REFILE-UPDATE 1-Northern Trust sees $328 mln charge on fund move
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NEW YORK, Sept 29 (Reuters) - Northern Trust Corp (NTRS.O) said it will take a charge of $328 million against third-quarter earnings as a result of moves to make sure investors in its money-market funds don't lose cash.
The fund company said that in a move that will cost it $290 million in pre-tax charges, it will make sure all of its funds maintain a stable net asset value of $1 -- assets of at least $1 for every dollar invested.
Money market funds are usually considered safe investments, but net asset values have come under pressure as panicked investors have pulled out their money. Some funds have fallen below a net asset value of $1 -- known as breaking the buck -- in recent weeks.
Northern Trust, a Chicago-based asset manager with $751.4 billion under management, also said it will provide support to securities-lending clients that have cash collateral invested in certain of its funds that have been affected by the credit crisis.
It is also buying back certain illiquid auction rate securities. Regulators have been investigating how such securities were marketed and whether investors were misled into believing the instruments were as liquid as cash.
In total, these actions will cost Northern Trust $328 million after taxes, or $1.46 per share, in the third quarter. (Reporting by Elinor Comlay; editing by John Wallace)
