Bank of New York Mellon Corp. approached Northern Trust Corp. last week to express interest in a possible merger in what would be a megadeal for the U.S. financial services industry, the Wall Street Journal reported.
The chief executives of the banks had at least one conversation, the Journal said Sunday, citing people it didn’t identify, though the firms didn’t discuss a specific offer.
Shares in Northern Trust rose as much as 5.5% in premarket trading on Monday.
A representative for BNY declined to comment. Representatives for Chicago-based Northern Trust didn’t immediately return a request for comment placed outside regular business hours.
BNY is considering its next steps, including making a formal bid, the Journal said.
A tie-up would bring together two of the largest custodian banks in the world. Northern Trust had a market value of more than $21 billion at Friday’s close while BNY’s is above $65 billion.
Both firms offer services including custody of client assets, wealth and asset management and other banking business. BNY, founded by Alexander Hamilton in 1784, says it’s the world’s largest custody bank, with such assets surpassing $53 trillion as of the end of March.
The combined entity’s scale — including an estimated $3 trillion of assets under management — would help it compete with global asset managers like BlackRock Inc. and Vanguard, RBC analysts said in a research note.
Consolidating technology platforms, reducing headcount and real estate footprints could help cut Northern Trust’s expenses by 20% to 30%, the analysts estimated.
Under Chief Executive Officer Robin Vince, BNY has been in the midst of an overhaul aimed at cutting costs and streamlining the institution, as well as focusing on higher-margin businesses.
Shares in the bank, which says it touches nearly 20% of the world’s investable assets, are up about 19% so far this year.
Northern Trust’s share price has also climbed, trading up about 9% so far in 2025 through last week, compared with a 3.9% rise in an S&P 500 Financials Sector index.
Some analysts and executives have said they’re optimistic more deals will win approval under President Donald Trump’s administration. Earlier this year, Capital One Financial Corp. received approval from U.S. regulators to buy Discover Financial Services in a deal creating the nation’s biggest credit-card issuer by loan volume.
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