Financial Markets - Credit MarketsNiall Cameron, MD - Global Head of Credit Markets VC

11December 2003

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All Credit products are now under one roof...

Our differentiated product offering in …

Loan Markets

Debt Capital Markets

Asset Securitisation

Structured Capital

Emerging Markets

Project Finance

Credit Trading

...Allows us to provide a competitively advantaged client offering under one roof, e.g

Cross sell maximisation

One CDO group

Combined product pitches

Single execution points

Combined credit trading desks

FMA links products for solutions

Headcount efficiency

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…..With a greater focus on clients….

Best in class approach by

individual product groups

Product groups seamlessly

integrated with client coverage

Products linked to provide

clients with one-stop solutions

FMA group provides share of

mind advice and solutions

Client service differentiation

through product innovation

Client vs. non-client revenue

Sept ytd 2003

Trading revenue

8%

Client revenue

78%

Conduit revenue

14%

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…. The results of which have led to improved performance…..

Regional revenue breakdown

Significant increase in

revenues in 2003

Headcount neutral

Decreased direct costs (2%)

Significant revenue increase in

2004 targeted

Western Europe

61%

LatAm1%

CEMA1%

Australia/NZ6%

North America26%

Asia5%

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The changes made in 2003 will further improve our positioning...

Loan Products / GFM Merger

Introduction of FMA

Establishment of “Sterling plc”

Development of Credit Index (iBoxx) products

Market leading position in Covered Bonds

Execution of US Growth plan (Part I)

Reinvigorated Emerging Markets

Leading position in Infrastructure Capital Australia

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…. Resulting in an improved market share

Sources: SDC Platinum/IFR; Dealogic/Euroweek

Our ranking for key products and market share continues to improve

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Complete trading suit

Complete Loan/DCM offer

Increase focus on two major

markets

Higher client service level

Initiatives Comments

Enhancing our Mature Credit Market Businesses

Emerging Markets CDS

Build out MTN Platform

ABS UK / Italy

Cash Trading growth

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Building Material New Growth Spikes

Structured Credit Derivatives

/CDO

Infrastructure Capital Europe

High Yield Europe

Develop top-tier client position

and deliver enhanced credit

index and structured product

range

Replicate success in Australian

market in selected European

markets

Complement leveraged finance

business with select high-yield

offering

Initiatives Comments