Company moved to action by Las Vegas' growth

Northern Trust, a financial service company that dates back to 1889, could not ignore the growth and potential Las Vegas exemplified. For five years it watched the continual growth of the city and in May 2000 opened a branch at 7251 W. Lake Mead Blvd., its first in Nevada.

"There had been a few green lights all along that Las Vegas could support an office," said Pam Newell, vice president of private client services. "We saw tremendous growth, people moving here from California who were downsizing and (because of the real estate market there) had sizable liquid assets to invest."

The majority of Northern's business involves trust, retirement and investment management. Its umbrella of services also includes venture capital, corporate and institutional programs.

Individual investors range from having $1 million to hundreds of millions to invest. Nationwide, there are about 300 family estates or trusts that deal in the higher end of that scale and Northern represents 30 percent of them, an amount 20 percent larger than its nearest competitor. In Nevada, Newell said, there are only a handful of estates with $100 million or more to invest. The retirement population makes up a large part of its Las Vegas client list, one reason why the company opted to be in the Summerlin area.

Each quarter Northern meets with its investors, their CPA and attorney. Portfolios are managed on a daily basis by the portfolio manager and Northern's analysts religiously tracking various sectors. Most clients have 40 to 60 stocks in their portfolios. To help keep clients informed, the company holds quarterly conference calls, presided over by its chief investment officer. Nationally, as many as 400 people listen to the conference call, with another 200 people accessing the taped version later. In Las Vegas, it regularly offers speakers like estate planning attorneys and certified public accountants.

Northern Trusts' philosophy, Newell said, is steady growth, and it is constantly analyzing markets, following trends and staying on top of a variety of economic factors. Such dedicated watchdog tactics allowed Northern an advantage when indicators hinted at problems with California's utility industry.

"Our analysts closely followed the utility industry and the effect of California's energy crisis on our client's stock and bond holdings," said Pat Everett, managing director. "Our analysts actively recommended which securities to hold and which to sell."

Similarly, when dot-com companies began to tumble, Northern was already reducing the exposure to technology stocks, moving its investments before the NASDAQ index reached its high of about 5100 in March 2000. Newell said equity portfolios still had some losses in 2000 ("We were down like everybody else.") but it endured losses of 8.4 percent, compared to the Standard & Poor's suffered more -- 8.9 percent.

Northern strives to outperform the benchmark set for a given client. The company keeps track of about 10,000 stocks and looks at everything from growth in earnings and revenue to long term debt levels.

Emerging businesses are concentrated in technology sectors, especially computers, an area Northern sees as still evolving.

Even with downturns in sectors of the economy, a portfolio can make up losses by investing when the market is down and selling once stock prices rise again.

"At the current time we're encouraging clients to increase their equity exposure as the return potential appears attractive when compared to the downside risk over the long-term," Everett said. "We are also encouraging our clients to overweight technology companies in their portfolio."

Las Vegas is such a promising area, Northern is constructing a 12,000 square foot building at Town Center Circle which should be occupied by April. In three to five years, it expects to open a branch in Green Valley and one in Reno.

Doug Christensen, portfolio manager, said the company keeps its eye on gaming stocks and has been known to invest in them for long-term growth.

The company has a client base that spans the globe and has nearly 90 offices in the United States and abroad. It has more than $338 billion in assets under management. The Las Vegas office is headed by Patrick Everett. Although it is a large corporation, it still prides itself on being a hands-on company, doing the little things clients appreciate.

A case in point is an elderly widow who had to travel from Florida to Connecticut and was apprehensive about going alone. Northern Trust provided her with a cell phone so she could stay in contact with her family.

"It's things like that, that set us apart," Newell said.