Northern Trust Corp. long has championed its conservative heritage as a 121-year-old financial institution that eased through the Great Depression and most recently the Great Recession.
But old dogs are learning new tricks, as Chicago's largest bank announced Tuesday the formation of a new practice to handle the wealth of lesbian, gay, bisexual and transgender households.
John McGowan, 52, a 13-year Northern veteran who most recently was a senior relationship manager serving high-net-worth individuals and family offices, was named national practice leader for the LGBT unit.
While numerous wealth management firms have lesbian and gay clients, Northern appears to be one of the few to have formalized a unit to serve that niche, according to industry experts.
The practice, which will focus in part on the complex estate and tax issues faced by same-sex domestic partners, has been operating on a pilot basis in Chicago for the last year and will be established soon in Northern's other big markets: Southern California and South Florida, Mr. McGowan said.
“We do believe the definition of family has evolved, and the legal definition has not kept pace,” Mr. McGowan said.
Examples include tax policies that make it more difficult for same-sex couples to transfer wealth from one partner to the other without incurring hefty gift and estate taxes. Married couples can transfer wealth to each other tax-free.
Mr. McGowan, who is openly gay, points out that Northern has offered benefits to same-sex couples for 13 years. That often surprises outsiders, who assume Northern's conservative financial principles translate into cultural conservatism.
“It does come as a bit of a surprise to people, and I'm happy to debunk their impressions,” he said. “I feel very proud and comfortable bringing this program to our front-line ranks and customers.”
Over time, it will be available in all 18 states in which Northern has branches.
Steve Daniels is a reporter with Crain's Chicago Business, an InvestmentNews sister publication, where this story originally appeared.