. In addition, corporate performance goals may be adjusted for any events or occurrences (including extraordinary charges, losses from discontinued operations, restatements and accounting charges, and other unplanned special charges such as restructuring expenses, acquisition expenses and strategic loan loss provisions) as may be determined by the Committee. Corporate performance goals may be particular to one or more business units, lines of business or Subsidiaries or may be based on the performance of the Corporation as a whole. The corporate performance goals and the performance targets established thereunder by the Committee may be identical for all Participants for a given performance period or, at the discretion of the Committee, may differ among such Participants.

5. Shares Issuable Under the Plan.

(a) An aggregate of 40,000,000 shares of Common Stock, consisting of authorized but unissued shares or treasury shares, may be issued under the Plan from and after the date of its initial adoption. Such aggregate number of shares shall be adjusted in accordance with the provisions of Section 11 of the Plan.

(b) The maximum number of shares of Common Stock as to which a Participant may receive Stock Options or Stock Appreciation Rights in any calendar year is 500,000, as such number shall be adjusted in accordance with the provisions of Section 11 of the Plan. The maximum number of shares for Awards (other than Stock Options and Stock Appreciation Rights) intended to qualify as “performance-based compensation” in accordance with Section 4(b) of the Plan that may be granted to any Participant in any calendar year is 150,000, as such number shall be adjusted in accordance with the provisions of Section 11 of the Plan. The maximum number of shares of Common Stock issuable under the Plan as Incentive Stock Options is 22,000,000, as such number shall be adjusted in accordance with the provisions of Section 11 of the Plan. The maximum number of shares of Common Stock available for Awards other than Stock Options or Stock Appreciation Rights after April 17, 2007 is 10,000,000, as such number shall be adjusted in accordance with the provisions of Section 11 of the Plan.

(c) Any shares of Common Stock subject to an Award may thereafter be subject to a new Award under the Plan if there is a lapse, cancellation, forfeiture, surrender, expiration or termination of any such prior Award, or if shares are issued under such Award and thereafter are reacquired by the Corporation pursuant to rights reserved by the Corporation upon issuance thereof.

(d) A share of Common Stock subject to a Stock Option and its related Stock Appreciation Right shall only be counted once for purposes of this Section 5.

6. Stock Options. The Committee may, in its discretion, grant Stock Options under the Plan to any Participant hereunder. Each Stock Option granted hereunder shall be subject to such terms and conditions as the Committee may determine at the time of grant, the general provisions of the Plan, the terms and conditions of the applicable Stock Option Agreement, and the following specific rules:

(a) Stock Options granted to a Participant under the Plan shall be governed by a Stock Option Agreement, which shall specify such terms and conditions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine.

(b) Stock Options shall consist of options to purchase Common Stock at exercise prices not less than 100% of the Fair Market Value thereof on the date the Stock Options are granted.

(c) Stock Options shall be exercisable for such period as specified by the Committee, but in no event may Stock Options be exercisable for a period of more than ten years after their date of grant.

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(d) In addition to the general terms and conditions set forth in this Section 6 in respect of Stock Options granted under the Plan, Incentive Stock Options granted under the Plan shall be subject to the following additional terms and conditions: (i) the exercise price of each Incentive Stock Option shall be at least 100% of the Fair Market Value of the Common Stock subject to such Incentive Stock Option on the date of grant; (ii) Incentive Stock Options shall be exercisable not later than ten years after the date of grant; (iii) in the case of an Incentive Stock Option granted to a Participant who, at the time of grant, owns (as determined under Section 424(d) of the Code) stock of the Corporation or its Subsidiaries possessing more than 10% of the total combined voting power of all classes of stock of any such corporation, the exercise price shall be at least 110% of the Fair Market Value of the Common Stock subject to the Incentive Stock Option at the time it is granted, and the Incentive Stock Option, by its terms, shall not be exercisable after the expiration of five (5) years from the date of its grant; and (iv) the aggregate Fair Market Value (determined with respect to each Incentive Stock Option as of the time such Incentive Stock Option is granted) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year (under all Incentive Stock Option plans of the Corporation and its Subsidiaries) shall not exceed $100,000.

(e) Stock Options may provide that they may be exercised by payment of the exercise price (i) in cash, (ii) by the Corporation’s withholding a portion of the shares of Common Stock otherwise distributable to the Participant, (iii) by the Participant’s actual delivery of previously acquired shares of Common Stock that are acceptable to the Committee, (iv) by certification of ownership by attestation of such previously acquired shares, (v) by delivery of a properly executed notice of exercise, together with irrevocable instructions to a broker or similar third party to deliver promptly to the Corporation the amount of sale proceeds from the sale of the option shares to pay the exercise price and any withholding taxes due to the Corporation, or (vi) by any other method of payment as the Committee, in its discretion, deems appropriate. In the event that the exercise price of a Stock Option is paid in whole or in part by the withholding or delivery of shares of Common Stock pursuant to clause (ii), (iii) or (iv) above, the number of shares so withheld or delivered shall be the number of shares having an aggregate Fair Market Value equal to the exercise price, or portion thereof, so paid.

(f) If a Participant delivers shares of Common Stock to pay all or a part of the exercise price of a Stock Option, or uses shares of Common Stock to satisfy any federal, state or local tax withholding requirements, the Participant may receive, at the discretion of the Committee, an additional Stock Option (“Replacement Option”) equal to the sum of the number of shares delivered in payment of the exercise price and the number of shares used to pay withholding taxes. A Replacement Option shall have a term that shall not extend beyond the term of the Stock Option to which it relates and shall have an exercise price equal to the Fair Market Value of the Common Stock on the grant date of the Replacement Option. Replacement Options may be subject to such other terms and conditions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine. Replacement Options may be granted in connection with the exercise of Stock Options granted under this Plan or any other plan of the Corporation.

(g) The Committee may prescribe such other terms and conditions applicable to Stock Options granted to a Participant under the Plan that are neither inconsistent with nor prohibited by the Plan or any Stock Option Agreement.

7. Stock Appreciation Rights. The Committee may, in its discretion, grant a Stock Appreciation Right under the Plan to the holder of any Stock Option granted hereunder. Each Stock Appreciation Right granted hereunder shall be subject to such terms and conditions as the Committee may determine at the time of grant, the general provisions of the Plan, the terms and conditions of the applicable Stock Appreciation Right Agreement, and the following specific rules:

(a) Stock Appreciation Rights granted to a Participant under the Plan shall be governed by a Stock Appreciation Right Agreement, which shall specify such terms and conditions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine.

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(b) A Stock Appreciation Right may be granted in connection with a Stock Option at the time of the grant of the Stock Option or at any time thereafter up to six months prior to the expiration of the Stock Option.

(c) Each Stock Appreciation Right will entitle the holder to elect to receive, in lieu of exercising the Stock Option to which it relates, an amount (payable in cash or in shares of Common Stock of the Corporation, or a combination thereof, determined by the Committee and set forth in the related Stock Appreciation Right Agreement) of up to 100% (or such lesser percentage as determined by the Committee and set forth in the related Stock Appreciation Right Agreement) of the excess of (i) the Fair Market Value per share of Common Stock on the date of exercise of such Stock Appreciation Right, multiplied by the number of shares of the Common Stock with respect to which the Stock Appreciation Right is being exercised, over (ii) the aggregate exercise price under the terms of the related Stock Option for such number of shares.

(d) Each Stock Appreciation Right will be exercisable at the time and to the extent that the Stock Option to which it relates is exercisable, provided that no Stock Appreciation Right shall be exercisable during the first six months following the date of its grant.

(e) Upon exercise of a Stock Appreciation Right, the Stock Option (or portion thereof) with respect to which such Stock Appreciation Right is exercised and any other Stock Appreciation Rights with respect to such Stock Option (or portion thereof) shall be surrendered to the Corporation and shall not thereafter be exercisable.

(f) Exercise of a Stock Appreciation Right will reduce the number of shares of Common Stock purchasable pursuant to the related Stock Option and available under the Plan to the extent of the total number of shares of Common Stock with respect to which the Stock Appreciation Right is exercised.

(g) The Committee may prescribe such other terms and conditions applicable to Stock Appreciation Rights granted to a Participant under the Plan that are neither inconsistent with nor prohibited by the Plan or any Stock Appreciation Right Agreement.

8. Performance Shares. The Committee may, in its discretion, grant Performance Shares under the Plan to any Participant hereunder. Each Performance Share granted hereunder shall be subject to such terms and conditions as the Committee may determine at the time of grant, the general provisions of the Plan, the terms and conditions of the related Performance Share Agreement, and the following specific rules:

(a) Performance Shares granted to a Participant under the Plan shall be governed by a Performance Share Agreement, which shall specify such terms and conditions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine.

(b) With respect to each performance period, the Committee shall establish such performance goals relating to one or more of the business criteria identified in Section 4(b) of the Plan.

(c) With respect to each performance period, the Committee shall establish targets for Participants for achievement of performance goals. Following the completion of each performance period, the Committee shall determine the extent to which performance goals for that performance period have been achieved and shall authorize credit as of the end of such performance period of Performance Shares to the accounts of Participants for whom targets were established, in accordance with the terms of the applicable Performance Share Agreements.

(d) The Committee may prescribe such other terms and conditions applicable to Performance Shares granted to a Participant under the Plan that are neither inconsistent with nor prohibited by the Plan or any Performance Share Agreement.

9. Stock Awards. The Committee may, in its discretion, grant, or sell for such amount of cash, Common Stock or such other consideration as the Committee deems appropriate (which amount may be less than the Fair Market Value of the Common Stock

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on the date of grant or sale), shares of Common Stock under the Plan to any Participant hereunder. Each share of Common Stock granted or sold hereunder shall be subject to such restrictions, conditions and other terms as the Committee may determine at the time of grant or sale, the general provisions of the Plan, the restrictions, terms and conditions of the related Stock Award Agreement, and the following specific rules:

(a) Shares of Common Stock issued to a Participant under the Plan shall be governed by a Stock Award Agreement, which shall specify whether the shares of Common Stock are granted or sold to the Participant and such other provisions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine.

(b) The Corporation shall issue, in the name of the Participant, stock certificates representing the total number of shares of Common Stock granted or sold to the Participant, as soon as may be reasonably practicable after such grant or sale, which shall be held by the Secretary of the Corporation as provided in subsection (e) hereof.

(c) Subject to the provisions of subsection (b) hereof, and the restrictions set forth in the related Stock Award Agreement, the Participant receiving a grant of or purchasing Common Stock shall thereupon be a stockholder with respect to all of the shares represented by such certificate or certificates and shall have the rights of a stockholder with respect to such shares, including the right to vote such shares and to receive dividends and other distributions paid with respect to such shares.

(d) The Committee, in its discretion, shall have the power to accelerate the date on which the restrictions contained in any Stock Award Agreement shall lapse with respect to any or all shares of Common Stock granted or sold under the Plan.

(e) The Secretary of the Corporation shall hold the certificate or certificates representing shares of Common Stock issued under this Section 9 of the Plan on behalf of each Participant who holds such shares, whether by grant or sale, until such time as the Common Stock is forfeited, resold to the Corporation, or the restrictions lapse.

(f) The Committee may prescribe such other restrictions, terms and conditions applicable to the shares of Common Stock issued to a Participant under the Plan that are neither inconsistent with nor prohibited by the Plan or any Stock Award Agreement, including, without limitation, terms providing for a lapse of the restrictions of this Section 9 or in any Stock Award Agreement, in installments.

(g) Notwithstanding the provisions of subsections (b) and (e) above, the Corporation, in lieu of issuing stock certificates, may reflect the issuance of shares of Common Stock to a Participant on a non–certificated basis, with the ownership of such shares by the Participant evidenced solely by book entry in the records of the Corporation’s transfer agent; provided, however that following the lapse of all restrictions with respect to the shares granted or sold to a Participant, the Corporation, upon the written request of the Participant, shall issue, in the name of the Participant, stock certificates representing such shares.

10. Stock Units. The Committee may, in its discretion, award Stock Units under the Plan to Participants hereunder. Each Stock Unit granted hereunder shall be subject to such terms and conditions as the Committee may determine at the time of grant, the general provisions of the Plan, the terms and conditions of the applicable Stock Unit Agreement and the following specific rules:

(a) Grants of Stock Units to a Participant under the Plan shall be governed by a Stock Unit Agreement, which shall specify such terms and conditions, not inconsistent with the terms and conditions of the Plan, as the Committee shall determine.

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(b) Stock Units shall be denominated in an equal number of shares of Common Stock of the Corporation, as determined by the Committee, and shall be payable either in shares of Common Stock or in cash, as provided in the Stock Unit Agreement.

(c) Any Stock Unit may provide that the Participant shall receive, on the date of payment of any dividend on Common Stock occurring during the period preceding payment of the Award, an amount in cash equal in value to the dividends that the Participant would have received had he been the actual owner of the number of shares of Common Stock designated by the Committee at the time of the Award.

(d) The Corporation’s obligation to make payments or distributions with respect to Stock Units shall not be funded or secured in any manner.

(e) The Committee may prescribe such other terms and conditions applicable to Stock Units granted to a Participant under the Plan that are neither inconsistent with nor prohibited by the Plan or any Stock Unit Agreement.

11. Adjustment. In the event of any reorganization, recapitalization, stock split, stock distribution, merger, consolidation, split-up, spin-off, combination, subdivision, consolidation or exchange of shares, any change in the capital structure of the Corporation or any similar corporate transaction, the Committee or the Board shall make such adjustments as are necessary and appropriate to preserve the benefits or intended benefits of the Plan and Awards granted under the Plan. Such adjustments may include: (a) adjustment in the number and kind of shares reserved for issuance under the Plan; (b) adjustment in the number and kind of shares covered by outstanding Awards; (c) adjustment in the exercise price of outstanding Stock Options and SARs or the price of other Awards under the Plan; (d) adjustments to any of the shares limitations set forth in Section 5 of the Plan; and (e) any other changes that the Committee or the Board determine to be equitable under the circumstances.

12. Nontransferability. Except as provided below, each Award granted under the Plan to a Participant shall not be transferable by the Participant other than by will or the laws of descent and distribution and shall be exercisable, during the Participant’s lifetime, only by the Participant or, in the event of disability, by the Participant’s personal representative. In the event of the death of a Participant during employment or prior to the termination, expiration, cancellation or forfeiture of any Award held by the Participant hereunder, each Award theretofore granted to the Participant shall be exercisable or payable to the extent provided therein but no later than five years after his death and then only:

(a) by or to the executor or administrator of the estate of the deceased Participant or the person or persons to whom the deceased Participant’s rights under the Award shall pass by will or the laws of descent and distribution or as provided in the Award Agreement; and

(b) to the extent set forth in the Award Agreement.

Notwithstanding the foregoing, the Committee may set forth in the Stock Option Agreement for a Non-Qualified Stock Option, at the time of grant or thereafter, that the Non-Qualified Stock Option may be transferred by the Participant, subject to such terms and conditions as may be established by the Committee.

13. Change in Control.

(a) The Committee may, in its discretion, at the time an Award is made hereunder or at any time prior to a Change in Control of the Corporation, provide for the acceleration of any time periods relating to the exercise or realization of such Awards so that such Awards may be exercised or realized as of the date of a Change in Control of the Corporation, including specifically that as of such date: (i) all outstanding Stock Options and Stock Appreciation Rights shall become fully vested and exercisable; (ii) all performance goals under any Award shall be deemed fully achieved; (iii) all outstanding

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Performance Shares shall become fully vested and distributable; (iv) all restrictions on outstanding Stock Awards shall lapse; and (v) all restrictions on outstanding Stock Units shall lapse and such Stock Units shall become fully vested and distributable. The Committee may, in its discretion, include such further provisions and limitations in the Award Agreement as it may deem equitable and in the best interests of the Corporation.

(b) A “Change in Control” shall be deemed to have occurred if:

(i) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Corporation (not including in the securities beneficially owned by such Person any securities acquired directly from the Corporation or its Affiliates) representing 20% or more of the combined voting power of the Corporation’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in clause (A) of paragraph (iii) below; or

(ii) the election to the Board of Directors of the Corporation, without the recommendation or approval of two-thirds of the incumbent Board of Directors of the Corporation, of the lesser of: (A) three directors; or (B) directors constituting a majority of the number of directors of the Corporation then in office, provided, however, that directors whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Corporation will not be considered as incumbent members of the Board of Directors of the Corporation for purposes of this section; or

(iii) there is consummated a merger or consolidation of the Corporation or any direct or indirect subsidiary of the Corporation with any other company, other than (A) a merger or consolidation which would result in the voting securities of the Corporation outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof), at least 60% of the combined voting power of the securities of the Corporation or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, or (B) a merger or consolidation effected to implement a recapitalization of the Corporation (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Corporation (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Corporation or its Affiliates) representing 20% or more of the combined voting power of the Corporation’s then outstanding securities; or

(iv) the stockholders of the Corporation approve a plan of complete liquidation or dissolution of the Corporation or there is consummated an agreement for the sale or disposition by the Corporation of all or substantially all of the Corporation’s assets, other than a sale or disposition by the Corporation of all or substantially all of the Corporation’s assets to an entity, at least 60% of the combined voting power of the voting securities of which are owned by stockholders of the Corporation in substantially the same proportions as their ownership of the Corporation immediately prior to such sale.

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the Common Stock of the Corporation immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Corporation immediately following such transaction or series of transactions.

For purposes of the foregoing, the following definitions shall apply:

“Affiliate” shall have the meaning set forth in Rule 12b-2 under Section 12 of the Exchange Act; “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act, except that a Person shall not be deemed to be the Beneficial Owner of any securities with respect to which such Person has properly filed a form 13-G; “Exchange Act” shall

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mean the Securities Exchange Act of 1934, as amended from time to time; and “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the Corporation or any of its Affiliates, (ii) a trustee or other fiduciary holding securities under an employee benefits plan of the Corporation or any of its subsidiaries, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities or (iv) a corporation owned, directly or indirectly, by the stockholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation.

14. Other Provisions. Any Award under the Plan shall be subject to other provisions as the Committee determines, including, without limitation, provisions for the installment purchase of Common Stock under Stock Options, provisions to assist the Participant in financing the acquisition of Common Stock, provisions for the forfeiture of, or restrictions on resale or other disposition of shares acquired under any Award, provisions to comply with Federal or state securities laws and stock exchange requirements, provisions permitting acceleration of exercise or the lapse of restrictions in the event of death, disability or retirement, understandings or conditions as to the Participant’s employment in addition to those specifically provided for under the Plan, provisions for the forfeiture of Awards in the event of breach of noncompetition or confidentiality agreements during or following termination of employment, provisions permitting the deferral of the receipt of Awards for such period and upon such terms and conditions as the Committee shall determine, provisions giving the Corporation the right to repurchase shares acquired under any Award in the event the Participant elects to dispose of such shares, provisions requiring the achievement of specified performance goals, and provisions permitting acceleration of exercise upon the occurrence of specified events or otherwise in the discretion of the Committee.

15. Taxes. The Corporation shall have the right to deduct from any payment to be made under the Plan the amount of any taxes required by law to be withheld from such payment, or to require a Participant to pay to the Corporation such amount required to be withheld prior to the issuance or delivery of any shares of Common Stock or the payment of any cash in connection with any Award under the Plan. The Committee may, in its discretion and subject to such rules as it may adopt, permit a Participant to elect to satisfy such withholding obligations through cash payment by the Participant, the surrender of shares of Common Stock acceptable to the Committee which the Participant already owns or through the surrender of shares of Common Stock which the Participant is otherwise entitled to receive under the Plan.

16. Amendment, Suspension or Termination of Plan. The Board may at any time amend, suspend or terminate the Plan as it deems advisable and in the best interests of the Corporation; provided, that no amendment, suspension or termination shall adversely affect the right of any Participant under any outstanding Award in any material way without the written consent of the Participant, unless such amendment, suspension or termination is required by applicable law. No amendment of the Plan shall be made without stockholder approval if stockholder approval is required by law, regulation or stock exchange rule.

17. No Contract of Employment. Neither the adoption of the Plan nor the grant of any Award under the Plan shall be deemed to obligate the Corporation or any Subsidiary to continue the employment of any Participant for any particular period, nor shall the granting of an Award constitute a request or consent to postpone the retirement date of any Participant.

18. Effective Date.

(a) The Plan was adopted by the Board on February 19, 2002 and became effective as of April 16, 2002 upon approval by the Corporation’s stockholders at the 2002 annual meeting of stockholders.

(b) Notwithstanding anything to the contrary contained herein, no Awards shall be granted under the Plan on or after April 16, 2012.

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19. Applicable Law. All questions pertaining to the validity, construction and administration of the Plan and all Awards granted under the Plan shall be determined in conformity with the laws of the State of Illinois, without regard to the conflict of law provisions of any state, and, in the case of Incentive Stock Options, Section 422 of the Code and regulations issued thereunder.

20. Definitions. As used in the Plan, the following terms shall have the meanings set forth below:

(a) “Award” shall mean any award or benefit granted under the Plan, including, without limitation, Stock Options, Stock Appreciation Rights, Performance Shares, Stock Awards and Stock Units.

(b) “Award Agreement” shall mean, as applicable, a Stock Option Agreement, Stock Appreciation Agreement, Performance Share Agreement, Stock Award Agreement, Stock Unit Agreement or such other agreement evidencing an Award granted under the Plan.

(c) “Board” shall mean the Board of Directors of the Corporation.

(d) “Change in Control” shall have the meaning set forth in Section 13(b) of the Plan.

(e) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

(f) “Committee” shall mean the Compensation and Benefits Committee of the Board or such other committee of the Board as may be designated by the Board from time to time to administer the Plan.

(g) “Common Stock” shall mean the Common Stock, par value $1.66  ²/3 per share, of the Corporation.

(h) “Corporation” shall mean Northern Trust Corporation, a Delaware corporation.

(i) “Covered Employee” shall mean “covered employee” as that term is defined in Section 162(m) of the Code or any successor provision.

(j) “Director” shall mean a director of the Corporation.

(k) “Employee” shall mean an employee of the Corporation or any Subsidiary; it being understood that an Award (other than an Incentive Stock Option) may be granted in connection with the hiring of a person prior to the date the person becomes an employee of the Corporation or any Subsidiary, provided that such Award shall not vest prior to the commencement of employment.

(l) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

(m) “Fair Market Value” shall mean the fair market value of the Common Stock, as determined by the Committee.

(n) “Incentive Stock Option” shall mean an option granted under Section 6 of the Plan that meets the requirements of Section 422(b) of the Code or any successor provision.

(o) “Non-Qualified Stock Option” shall mean an option granted under Section 6 of the Plan that is not an Incentive Stock Option.

(p) “Participant” shall mean any Employee or Director selected to receive an Award.

(q) “Performance Share” shall mean a grant of a right to receive shares of Common Stock under Section 8 of the Plan.

(r) “Plan” shall mean the Amended and Restated Northern Trust Corporation 2002 Stock Plan.

(s) “Replacement Option” shall mean an option granted under Section 6(f) of the Plan.

(t) “Stock Appreciation Right” shall mean any right granted under Section 7 of the Plan.

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(u) “Stock Award” shall mean a grant of shares of Common Stock under Section 9 of the Plan.

(v) “Stock Option” shall mean an Incentive Stock Option or a Non-Qualified Stock Option granted under Section 6 of the Plan.

(w) “Stock Unit” shall mean a grant of a right to receive shares of Common Stock or cash under Section 10 of the Plan.

(x) “Subsidiary” shall mean any entity that is directly or indirectly controlled by the Corporation or any entity in which the Corporation has a significant equity or other interest, as determined by the Committee in its discretion.

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EX-31.(I)

Exhibit 31(i)

Certification of CEO Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, William A. Osborn, Chief Executive Officer of Northern Trust Corporation, certify that:

1. I have reviewed this report on Form 10-Q for the quarterly period ending March 31, 2007 of Northern Trust Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 30, 2007	/s/ William A. Osborn
	William A. Osborn
	Chief Executive Officer

EX-31.(II)

Exhibit 31(ii)

Certification of CFO Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Steven L. Fradkin, Chief Financial Officer of Northern Trust Corporation, certify that:

1. I have reviewed this report on Form 10-Q for the quarterly period ending March 31, 2007 of Northern Trust Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 30, 2007	/s/ Steven L. Fradkin
	Steven L. Fradkin Chief Financial Officer

EX-32.(I)

Exhibit 32(i)

Certifications of CEO and CFO Pursuant to

18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Northern Trust Corporation (the “Corporation”) on Form 10-Q for the period ending March 31, 2007 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), William A. Osborn, as Chief Executive Officer of the Corporation, and Steven L. Fradkin, as Chief Financial Officer of the Corporation, each hereby certifies, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to the best of his knowledge, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

/s/ William A. Osborn

William A. Osborn

Chief Executive Officer

April 30, 2007

/s/ Steven L. Fradkin

Steven L. Fradkin

Chief Financial Officer

April 30, 2007

This certification accompanies the Report pursuant to section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by Northern Trust Corporation for purposes of section 18 of the Securities Exchange Act of 1934, as amended.

EX-99.(I)

Exhibit 99(i)

EDITED VERSION OF REMARKS DELIVERED BY

WILLIAM A. OSBORN, CHAIRMAN AND CHIEF EXECUTIVE OFFICER, AND

FREDERICK H. WADDELL, PRESIDENT AND CHIEF OPERATING OFFICER,

AT THE ANNUAL MEETING OF STOCKHOLDERS

OF NORTHERN TRUST CORPORATION

HELD APRIL 17, 2007

MR. WILLIAM A. OSBORN:

OVERVIEW

While the votes are being counted, I’d like to give you a brief report on Northern Trust’s progress last year and in the first quarter of 2007. Rick Waddell will then review our businesses and some of our plans going forward.

FULL YEAR 2006 FINANCIAL OVERVIEW

Northern Trust reported excellent financial results in 2006. Net income was up 14% to a record $665 million. Earnings per share were also up 14% to $3.00 per share.

For the year, we achieved positive operating leverage, with revenue growth of 14% exceeding expense growth of 13%. Northern Trust has achieved positive or neutral operating leverage in 16 of the last 19 years – a commendable record achieved through a variety of economic, market and interest rate cycles.

We also successfully gathered client assets during 2006. Assets under custody reached $3.5 trillion at year-end, an increase of 21% versus 2005. Global custody assets, an important and growing sub-component of assets under custody, were up 36% to $1.7 trillion, reflecting our excellent performance in the international arena.

The assets that we manage for our clients also reached record levels in 2006. We ended the year with $697 billion in assets under management, an increase of 13% compared with 2005.

FULL YEAR 2006 FINANCIAL REVIEW

In 2006, we reported record revenues of $3.1 billion and record net income of $665 million. Importantly, we have a long and successful track record of steady and strong growth in both revenues and net income. Our compound annual growth rate in both revenues and net income equaled a respectable 10% over the last decade.

A significant driver of our long term growth in both revenues and net income is our ability to aggregate client assets at a rapid pace. Total assets under custody have increased over the last decade at a compound annual growth rate of 16%, more than double the lift provided by market performance during that period of time, as reflected in 7% growth in the S&P 500 over the decade. Likewise, our total assets under management have grown at a compound annual growth rate of 18% over the same time period.

As I mentioned earlier, our international activities continue to provide significant momentum. Global custody assets, an important and high growth sub-segment of assets under custody, equaled $1.7 trillion at year-end, representing 48% of total assets under custody. Over the last ten years, global custody assets have grown at a 32% rate annually, signifying our success in serving institutional clients around the globe.

Our percentage of global custody assets to total custody assets is the highest among our trust bank peers, reflecting our strength in successfully winning global mandates around the world.

The level of contribution we’re achieving from our international activities also continues to grow, with 35% of net income in 2006 coming from our international businesses. One-quarter of our employee base is outside the United States.

FIRST QUARTER 2007 REVIEW

Earlier this morning, we released our earnings report for the first quarter of 2007. The outstanding financial performance achieved in 2006 continues into 2007. Net income equaled $187 million, increasing 15% versus last year’s first quarter. Earnings per share were 84 cents, an increase of 14% versus last year. We recorded $824 million in revenues during the first quarter of 2007, our first quarterly performance greater than $800 million.

Asset growth continued at a strong pace as well, with assets under custody increasing 20% to $3.8 trillion and assets under management increasing 16% to $756 billion. Of particular note is the continued growth in our international business, as characterized by the 30% year-over-year growth in our global custody assets.

STOCK PERFORMANCE

Northern Trust’s common stock price increased 17% during 2006 and ended the year at $60.69 per share. Equally important, our longer term stock price performance has been strong. The 10-year compound annual growth rate for our stock over the last decade equaled 13%, well ahead of the performance of the S&P 500 index, which grew 7%, and the Keefe, Bruyette & Woods 50 Bank Index, which increased 8% over the same 10-year period.

Let me now hand the podium over to our President and Chief Operating Officer, Rick Waddell, who will provide you with a strategic overview of the businesses and positioning of Northern Trust.

MR. FREDERICK H. WADDELL:

BUSINESS OVERVIEW

My goal is to discuss with you the unique positioning of Northern Trust in the financial services landscape.

Northern Trust is a leading provider of global financial solutions in the investment management, asset administration, fiduciary and banking sectors. We serve clients through two highly targeted distribution channels, Personal Financial Services for private clients and Corporate & Institutional Services for institutional clients.

These two client distribution channels are – in turn – supported by our asset management arm, Northern Trust Global Investments, and our integrated operations and technology unit, Worldwide Operations and Technology. This is a critical differentiator, because our two client-focused businesses are supported by common technology, common operations and common investment management platforms.

Another important differentiator is our focus on administering and managing assets in these two client segments. Put another way, there are a wide array of businesses and product lines in which we do not have a presence or do not represent our core business strategies, including consumer finance, investment banking, venture capital and the credit card arena, to name just a few.

BUSINESS OVERVIEW – PERSONAL FINANCIAL SERVICES

Personal Financial Services is the 118-year heritage of Northern Trust, dating back to our founding in 1889. We are an industry leader in private banking, personal trust and asset management.

Our office network is unmatched in the industry. Since 1990, we have added 49 private client offices to our national network, which now stands at 84 offices in 18 states. We are in close proximity to over 50% of U.S. millionaire households and have offices in 16 of the 20 metropolitan areas in the United States with the greatest number of millionaires. We are researching and pursuing opportunities in several markets where we do not yet have a presence, including Washington, D.C. and Philadelphia.

Northern Trust also is in the enviable position of selling into a rapidly growing market. The growth rates of the millionaire, deca-millionaire, and top tier ultra-wealthy households exceed by a large margin the projected 1.4% growth rate of U.S. households over the next 5 years. In Personal Financial Services, Northern Trust is an industry leader, and we are well positioned to serve a targeted, high growth market.

BUSINESS OVERVIEW – CORPORATE AND INSTITUTIONAL SERVICES

In Corporate and Institutional Services, we serve some of the largest asset pools in the world. We gather assets through the provision of global processing services. We then build on this foundation by adding an array of value-added and profitable asset management, information and risk management services. It is this blend of services – custody plus value-added – that fuels the profitability and growth of C&IS.

Northern Trust’s institutional business is a global one. We are strategically located to take advantage of significant growth opportunities in many regions and market segments around the world. Just a decade ago, our office presence outside of North America was limited to the United Kingdom, Hong Kong and Singapore. Today, we serve clients in 41 countries from 15 locations and have settlement capabilities for our clients in over 90 markets worldwide.

BUSINESS OVERVIEW – NORTHERN TRUST GLOBAL INVESTMENTS

Let me now turn to Northern Trust Global Investments, our asset management unit.

At the end of first quarter 2007, we managed $756 billion in client assets. As Bill Osborn mentioned earlier, we’ve seen excellent growth in assets under management over the years, achieving a compound annual growth rate over the last decade of 18%.

Our asset management business is nicely diversified, reflecting the investment needs of our targeted private and institutional clients. We manage equity, fixed income and short duration assets for clients. We also can break down assets managed by client type, again reflecting the success we have had in our private and institutional client segments. And finally, we manage across investment styles, including a broad array of active, quantitative and manager of manager solutions.

This is a client-focused business, providing investment solutions to our private clients in Personal Financial Services and our institutional clients in Corporate and Institutional Services.

BUSINESS OVERVIEW – AWARDS AND ACCOLADES

In 2006, Northern Trust received a number of awards and accolades in the financial services segments in which we compete. These awards are a tribute to the hard work, dedication and expertise of Northern Trust professionals around the world, and to the positive relationships we have with our clients.

In Personal Financial Services, Euromoney magazine named Northern Trust the “best private bank in the United States.”

In Corporate and Institutional Services, Global Investor magazine named us “Best Sole Custodian” and “Best Global Custodian in Asia,” and International Custody and Fund Administration magazine named us “European Pension Fund Custodian of the Year.”

And in Northern Trust Global Investments, we won several prestigious awards in the securities lending business.

These are but a few of the accolades that we received over the course of the past year.

BUSINESS OVERVIEW – 2006 ACCOMPLISHMENTS

2006 was a year of many significant accomplishments for Northern Trust.

We completed the migration of Insight Investment Management’s investment operations to the Northern Trust platform, representing over 600 portfolios and $190 billion in Insight assets under management. We also completed the integration of the Financial Services Group acquisition and enhanced Northern Trust’s capabilities in providing hedge fund, private equity and property administration to fund manager clients.

In Personal Financial Services, we have developed of a full range of open architecture investment solutions for private clients across all levels of the wealth spectrum.

In Corporate and Institutional Services, we received the “Best Operations Innovation” award for our cross-border pooling product and filed for a patent on this industry-leading capability. Pooling assets grew to approximately $35 billion as of year end and represent a significant future growth opportunity.

In Northern Trust Global Investments, we launched six new mutual funds, generating over $1.8 billion in net new assets under management.

In Worldwide Operations and Technology, we continued investment in our global operating model, through further development of our operations facility in Bangalore, India, and the start-up of a new operations center in Limerick, Ireland.

Most importantly, we achieved continued success in the marketplace, winning new clients around the world, including the Delaware Public Employees’ Retirement System, China’s National Social Security Fund, the Abu Dhabi Retirement Pensions fund, and the New Zealand Superannuation Fund, among many others.

BUSINESS OVERVIEW – POSITIONING FOR GROWTH

Let me conclude by saying we are optimistic about the future, particularly given our strong competitive positioning in the markets in which we compete. We have a number of growth initiatives underway across our businesses.

In Personal Financial Services, we will continue to leverage our heritage as a client-centric provider of financial services, allowing for further growth through the cross-marketing of additional services to our clients. Our work in delivering comprehensive investment solutions to our clients is never done and we will continue in 2007 to listen to our clients’ needs and offer them innovative and customized solutions to meet those needs. And finally, the geographic span of our office network positions us very well to capture opportunities, while at the same time strategically considering new locations for expansion and growth.

In Corporate and Institutional Services, our geographic reach is extensive and has led to significant growth in our international activities over the years. We will continue to extend our geographic reach into new markets in 2007 and beyond. Listening to our clients and offering innovative solutions is a hallmark of Northern Trust and we will continue this focus now and in the future. And, we will continue to identify opportunities to extend our existing institutional product capabilities into new market segments.

In Northern Trust Global Investments, our growth will be around offering comprehensive investment solutions to our clients – whether active, passive or manager of managers. And, we will continue to expand our global distribution of investment products, while capitalizing on our culture of client intimacy.

The leadership team at Northern Trust is very excited about the future and the many growth opportunities that we are capitalizing on. Thank you for your interest in Northern Trust, and I look forward to updating you on our progress in the future.

MR. WILLIAM A. OSBORN:

CLOSING

I’d now be happy to answer any questions you may have.

* * * *

Mr. Osborn’s and Mr. Waddell’s above remarks may be deemed to include forward-looking statements such as statements that relate to Northern Trust’s financial goals, dividend policy, expansion and business development plans, anticipated expense levels and projected profit improvements, business prospects and positioning with respect to market, demographic and pricing trends, strategic initiatives, re-engineering and outsourcing activities, new business results and outlook, changes in securities market prices, credit quality including reserve levels, planned capital expenditures and technology spending, anticipated tax benefits and expenses, and the effects of any extraordinary events and various other matters (including developments in litigation and regulation involving Northern Trust and changes in accounting policies, standards and interpretations) on Northern Trust’s business and results. These statements speak of Northern Trust’s plans, goals, targets, strategies, beliefs, and expectations, and refer to estimates or use similar terms. Actual results could differ materially from those indicated by these statements because the realization of those results is subject to many risks and uncertainties. Our 2006 financial annual report and periodic reports to the SEC contain information about specific factors that could cause actual results to differ, and you are urged to read them.