Bank hurt by Enron loans

Monday, Jan. 14, 2002 | 11:03 a.m.

Northern Trust Corp. of Chicago said its fourth-quarter profit fell 18 percent after the fourth-biggest bank in Illinois wrote off loans it made to bankrupt energy trader Enron Corp.

Net income fell to $102.4 million, or 45 cents a share, from $125.5 million, or 54 cents, a year earlier.

Chicago-based Northern Trust said it wrote off $41.5 million of bad loans, more than half of which were related to Enron, which filed for bankruptcy protection last month. The bank said it had loaned a total of $43.5 million to the energy trader, $24.5 million of which wasn't backed by collateral.

Northern Trust set aside $45 million in the fourth quarter to cover the possibility of further bad loans. Enron, once the biggest trader of energy, owes banks and other creditors $31.2 billion.

Northern Trust entered the Las Vegas market in 2000 with one branch and plans to expand.

Northern Trust's revenue was $550 million in the quarter, almost unchanged from $549.7 million a year earlier.

Revenue from holding customer assets in trust, the company's biggest business, was $304.1 million, compared with $304.9 million a year ago.