Danny Burton

Head of Dealing

2Threadneedle – Global Presence

Source: Threadneedle as at August 2009

Offices

Swindon

Brisbane

Hong Kong

Singapore

LondonCopenhagen

Paris

Madrid

Milan

Frankfurt

Amsterdam

ViennaZurichGeneva

3Threadneedle - who we are

Focus: Threadneedle’s only business is asset management

Over US$85 billion in assets under management*

Employing 550 full time staff members, over 120 of whom are investment professionals*

Global: Our business is global, serving a wide range of institutional, wholesale and private investors

Global coverage spanning US, Europe, Asia and Middle East

Local offices in 12 countries

High Alpha: We are a high alpha manager with capabilities across a wide range of asset classes

69% of our funds are in the top 2 quartiles over 1 year^

88% of our funds are in the top 2 quartiles over 3 years^

Financial Strength: We enjoy the support of a strong and well-capitalised parent

Ameriprise Financial Inc. has an ‘A’ debt rating from S&P*As at 31st July 2009^Source: Morningstar, 31 July 2009

4Dealing desk structure

Team of six dealers

Two dedicated UK equity dealers

Two dedicated European dealers

Two International Dealers

Desk coverage from 6am to 10pm

Contactable outside of office hours

5Threadneedle

The team are responsible for an average of 7,000 transactions per month

We work closely with the portfolio managers to translate their investment ideas into trading strategies.

- We do not assume an order is generated in response to a prevailing market price

Each order is assessed and will be traded individually, as a program, in an algorithm, on a crossing network or within various dark pools

The preferred large trade option is always to match liquidity with one of our approved brokers on a full, execution only or CSA commission basis

6We need scalable trading solutions

With ever increasing dealing volumes and continued market volatility the desk needs ways to manage low touch orders. The solutions need to allow the dealers to concentrate on the difficult orders that require more management

Program trading allows the low touch management of multiple orders

Algorithms provide a low touch solution with various levels of control Crossing networks allow low impact trading opportunities with prior knowledge of potential to trade

Dark pools allow low impact crossing opportunities without any guarantee of trading All give the dealer the ability to trade at lower commission rates

7Current split of low touch orders

Threadneedle dealers currently trade around 45% of all orders using a low touch, low commission method

Program trading is 22% of total trades

Algorithms are 19%

Crossing networks 3%

Dark pools 1%

Dark pools will be utilised by program trading desks and most algorithms will source liquidity within the pools too.

Therefore the amount of Threadneedle business traded in a dark pools will be much greater. We estimate it could be as high as 35 – 40% of all low touch orders.

8When we use a dark pool

Want to trade in an illiquid stock and there are no adverts

Want to trade in a stock with many indications of interest but do not want to alert the market of our intentions

Want to cross stock while working an order in the market

Want to trade at a lower commission rate

We only trade through broker dark pool algorithms - need to be sure to tap all pools - smart order routing is essential - anti gaming technology

9The negatives – our observations

The problems we encounter with dark pools are:

No certainty of execution Prefer not sharing liquidity No idea what size of order we are facing Opportunity missed to search for liquidity or to trade Not always convinced it is totally dark Can detract from taking a market view Unexecuted trades need closer management - price levels, market volume, natural business and the dealer may not want to leave a balance Unable to give the portfolio manager any indication of the potential to trade again The other side trade their balance to suit their cross

10Our conclusion

We believe that dark pools do have a space in our trading process

We do not think they will ever get to take enough market share to confuse price referencing

Without smart order routing we would choose one dark pool

We still see value in traditional trading methods where we retain the ability to source liquidity for Threadneedle funds alone

We are confident that our brokers show discretion with our orders and we retain the leverage to resolve any issues