U. S. T RUST

M ARIBETH S. R AHE P resident U.S. T rust C orporation M ARIBETH S. R AHE P resident U.S. T rust C orporation

U.S.T RUST W HAT I S W EALTH M ANAGEMENT?  Synthesis of financial services for affluent individuals and their families  Relationship-oriented service  tailored to client’s objectives  designed to preserve and build multi-generational wealth  Related to, but distinct from  investment management  fiduciary services  private banking  financial, estate and tax planning

U.S.T RUST O UTLOOK F OR T HE A FFLUENT M ARKET  From 2000 to 2005, affluent households (net worth of $3 million, or adjusted gross income of $300,000) expected to grow 7% - 8% annual rate.  American households with $5+ million of investable assets have grown 25% since  Households with investable assets between $1 million - $5 million have grown 40% since  Investment management revenue from affluent households expected to grow from $25 billion to $45 billion between 2001 and  Less than half of $10 trillion held by U.S. households with $1+ million to invest is professionally managed.

U.S.T RUST T HE R USH TO W EALTH M ANAGEMENT  Who wants to enter the wealth market?  private banks  trust companies  retail banks  investment banks  full-service brokers  discount brokers  On average, it takes 18 to 24 months to gain a client.  Expertise in marketing and branding is essential.

U.S.T RUST C HANGING M ETHODS OF C LIENT A CQUISITION  Provider longevity a major factor in attracting and retaining new business  Source of wealth key to developing effective acquisition strategies  Need to be where wealth resides

U.S.T RUST H OW A FFLUENT C LIENTS H AVE C HANGED  More independent  More sophisticated  More demanding  Better informed  Validators want:  a partner in wealth management  control of decision-making process

U.S.T RUST E MERGENCE OF O PEN A RCHITECTURE  A real client benefit – and huge challenge for providers  Clients want convenience of one provider, without sacrificing product and service variety  Wealth management providers must supply full menu of offerings

U.S.T RUST T REND TO C ONSOLIDATION  Building from the ground up slow and costly process  Lift-outs  involves moving talent from an institutional operation  difficult approach  Mergers greatest growth opportunity for wealth providers today

U.S. T RUST: S UCCESSFUL G ROWTH T HROUGH A CQUISITIONS  15 acquisitions  Only national wealth management franchise in almost every affluent market U.S.T RUST

C RITICAL R OLE OF T ECHNOLOGY  Affluent Americans use the Internet to:  obtain financial advice  perform transactions  manage their accounts  review financial statements  Internet  increasingly valuable for meeting client needs  expanding into new segments of the market  raising overall level of service and accountability  Technology leverages professional expertise.  Massive investment

U.S.T RUST U.S. T RUST: T HE R EASONS FOR OUR S UCCESS  Staying power  U.S. Trust’s reputation  150 years in wealth management  a singular focus  U.S. Trust Survey of Affluent Americans highlights our position as leading expert on wealth management and the affluent  Value added  a profound understanding of clients  superb professional advice  Distribution: Maximizing our presence in every appropriate channel