New Business & Financial Results

1 PART ONE – Business Model Strategy 2 The Partnership 12 The Academy 17 Investment Management 19 Our Clients 31 Our Market 37 Cash & Dividend Profile 67 Our Shareholders 76 Analysts following 78 PART TWO – Financial Results

PART ONE Business Model

2 Strategy

3 St. James’s Place: Overview Leading UK Wealth Management Company –Established 1991 –UK listed with market cap of c. £4 billion –£44.3 billion in FUM –Target market £50k to £5 million free investable assets Differentiated business model –Provider and distributor –Own dedicated distribution – the Partnership –Distinct investment management approach Well positioned to benefit from long-term market growth –Favourable demographic trend –Increasing tax burden

Global Investment Management Expertise 4

5 Whole of Market approach We take responsibility for the due diligence on all the products and companies we make available to our clients.

6 Comprehensive range –of pension, investment and savings “wrappers” –of investment funds managed by global investment managers –access to “whole of market” for third party products and services e.g. protection and annuities Whilst avoiding –capital intensive products –guarantees and options –overly complex, fashionable or high risk structures Our products and services

7 The Growth Model Target: 15-20% pa NEW BUSINESS CAPACITY Number of Partners PRODUCTIVITY New business per Partner

8 Growing number of Partners +9 % +6 % +9.5% +8 % 1,958

9 Productivity (single investment per Partner) +2 % +28% +3% +12 % +5 % 3.83

10 Single premium gross investments

11 Funds under management 22 % p.a. compound growth over the last 5 years and 19% p.a. over last 10 years +20 % +25 % +29 % +18 % -10 % +31% +26% +6% % +27%

12 The Partnership

13 Dedicated distribution – the Partnership High quality self-employed team of c.2000 advisers –Average age is 48 –Above average productivity –90%+ per annum retention rate Aim to grow Partner number by 5% to 7% per annum Aim to increase productivity each year

14 Geographic distribution 31 December 2013

15 Partners by age band 31 December 2013 Existing Partners % 65+ 2% <35 6% % % New Partners % % 65+ 0% <35 20% %

Total adviser numbers down 18% 16

17

18 The Academy 60 new students in next generation Targeting another this year Anticipate c.50 to ‘graduate’ this year Plus a new regional initiative in Manchester

19 Investment Management

20 Our approach to investment management THE INVESTMENT COMMITTEE Appoint the Fund Managers Set performance objectives Risk management and strategy Decisions: Change firm? Change manager? No change? ‘MANAGES THE MANAGERS’ ‘INDEPENDENT EXPERTISE’ Vivian Bazalgette Sarah Bates Peter Dunscombe Win Robbins

21 Stamford Associates Independent Investment Consultancy Research Fund Manager Market Analyse & identify talented managers Gather intelligence Access to Whole Market Monitor Managers and Portfolios Qualitative and Quantitative Number crunching Monitor activity Behavioural psychology Workplace analysis Advise Investment Committee Focus on Future Outperformance Recommend: Potential changes New managers

Global Investment Management Expertise 22

23 Growth Portfolios

24 Growth Portfolios (cont.)

25 Income Portfolios

26 Funds under management 22 % p.a. compound growth over the last 5 years and 19% p.a. over last 10 years +20 % +25 % +29 % +18 % -10 % +31% +26% +6% % +27%

27 Below peer group average Above peer group average Weighted 5-year Rolling Performance to 31 December 2013 (excluding Money Market & Alternative Assets) Past performance is not indicative of future performance. The value of an investment with St. James’s Place can fall as well as rise. You may get back less than the amount invested.

28 Below peer group average Above peer group average Weighted 10-year Rolling Performance to 31 December 2013 (excluding Money Market & Alternative Assets) Past performance is not indicative of future performance. The value of an investment with St. James’s Place can fall as well as rise. You may get back less than the amount invested.

29 Funds Under Management: shown by Asset Class and Region 31 December 2013 UK 30% Property 2% PABs / FABs 2% Cash & Other Assets 10% European 11% US 19% Far East 9% Fixed Interest 14% Alternatives 3%

30 Benefits of investment management approach No in-house managers, so no conflict of interest Benefit from Investment Committee experience & expertise Ability to appoint the best fund managers with wholesale purchasing power Continuous monitoring plus quarterly reviews Easy to change manager – reduced churn Free switching for clients Significantly improved retention of funds

31 Our Clients

32 Geographic distribution of our clients 31 December ,000 clients Male 53% Female 47% Average age 53

33 Clients and FUM Clients by value band 31 December 2013 All clientsAll clients - FUM £250k- £500k 7% £1m+ 1% <£50k 54% £50k- £250k 36% £500k- £1m 2% £250k- £500k 21% £1m+ 16% <£50k 9% £50k- £250k 38% £500k- £1m 16%

34 New and retained clients by age band 31 December 2013 Existing clients by age bandNew clients by age band % <30 3% % % % % % % % <30 8% % % % % % %

35 What our clients think The key findings were: 84% * of clients highly satisfied with their relationship with St. James’s Place – nearly a third scoring us 10 out of 10 88% ** of clients ‘value’ a face-to-face relationship with their Partner 86% * of clients agreed that we provide excellent service 80% * of clients highly satisfied in the way in which we communicate with them 96% ** of clients were likely to recommend St. James’s Place to others 81% * of clients would invest with St. James’s Place again if making that decision today * Scoring 8 or more out of 10. Ledbury Research – November/December 2013 ** Wealth Account Survey, January 2014

Award winning into

37 Our Market

38 Our market The market is big Favourable demographics The tax burden is increasing UK high net worth individuals want face-to-face advice Limited access to advice as adviser numbers have reduced

Total adviser numbers down 18% 39

40 The SJP Marketplace UK individuals with between £50k and £5m of liquid assets Source: Datamonitor, 23 January 2014

41 The SJP Marketplace Amount of liquid assets held by UK individuals with between £50k and £5m Source: Datamonitor, 23 January 2014

42 UK Funds under management Funds £billion Private Clients £483 Property £142 Hedge £217 Corporate Pensions £1,597 Insurance Companies £994 Retail Clients £760 Private Equity £112 The City UK Fund Management report 2012 – figures relate to 31 December Insurance & Corporate Pensions relate to institutional clients.

2013 Rank 2012 Rank Company AUM end 2012 (£bn) Change v 2011 (£bn) Share (of top 40) 1st2ndCoutts (4%)10.9% 2nd1stBarclays (1%)10.6% 3rd6thSt. James’s Place Wealth Management44.3*9.5 (27%)*7.3%* 4th3rdUBS Wealth Management (3%)5.7% 5th8thBrewin Dolphin Limited (8%)5.5% 6th7thHargreaves Lansdown (8%)5.4% 7th4thHSBC (3%)5.2% 8th Rathbones (13%)3.5% 9th-Citi Private Bank % 10th Lloyds TSB Private Bank (10%)2.9% 14th JP Morgan Private Bank (19%)2.4% 27th25thTowry (6%)1.0% Top 10 Companies (6%)60% Top 40 Companies (9%)- Private Asset & Wealth Managers Top 10 and selected others 43 Source: 2013 PAM Directory*31/12/2013

44 Asia The Opportunity Singapore, Hong Kong and Shanghai Henley Group has 50 advisers with 4,000 clients and £430 million FUM Estimated 120,000 UK ex-pats with £12 billion of investible wealth (£100k each) Project to grow to over £20 billion by 2020 Our investment proposition and relationship based approach is well suited to this market

45 Partner Survey 2013 – Source of new business/markets 81% existing clients and referrals 7% introducers 12% new clients from other sources 27% of Partners experienced less competition in % acquired new clients due to decline of high street advice (banks)

The SJP Opportunity ISAs –Cash –Stocks & shares Building Society (Mutual Lender) deposits National Savings and Investment (NS&I) deposits Bank deposits Mutual funds £220 bn (Sept 2013 – HMRC) £223 bn (Sept 2013 – HMRC) £258 bn (Nov 2013 – Building Societies Association) £105 bn (Nov 2013 – Building Societies Association) £864 bn (Nov 2013 – Building Societies Association) £763 bn (Nov 2013 – IMA) 46

47 Advice Initial advice fee % of initial investment OR Hourly rate (£) Tiered fee based on amount invested + VAT Rate may depend on seniority of adviser Ongoing advice fee % of Funds Under Management OR Hourly rate (£) Tiered fee based on fund value Rate may depend on seniority of adviser Administration fee % of Funds Under Management OR Prescribed fees (£) Amount based on fund value Amount may depend on activity Platform / Admin Annual charge (%)Tiered fee based on fund value Account fee (£)Amount will depend on platform provider Transaction charge Prescribed fees OR % of transaction Amount per transaction Tiered fee based on transaction size Insurance Company Wrapper chargesAmount based on fund value Administration feeAmount will depend on insurance company Fund Management Annual Management charges (%) Amount based on value of funds under management Additional Miscellaneous Costs Amount based on value of funds under management The fees a client may have to consider when trying to compare advice and products based on publicly available information for a variety of firms and providers. The advice market – transparent?

Advisory/Discretionary ManagersTotal bps St. James’s Place (20yr holding period)195 Hargreaves PMS210 St. James’s Place (6yr holding period)219 Raymond James226 Brewin Dolphin Discretionary (fee only)231 Rathbones Discretionary278 Towry (6yr holding period)305 St. James’s Place (3yr holding period)312 Killik & Co Discretionary318 Barclays Wealth (3yr holding period)322 Towry (3yr holding period)330 Investec PMS349 Coutts (20yr holding period)350 Coutts (6yr holding period)362 Advisory/Discretionary Charge Comparison 48 Total Investment £85k UT/ISA £35k Pension £50k Source: Numis

Advisory/Discretionary managersTotal bps Raymond James180 St. James’s Place (20yr holding period)195 Rathbones Discretionary203 Hargreaves PMS210 St. James’s Place (6yr holding period)229 Brewin Dolphin Discretionary (fee only)231 Coutts (3yr holding period)235 Coutts (6yr holding period)247 Coutts (20yr holding period)263 Investec PMS275 Barclays Wealth (20yr holding period)275 Towry (6yr & 20yr holding period)282/299 Killik & Co Discretionary318 Advisory/Discretionary Charge Comparison 49 Total Investment £212k UT £100k ISA £12k Pension £100k Source: Numis

50 Summary Established and respected business Experienced and stable management team Experienced and stable advisory team – ‘The Partnership’ Proven track record of growth Resilient in tough markets Favourable demographics Award winning performance

PART TWO Financial Results

over %+46%+28%+15% 2011 over %+17%+13%-5% 2012 over %-2%+4%+43% 2013 over %+24% +9% Total new business by quarter APE (Annual premiums plus 10% of single premiums) £m

52 New business Total single investments of £7.2 billion – up 22% SJP new business on an APE basis of £762.9 million – up 20% Our own business represents 88% of the total Funds under management Net inflow of funds under management of £4.3 Billion – up 28% Continue to retain 95% year on year Funds under management of £44.3 billion – up 27% over the year

53 Partnership Partnership numbers 1,958 - up 9.5% Profits EEV new business profit £327.2 million – up 18% EEV operating profit £462.7 million – up 26% IFRS operating profit before shareholder tax £190.7 million – up 42% Other financials EEV net asset value of pence per share – up 25% Total cash result of £168.8 million – up 84% Full year dividend of pence – up 50%

54 Record single investments +26 % +13 % +11 % %

55 Consistent net inflow of funds under management +31 % +26 % +4% +10 % %

56 Funds under management 22%p.a. compound growth over the last 5 years % +26 % +10 % +22 % +27 %

57 Fund flow information £ billion31 Dec Dec 2012 FUM at start New money invested Investment return (Stock market fall) Regular income withdrawals/maturities (0.7) (0.7) Surrenders/part surrenders (1.8) (1.6) FUM at close Net inflow of FUM 4.30bn 3.35bn Implied surrender rate as % of 4.7% 4.9% average FUM

58 Five strong years of Partner recruitment +9 % +6 % +9.5% +8 % 1,958

59 Productivity (single investment per Partner) +2 % +28% +3% +12 % +5 % 3.83

60 Record EEV new business profit +26 % +40% +13% +16 % +13 % 327.2

61 Analysis of EEV life, pension & unit trust pre-tax operating profit £ million31 Dec Dec 2012 New business contribution Profits from existing business –expected –experience variance –operating assumption charges 4.6 (4.3) Investment income Operating profit

62 Pre-tax EEV profit £ million31 Dec Dec 2012 Life, pension & unit trust Distribution (6.1) 5.3 Other operations (27.7) (15.9) Total operating profit Investment variance Economic changes 10.6 (3.7) Pre-tax result

EEV operating profit +12 % +45% +12% +26% -2 % 462.7

64 Pre-tax IFRS profit before shareholder tax £ million 31 Dec Dec 2012 Life Unit Trust Distribution (6.1) 5.3 Other operations (27.7) (15.9) Profit before shareholder tax

65 Capital position as at 31 December 2013 Other £ million Life regulated Other Total Solvency position Solvency net assets Solvency requirement Solvency ratio 576% 227%

66 Group expenses £ million 31 Dec Dec 2012 Paid from policy margins Partner remuneration Investment expenses Third party administration Direct expenses Other new business related costs Establishment expenses Academy costs Other development costs Back office infrastructure costs Regulatory fees Regulatory change costs Contribution from third party product sales (20.4) (21.4)

67 Cash& Dividend Profile

68 Underlying post-tax cash arising from inforce business -3 % +15% +23% % +30%

Return on inforce Where product structure uses penalties the business is cash neutral in first six years 69 This relates to £13.2 billion of new business added in last six years which is not yet generating positive cash earnings * This amounts to £102 million of post-tax cash earnings per annum in future * * Ignores stock net movements and outflows Year£billion Total13.2 *

71 Underlying post-tax cash result New investments with surrender penalties £1.6bn £3.4bn £3.5bn £5.2bn £7.2bn £1.2bn £2.6bn £3.1bn £4.7bn £5.9bn

71 Underlying post-tax cash result Investment in new business

72 Post-tax new business cost (£m) * Post-tax EEV new business profit (£m) Margin (% of manufactured APE) IRR (net of tax) Cash payback period As % of gross inflows of FUM 31 Dec Dec 2012 (52.3) (60.5) % 43.4% 28.4% 22.5% 4 years 0.8% 1.1% Investment in new business *2013 – includes negative £4 million variance

73 Underlying post-tax cash result +67% Investment in new business

74 Continual dividend growth +16 % +18% +2% +33% +2.5% +33% * %

75 Outlook Familiar and well respected brand/business Loyal client base (Partners and investors) Consistent strong recruitment Resilient Investment Management Approach Strong solvency position Strong market for advice Favourable market place Uniquely placed business

76 Our Shareholders

77 Our shareholders 1.Threadneedle 5.28% 2.Baillie Gifford 4.99% 3.M&G 4.07% 4.Kames Capital 3.68% 5.AXA Framlington 3.41% 6.Legal & General 3.09% 7.Schroder 2.74% 8.Old Mutual 2.67% 9.BlackRock (BGI) 2.24% 10.Wellington 1.90% As at 30 December 2013

78 Analysts following

79 Analyst following Alan Devlin - Barclays Capital Matthew Preston - Berenberg Andrew Sinclair - BoA Merrill Lynch Chris Esson - Credit Suisse Oliver Steel - Deutsche Bank Ravi Tanna - Goldman Sachs Ashik Musaddi - JP Morgan Cazenove Greig Paterson - KBW Neil Welch - Macquarie Jon Hocking - Morgan Stanley Ben Bathurst - Nomura David McCann - Numis Marcus Barnard - Oriel Securities Barrie Cornes - Panmure Gordon Stuart Duncan - Peel Hunt Paul De’ath - RBC Capital Markets Eamon Flanagan - Shore Capital

28 February 2013