David Oliphant, Executive Director

Succeeding in a radically different Fixed Income environment

November 2011

The sovereign health checkCritical condition diagnosed for some, overblown concern for others

Interest cover & reliance on external financing

* Based on 2010 figures: Source: Eurostat and IMF Fiscal Monitor** Based on 2011 Government Budget Balance Estimates: Source: IMF

PT/11/00506

Fiscal Balance & Debt as % of GDP

Source: Threadneedle, IMF Fiscal Monitor April 2011 and Haver Analytics as at 30 April 2011

2

PhilippinesMalaysia

Indonesia

India

China

South Africa

IsraelTurkey

Russia

Romania

Hungary

Poland

MexicoBrazil

Italy

Ireland

PortugalSpain

Greece

Germany

Japan

UK

US-12%

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

0% 50% 100% 150% 200% 250%

Government debt (% of GDP)

Fisc

al b

alan

ce (%

of G

DP)

.

Developing economies Developed economies

Greece

Italy

Portugal

Ireland

Belgium

UK

France

Austria

Germany

Netherlands

USSpain

Japan0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

0% 1% 2% 3% 4% 5% 6% 7%Interest payments as % of GDP2

% o

f gov

ernm

ent d

ebt h

eld

exte

rnal

ly1

What is the cure? Pick your poisonSolving the problem of excessive debt

Solution Does it work?Impact on

Sovereign Bond Prices

Impact on Risky Asset Prices

Borrow more to boost growth! Perhaps as an early policy response, but no longer a viable option Lower Higher

Default / Restructure debt NO, but might be the only option for some Lower Lower

Reduce debt load through austerity programs

Probably, but is unproven for large economies with highly levered private and financial sectors

Higher Lower

Renege on promises to local constituencies (pensions, social support programs)

YES, and much more to come Higher Higher

Re-finance debt through higher savings

YES, but at the expense of slow growth and inefficient allocation of capital Higher Lower

Print money & devalue currency YES, provided inflation is kept under control Uncertain Higher (in local currency)

Inflate your way out of the problem

NO, unless one can continuously surprise the markets Lower Lower

Estimates of likely impact assume other factors remain unchanged

3PT/11/00506

Source: Capital Economics as at September 2011

Interest rates are establishing record lows, but is there still room to rally?Long rates have caught up to ultra-low short rates

Source: Capital Economics as at September 2011

4PT/11/00506

5

US – fiscal deterioration not priced in

Source: IMF, JPMorgan, Threadneedle , August 2011

EM– fiscal improvement not priced in

Source: IMF, JPMorgan, Threadneedle , August 2011

0

2

4

6

8

10

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011F30

35

40

45

50

Govt debt (% GDP, rhs) EMBIG Index spread (%, lhs)

GBI-EM Global yield (%, lhs)

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011F40

50

60

70

80

90

100

110

Govt debt (% GDP, rhs) US 10y yield (%, lhs)

Emerging markets still appear attractiveRelative debt sustainability metrics are heavily tilted in EM’s favour

PT/11/00506

Corporate market fundamentalsCompanies are in relatively good shape

Header & Footer – update footer reference

European IG issuer leverage(based on ~170 credits)

Source: Morgan Stanley Research, Markit iBoxx

6

Investment Grade deleveraging continues to remove bonds from the market

Corporates are in considerably better financial health than in credit crunch (2008-09)

Uncertainty (political, economic) seems to have made companies more cautious than otherwise

Very high marginal cost of funding for banks (unsecured) has made bank lending far less attractive

Source: Morgan Stanley, October 2011

The Debt-Equity Clock

4 3

21

The Debt - Equity cycleCorporate Leverage is low and not yet rising?

PT/11/00506 7

Corporate Leverage fallingREPAIR2H08 onwardsBalance sheet repair, rights issues to pay back debt, focus on cash generation and survival!

Credit better than equity

Higher Economic growthLower Economic growth

Corporate Leverage rising

RECOVERY2H 2009 - ?

Restructuring efforts boost cashflow. Margins rising, FCF growing, leverage falling

Both equity and credit up

EXPANSION2006-07

Margins peak, leverage rising, FCF falling, volatilityrising, M&A/LBOs more speculative. Credit bearmarket starts, equities still in bull market

Equity better than Credit

DOWNTURN2H07, 1H08Recession. Attempts to delever foiled by falling asset prices. Continued bear market for credit. Equities enter bear market

Both Equity and Credit Down

Corporate bond valuationsCorporate market pessimism is very high

The € CDS credit market is implying a very highlevel of Investment Grade defaults in thecoming years

At current spread of around 170, European Creditmarket is discounting 14% cumulative defaultprobability (on a 40% recovery assumption).

Itraxx Main Index is a basket of 100 Corporateand 25 Senior Financial issuers

Historic experience has been far less than this

Average 5-year default experience is 0.8%

Worst cohort exhibited 2.4% in last 40 years

‘Great Depression’ estimated at around 5%

PT/11/00506 8

Implied investment grade defaults

Current iTraxx Main Index 170

Assumed recovery rate 40% 20%

5-year assumed default rate 13.7% 9.3%

Source: Bloomberg as at 4 November 2011

5-year cumulative default rate history

Corporate bond valuationsHistorical experience is very different

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Cum

ulat

ive

defa

ult r

ate

PT/11/00506

Source: JP Morgan as at June 2010

9

Default rate vs. high yield bond spread

Source: Credit Suisse, JP Morgan August 2011

High yield market pessimismDefault rate vs. spread to worst

0%

2%

4%

6%

8%

10%

12%

14%

16%

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Default Rate (LHS) US Spread (RHS) Europe Spread (RHS)

10PT/11/00506

Bond market outlookIs there any value left in Fixed Income markets?

PT/11/00506 11

Source Bloomberg – 4th November 2011

10-year Government Bond Yields

Source: Bloomberg 4 November 2011

0

5

10

15

20

25

30

Oct-06 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11

Japan Germany USA Italy Greece

Euro High Yield & Corporate Bond Spreads

Source: Merrill Lynch 4 November 2011

0

500

1000

1500

2000

2500

Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Jun-110

50

100

150

200

250

300

350

400

450

500

Euro high yield Euro IG (RHS)

Eurozone Corporate Bond Spreads and Volatility

Source: Merrill Lynch 4 November 2011

Refine your risk frameworkRisk is about losing money, not statistics

PT/11/00506 12

At which point is your money more at risk? At which point is there more opportunity?

0

50

100

150

200

250

300

350

400

450

500

03/07/97 03/20/1998 04/09/99 04/07/00 04/20/2001 04/26/2002 05/02/03 05/07/04 05/20/2005 05/26/2006 06/01/07 06/06/08 06/12/09 07/02/10 07/08/110

10

20

30

40

50

60

70

80

90

Spread (LHS) Standard Deviation (RHS)

Volatility Yield Premium

Here?

Here?

Threadneedle Global Opportunities Bond Fund

Please note this fund is currently only registered in Luxembourg, the Netherlands and Switzerland. It may therefore not be offered to the public in any other country. The information contained in this presentation is strictly for your internal use only and must not be passed on to any third party.The registration process for other countries is currently underway.

Our proposition

Threadneedle (Lux) Global Opportunities Bond Fund

An unconstrained, diversified, high conviction investment approach employing a wide variety of strategies

Target return of 1 Month USD LIBOR + 4.5% (gross of fees)

By investing in bonds, currency and derivatives

Designed to adapt to different phases of the economic cycle

Aims to deliver a positive return over any 12 month period irrespective of market conditions

Invests in best ideas generated by Threadneedle’s highly experienced specialist fixed income team

PT/11/00506 14

A ‘go anywhere’ fixed income portfolio aiming for positive returns in all markets

Implications for InvestorsBroaden the opportunity set, think across borders

PT/11/00506 15

Cash (Libor)

Designed to minimise exposure to interest rates

Term (Libor)

Has interest rate risk but no defined risk/sector exposures

Traditional

Comprised of multiple securities with varying exposure to interest rates

Benchmark – ‘Beta’

Performance unconstrained by benchmark beta

Product suitable for all market conditions

Risk controlled to suit performance target

Total return

Duration

Yield Curve

Geography

Currency

Asset Allocation

Security selection

(IG, HY, EM, Sovereign)

Opportunity Set – ‘Alpha’

++ ==

Fixed income sectors £20.8 billion

Source: Threadneedle as at 30 June 2011

Threadneedle’s fixed income credentials

A leader in fixed income

Focused on innovation and client solutions

Research led, using fundamental, structural and valuation analysis

Deep resource

Complementary strengths covering all major fixed income markets

Dedicated risk management team

Culture of collaboration and communication

Entire team participates in idea generation, discussion and debate

Source: Threadneedle as at 30 June 2011AUM exclude externally managed funds under administration

PT/11/00506 16

Government33.5%

Investment grade28.1%

EMD in Hedge6.2%

ABS8.9%

ARB4.3%

HY inc Credit Opps15.2%

Treasury3.0%

Team approach gives information advantage

Threadneedle Global Opportunities Bond FundPortfolio Construction Team

Source: Threadneedle as at 30 June 2011

Head of Fixed Income

James CielinskiLead portfolio manager28 years experience

Emerging Market £1.4bn AUM

Richard HouseStrategy Head17 years experience

Asset Backed £2.1bn AUM

Henry CookeStrategy Head25 years experience

Government & FX £7.7bn AUM

Quentin FitzsimmonsStrategy Head20 years experience

Manages the allocation of the risk budget

Manage individual strategies within the fund

17

Investment Grade £6.4bn AUM

David OliphantStrategy Head22 years experience

High Yield £3.5bn AUM

Barrie WhitmanStrategy Head24 years experience

PT/11/00506

Drawing on the best ideas from across the group

Fixed Income TeamExperienced teams across all asset sectors

18

Credit

Investment Grade

David Oliphant

Simon Bond

Alasdair Ross

David Morgan

Paul Smillie

Jonathan Pitkänen

Arabella Duckworth

Mindaugas Lepeska

High Yield

Barrie Whitman

Michael Poole

David Backhouse

Jeff Mueller

Jenny Wong

Gareth Simmons

Craig Nicol

Investment Specialists

Mark Baker

Alexander Batten

Macro

Government and FX

Quentin Fitzsimmons

Dave Chappell

Martin Harvey

Richard Stevens

Matt Rees

Matthew Cobon

Emerging Market Debt

Richard House

Henry Stipp

Agnès Belaisch

Nicolas Jaquier

Commodities

David Donora

Daniel Belchers

Nicolas Robin

Securitised

Mortgage & Asset Backed Products

Henry Cooke

Ashley Burtenshaw

Sergey Podzarov

Steven Fleming

Shane Stanton

Michael Groom

Liquidity Markets

Treasury & Dealing

Emma Photis

Sarah Kendrick

Cindy Larke

Paul Witchalls

Gabriel Heskin

Mandy Coatsworth

Jim CielinskiHead of Fixed Income

Source: Threadneedle as at 31 August 2011

PT/11/00506

Threadneedle’s approach to fixed income

Idea generation

Research

Portfolio construction

Risk management

To deliver results we strive to be outstanding in each of these key

interlocking areas

Expertise must evolve with the markets

PT/11/00506 19

Threadneedle’s investment approach

Incorporates multiple sources of return

Specialist fixed income teams generate best ideas

Asset allocation across all asset types

Global Opportunity Bond Fund

Currency

Interest rate duration

Country / yield curve

Investment grade

ABS / Mortgages

High yield

Emergingmarkets

Short duration carry

strategies

PT/11/00506 20

Fixed income research

21

Apply common scenario framework

Identify individual assets

Formulate scenarios (eg. Eurozone crisis,

Middle East, global QE)

Stress test widely varying assets to similar

scenarios

Score assets by risk-adjusted returns

Asset allocation Fundamental Structural Valuation Overall

score

Govt.bond +1 -1 0 -1

Investment grade 0 0 +1 +1

High yield +1 0 +1 +1

EM credit +2 +1 0 +2

EM local currency +1 -2 +1 0

ABS -1 0 +2 +1

Source: Threadneedle as at 30 June 2011Scale: -2 (max underweight) to +2 (max overweight)

Rel

ativ

e to

risk

free

PT/11/00506

A diversified yet high conviction approach

Portfolio construction

Target –1-month USD Deposit Rate

plus 4.5% (gross of fees)

Core portfolio

Overlay portfolio

+Weightings can vary significantly reflecting market outlook

Achieving alpha through currency and derivatives

Arbitrage, Relative Value and Directional strategies

Hedging of unwanted portfolio risk

High quality securities of 0–3 years’ duration

Cash, deposits, sovereign and quasi-sovereign debt, corporate bonds and AAA asset and mortgage backed securities

22PT/11/00506

Risk management

Estimated contribution to total portfolio risk*

Diversification of strategies is paramount to the process

Attractiveness of strategies will vary over the cycle

No single strategy will overwhelm the other portfolio risk balance

Rates20%

Asset class allocation

13%

Security selection (HY,

IG, EM, Sovereign,

ABS)34%

Currency13%

Carry (HQ short

duration)20%

*over a full investment cycle

23PT/11/00506

Diversification is critical for our process

Threadneedle Absolute Return Product Range

Global Opportunities BondFund Target Return Fund Credit Opportunities Bond

FundAbsolute Emerging Markets

Macro Fund

Benchmark 1M $ LIBOR 3M Euribor 1M EURIBOR 3M $ LIBOR

Performanceobjective BM +4.5% gross BM +3.0% gross BM +3.5% gross 7.5%–12.5% net

Asset class focus Diversified global Macro, DevelopedGovernments, Rates, FX

Credit – Investment Grade and High Yield

Emerging market sovereign, local and international

currency and FX

Launch date August 2011 April 2006 May 2009 September 2010

Relative performance since inception +0.59% +2.20% p.a. +5.97% p.a. -2.00% p.a.

24PT/11/00506

Source: Threadneedle as at 30 September 2011

Investment process in action

PT/11/00506 25

Strategy and positioning (relative to risk free rate) Threadneedle view Risks to our view

Duration (10-year) Favour curve flatteners in US, UK & Core Europe

Significant risks to global growth outlook remain

Italy key & in focus with yields potentially heading to 7% and Berlusconi under pressure

BTP and DAX futures are barometers for risk on/off

Short term Euro ‘bazooka’

Internationally co-ordinated monetisation

An upside surprise in economic data

Money printing causes curve to steepen

International agreement to regulate FX markets and/or behaviour in markets

Currency Long USD vs. JPY,CHF,EUR,GBP,AUD

Long Asian FX vs. European FX on structural need for appreciation

CHF the most expensive currency in the world

Long EUR vs. SEK

Shirt USD vs. MXN, short AUD vs. Chilean Peso

EM central bank diversification into £ and € inflates values

Credible fiscal steps in Japan boosts JPY

Positioning unwinds in Asia

USD sell off following rating downgrade

Emerging Markets Local (rates and currency)

Received in selective short end rates

Neutral FX given macro uncertainty

Short term bouts of risk aversion

Policy mistakes

Emerging Markets Sovereign Credit (USD denominated)

Attractive risk/return profile

Solid credit fundamentals

Spreads have widened creating a buying opportunity

Significant slowdown in external demand

Investment Grade Corp Although tail risk remains elevated, spreads exhibiting considerable value against macro outlook and balance sheet fundamentals

Some evidence of retail and institutional inflows given low gilt yields and volatility elsewhere.

Eurozone problems produce bank/financial contagion

Spreads already very tight if viewed against local government yields rather than Bunds

High Yield Corporate Spreads wide vs. default rates, which will remain low

Inherently low interest rate duration

Demand for income in a low growth world

Developed market growth < 1.5% (recession fears)

Risk of forced selling on asset class outflows

ABS / MBS Outsized liquidity premiums persist

Will benefit from low rates and demand for income

Attractive levels of credit enhancement

Sharp deterioration in property values

Outperformed senior financials over past two months – expect that continue in near term

Commodities Continued negative macro forces slowing global industrial demand

China now neutral but slowing

European crisis

Financial crisis

China credit crisis

€¥ £$

-2 -1 0 +1 +2Short Long

Summary

Why Threadneedle for unconstrained absolute return fixed income

A global ‘go anywhere’ bond fund designed to succeed in a radically different fixed income environment

Aims to achieve attractive returns while taking an acceptable level of risk - targets a return of 1 month USD LIBOR + 4.5% (gross of fees)

Bringing together the best ideas from across Threadneedle’s extensive and experienced bond team

Proven investment philosophy and process

Extremely strong track record across the fixed income universe

PT/11/00506 26

Meeting the challenges of today’s fixed income markets

Threadneedle Global Opportunities Bond Fund

Cumulative performance (%) September 2011

Since Inception

Threadneedle Global Opportunities Bond Fund (Gross)

0.61 0.77

USD Libor 3 Month 0.02 0.02

Geometric relative return +0.59 +0.75

27

Cumulative performance (%) September 2011

Since Inception

Threadneedle Global Opportunities Bond Fund (Net)

0.47 0.60

GIFS Offshore Alternative Long Short Debt -6.77 -6.82

Geometric relative return +7.76 +7.97

Fund performance is based on official Global Close prices. All returns include gross reinvested income and fund returns are gross of TER. All prices are calculated by the fund's administrators Dexia. Inception date 24.08.11.

Fund returns are calculated using official global close prices as calculated by the fund's administrator Dexia. All performance is quoted in USD Terms. Source Morningstar. Inception date 24.08.11.

PT/11/00506

Appendix

AP

Threadneedle Global Opportunities Bond Fund Fund details

Fund Manager Jim Cielinski (Lead Portfolio Manager)

Launch date 24 August 2011

Objective The Fund seeks to achieve an absolute return over a 12 month time horizon1

Target tracking error 500-600bps tracking error over a market cycle

Performance benchmark 1 month USD LIBOR + 4.5% (gross of fees)

Dealing Daily

Legal structure SICAV (Luxembourg-domiciled)

Fees 0.65%, 15% performance fee over the performance benchmark (with high water mark)

No. of positions Typically 75 to 125 holdings (long and short)

Gross exposure Typically between 175% and 400% (longs + shorts)

Net exposure Typically between -50% and +175% (longs - shorts)

Instruments Long / Short: Cash fixed income instruments, futures, swaps, options

Currency USD, EUR-hedged, GBP-hedged, CHF-hedged,

1 Investors should note that the fund does not offer any form of guarantee with respect to investment performance and no form of capital protection will apply2 Aggregate of management fee and shareholder servicing fee

PT/11/00506 29

Careful management of risk budget

Risk budget ensures diversification and assist sizing of trades

Attractiveness of sources of return will vary over time

Fund is designed not to rely excessively on any one strategy

Representative risk budget

Strategy Target risk(tracking error)

Expected return (Above Libor)

Interest ratesDuration & yield curve 1.00% 0.30%Country selection 0.80% 0.32%

Currency 0.90% 0.54%Asset class allocation

Strategic (short duration) 1.70% 1.19%Cross-asset class 1.10% 0.39%

Security selectionOECD sovereign 0.60% 0.30%Emerging market 0.75% 0.45%High yield 0.75% 0.45%Investment grade corporate 0.60% 0.36%Securitised (ABS/MBS) 0.75% 0.45%

Total 6.10% 4.75%

PT/11/00506 30

Global Opportunities Bond Fund

Avoids and/or hedges out unquantifiable tail risk and helps lessen impact of shocks

Offers a global approach to finding the best risk-reward across asset classes

Has considerable flexibility in taking and managing interest rate exposure

Targets a return of 1 month USD LIBOR+ 4.5% (gross of fees)

Market concerns

Policy risk is unpredictable and often impossible to analyse

Asset class labels no longer characterise risk-return

When rates are low capital returns are threatened by rising yields

Achieving attractive returns with an acceptable level of risk

Threadneedle (Lux) Global Opportunities Bond FundAn unconstrained fixed income solution to address investor concerns

Aims to deliver a positive return over any 12 month period

PT/11/00506 31

Threadneedle (Lux) Global Opportunities Bond FundDesigned to minimise interest rate exposure

10 year Government Bond Yields

Source: Bloomberg, June 2011

Yield increase on 10 year bonds that would generate a negative annual return

Source: Bloomberg, June 2011

Interest rates are at multi decade lows

Many traditional bond strategies offer poor protection from rising interest rates

0123456789

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11

Yie

ld

Gilts Treasuries JGBs Bunds0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

Mar-98 Mar-00 Mar-02 Mar-04 Mar-06 Mar-08 Mar-10

The Threadneedle (Lux) Global Opportunities Bond Fund is designed to deliver positivereturns in both rising and falling rate environments

PT/11/00506 32

Government bond fundamentalsLow Economic growth for sometime to come

UK GDP

Eurozone GDP

US GDP

Japan GDP

Source: Bloomberg as at 31 August 2011. All data is year on year. US, Euro and Japan is seasonally adjusted

33

-10%

-5%

0%

5%

10%

1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010

Cha

nge

(YoY

) .

GDP Average Threadneedle estimate

-12%-10%

-8%-6%-4%-2%0%2%4%

1997 1999 2000 2002 2003 2005 2006 2008 2009 2011

Cha

nge

(YoY

) .

GDP Average Threadneedle estimate

-8%-6%-4%-2%0%2%4%6%

2000 2001 2003 2004 2006 2007 2009 2010

Cha

nge

(YoY

) .

GDP Average Threadneedle estimate

-8%-6%-4%-2%0%2%4%6%

2000 2001 2003 2004 2006 2007 2009 2010

Cha

nge

(YoY

) .

GDP Average Threadneedle estimate

-6%-4%-2%0%2%4%6%

1995 1996 1998 1999 2001 2002 2004 2005 2007 2008 2010

Cha

nge

(YoY

) .

GDP Average Threadneedle estimate

PT/11/00506

Japan CPI

US CPI

Government bond fundamentalsLow Inflation

UK CPI

Eurozone CPI

Source: Bloomberg as at 31 August 2011. Japan CPI is year on year. Euro CPI is core year on year, ex food & energy. UK CPI is year on year EU Harmonised. US CPI is core year on year ex food and energy

34

0%

2%

4%

6%

8%

10%

1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011

Cha

nge

(YoY

) .

CPI Average Threadneedle estimate

0%

1%

2%

3%

4%

1995 1996 1998 1999 2001 2002 2004 2005 2007 2008 2010 2011

Cha

nge

(YoY

) .

CPI Average Threadneedle estimate

-4%

-2%

0%

2%

4%

6%

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

Cha

nge

(YoY

) .

CPI Average Threadneedle estimate

0%

1%

2%

3%

4%

5%

1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011

Cha

nge

(YoY

) .

CPI Average Threadneedle estimate

PT/11/00506

Growth and Corporate Bond SpreadsEconomic pessimism is high

PT/11/00506 35

US Corporate bond spreads and economicgrowth seem to be reasonably correlated(see chart left)

US Corporate bond spreads seem to bediscounting a severe US economicoutlook. Our regression model suggests economic growth of

around zero is consistent with current spreads of227bps (4/11/11) in the USA. This is much worsethan our forecast.

Threadneedle Growth forecast is 1.5% for 2011 &2012.

Consensus Forecast is 1.8% this year and 2.4% in2012Source Bloomberg/Merrill Lynch – November 2011

US GDP Growth & Corporate Spreads

Threadneedle total AUM – £67.7 billion

Source: Threadneedle as at 30 June 2011

Threadneedle Investments

An established global asset manager

Founded 1994

AUM £67.7 billion

127 investment professionals & 615 employees

Sole focus is active management of client assets

Equities

Fixed Income

Commodities

Multi-Asset

Property

Owned by Ameriprise Financial Inc.

AUM – institutional vs. wholesale

Source: Threadneedle as at 30 June 2011

PT/11/00506 36

Property8.5%

Equities58.0%

Fixed income30.7%

Cash2.8%

Source: Threadneedle as at 30 June 2011 AUM excludes externally managed funds under administration

Retail33.0%

Institutional67.0%

An established and active global manager

Investment philosophy – out-think, out-perform

PT/11/00506

We are stronger collectively than as individuals

Our investment process is structured to reflect this belief

We have a global approach and cover all asset classes

37

Teamwork defines us

out-think

teamwork

out-perform

All asset classes

Globalapproach

Investment process – out-think, out-perform

PT/11/00506 38

Economic background

Sectors and themes

Asset allocation

Valuation framework

Asset and sectorallocation models

Themes / analysis and debate

Bottom-up security selection across capital structure

Equity

Multi-asset

Fixed income

Absolute return

Debate Execution / deliveryIdea generation

+ +

2. Team work 3. Out-perform1. Out-think

out-think

teamwork

out-perform

All asset classes

Globalapproach

This sets the agenda for our specialist teams

Collectively we form a global investment view on

The central case for economies

The valuation of asset classes

Outstanding fixed income performance

Strategy type Fund Currency Gross / Net

6 months 1 year 3 years (p.a.) 5 years (p.a.)

Fund Rel. Fund Rel. Fund Rel. Fund Rel.

Single strategy

Govt. and rates

Threadneedle Sterling Bond Fund GBP Gross -3.29 +0.26 -6.51 -0.01 2.89 -0.01 0.27 +0.20Threadneedle European Bond Fund EUR Gross 0.10 +0.09 -0.20 +0.72 8.34 +2.89 5.27 +1.85Threadneedle Global Bond Fund EUR Gross -3.16 -0.57 -8.34 -1.37 8.13 +1.42 4.53 +0.68

Emerging marketsThreadneedle Emerging Market Bond Fund USD Gross -2.67 +0.09 -5.81 -0.22 13.98 +0.39 8.21 +1.25Threadneedle Emerging Market Local Fund USD Gross -1.88 -0.83 -0.09 -1.18 12.77 -1.07

High yieldThreadneedle High Yield Bond Fund GBP Net -1.68 -0.24 2.18 -0.47 6.68 +1.51 2.20 +2.06Threadneedle European High Yield Bond Fund EUR Net 3.70 +0.11 14.02 +1.37 11.23 +0.35 7.12 +0.62

Investment gradeThreadneedle UK Corporate Bond Fund GBP Net -1.98 +0.83 -3.65 +0.95 2.84 +0.80 -1.41 +0.36Threadneedle European Corporate Bond Fund EUR Gross 3.03 +1.49 5.76 +3.05 6.24 -0.07 3.48 -0.42

Multi-strategyCredit / High Yield Threadneedle Strategic Bond Fund GBP Net -1.98 -0.02 -0.90 +1.25 4.22 -0.21 -0.22 +0.02Credit / Gov’ts Threadneedle Dollar Bond Fund USD Net -4.89 +0.66 -11.57 +1.50 7.96 +0.17 1.85 -0.81

Alternative

Govt. and rates

Threadneedle Absolute Return Bond Fund GBP Gross -6.88 -2.25 -10.82 -2.44 0.03 +2.74 -0.21 +1.83Threadneedle Target Return Fund EUR Gross -1.96 -2.57 -1.68 -2.74 3.88 +2.20 4.34 +1.65T(Lux) Target Return USD Fund USD Gross -9.89 -2.75 -17.35 -2.47Threadneedle Target Return Core Fund EUR Gross -0.94 -1.37 -0.72 -1.40 2.10 +0.96

Credit / High Yield Threadneedle Credit Opportunities Fund EUR Gross 2.83 +2.37 7.66 +6.88Emerging Markets T(Lux) Absolute Emerging Markets Macro Fund USD Gross -4.85 +2.68Commodities T(Lux) Enhanced Commodities Fund USD Gross -4.15 +6.33 15.12 +8.23

Source: Morningstar to 30 June 2011. Data shown in €. All fund data is based initially in £ share classes, and converted to different currencies using Global-Close FX rates. Fund Returns calculated from 12 noon (UK Time) prices to 31 December 2007 and Global Close prices from 31 January 2008 onwards compared to Global Close Indices. Fund data is quoted on a bid-bid basis with income re-invested at bid. Fund data is gross of tax and T.E.R to facilitate comparison with the indices. Performance for periods greater than one year is annualised. Index data provided by Thomson Financial DataStream, iBoxx, and Merrill Lynch.

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Biography

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DAVID OLIPHANT

David began his career in 1989 with Eagle Star Investment Managers1 as a Sterling Bond analyst. He progressed to managing multi-currency portfolios for Eagle Star and then from 1994, for Threadneedle. David chairs the Fixed Income Themes meeting and is Head of Investment Grade Credit.He graduated in 1988 with an honours degree in economics from the University of St Andrews. He is an associate member of the UK Society of Investment Professionals. Threadneedle start date: 1994Industry start date: 1989

1 Eagle Star Investment Managers became part of Threadneedle in May 1994

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Biography

JAMES CIELINSKI

James Cielinski joined Threadneedle in 2010 as Head of Fixed Income. In this role he is responsible for the overall management of the fixed income business, including investment process, product development and investment strategy. He is also a key participant in Threadneedle’s asset allocation process.Prior to joining Threadneedle James spent 12 years at Goldman Sachs, leaving as Head of Global Credit – Investment Grade. He has also held senior investment roles at Utah Retirement Systems and Brown Brothers Harriman.James graduated from the University of Utah in 1983 with a BSc in Finance and gained an MBA from New York University in 1988.He is also a Chartered Financial Analyst and a member of the UK Society of Securities Analysts.Threadneedle start date: 2010Industry start date: 1983

BARRIE WHITMAN

Barrie Whitman joined Threadneedle in 1999 as Head of High Yield. He manages the Threadneedle High Yield Bond, European High Yield Bond and Strategic Bond Funds as well as a number of institutional mandates. He is also Lead Manager of the Threadneedle Credit Opportunities Fund.Barrie began his investment career in 1987 at United Bank of Kuwait as a credit analyst specialising in high yield bond investment. In 1990 he became a high yield fund manager and, in 1996, CIO for High Yield Investments. He then moved to Standard Bank London in 1997 as Head of European High Yield and Distressed Debt.Barrie graduated in 1982 with a BSc in Economics and Accounting from Hull University and qualified as a Chartered Accountant in 1986. He is a member of the Institute of Chartered Accounts in England and Wales. Threadneedle start date: 1999Industry start date: 1987

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Biography

RICHARD HOUSE

Richard House is Head of Emerging Market Debt at Threadneedle. He also manages a number of the company’s emerging market bond portfolios.Prior to joining Threadneedle in 2007, Richard worked for Wadhwani Asset Management as an emerging markets portfolio manager / trader. He has also worked for HSBC as a portfolio manager responsible for a listed emerging markets debt fund and at Lombard Odier as an emerging markets analyst/portfolio manager.Richard holds a BSc in economics and computer science from the University of Sunderland and an MSC in finance and investment from the University of York. Threadneedle start date: 2007Industry start date: 1994

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HENRY COOKE

Henry Cooke joined Threadneedle in 2010 to run the company’s Asset-Backed Securities Desk in London. In addition to the day-to-day management of the team, he is responsible for raising ABS assets and managingasset-backed positions.Prior to joining Threadneedle Henry worked for five years at Barclays Capital, where he became a Managing Director. He has also held the role of Head of Enterprise Risk at Marsh & McLennan and worked for Nomura International and Goldman Sachs.Henry has an engineering degree from the University of Nottingham.Threadneedle start date: 2010Industry start date: 1986

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Biography

QUENTIN FITZSIMMONS

Quentin Fitzsimmons is an Executive Director and Head of Government Bonds and Foreign Exchange at Threadneedle. He has significant experience and a strong track record in managing third party institutional fixed income client mandates for over 10 years, encompassing the full range of economic and market conditions.Quentin began his career in 1991 at Sun Life Assurance Company of Canada, where he progressed to Senior Investment Analyst before moving to the Equitable Life Assurance Society in 1994 as Senior Portfolio Manager. He then joined F&C (formerly Foreign & Colonial) Investment Management in 1999 and became Director of Fixed Interest (UK bonds) before joining Threadneedle in September 2003.Quentin graduated in 1989 from the University of Bristol with a first class honours degree in economics and economic history. He is also a Member of the Society of Business Economists and has gained professional investment qualifications via the IIMR.Threadneedle start date: 2003Industry start date: 1991

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Important Information

All data as at 30 June.2011 unless otherwise shown. Past performance is not a guide to future performance. The value of investments and any income from them may go down as well as up.

The research and analysis included in this document has been produced by Threadneedle for its own investment management activities, may have been acted upon prior to publication and is made available here incidentally. Information obtained from external sources is believed to be reliable but its accuracy or completeness cannot be guaranteed. Any opinions expressed are made as at the date of publication but are subject to change without notice.

Threadneedle (Lux) is an investment company with variable capital (Société d’investissement à capital variable, or "SICAV") formed under the laws of the Grand Duchy of Luxembourg. The SICAV issues, redeems and exchanges shares of different classes, which are listed on the Luxembourg Stock Exchange. The management company of the SICAV is Threadneedle Management Luxembourg S.A, who is advised by Threadneedle Asset Management Ltd. and/or selected sub-advisors.

The SICAV is registered in Austria, France, Germany, Hong Kong, Italy, Luxembourg, The Netherlands, Portugal, Spain, Sweden, Switzerland, Taiwan and the UK; however, this is subject to applicable jurisdictions and some sub-funds and/or share classes may not be available in all jurisdictions. Shares in the Funds may not be offered to the public in any other country and this document must not be issued, circulated or distributed other than in circumstances which do not constitute an offer to the public and are in accordance with applicable local legislation. Shares in the Funds may not be offered, sold or delivered directly or indirectly in the United States or to or for the account or benefit of any “U.S. Person”, as defined in Regulation S under the 1933 Act.

This material is for information purposes only and does not constitute an offer or solicitation to an order to buy or sell any securities or other financial instruments, or to provide investment advice or services. Subscriptions to a fund may only be made on the basis of the current Prospectus or Simplified Prospectus and the latest annual or interim reports, which can be obtained free of charge on request, from the SICAV's registered office at 69, route d'Esch, L-1470 Luxembourg, Grand Duchy of Luxembourg, or, for Sweden, the Swedish paying agent, Skandinaviska Enskilda Banken AB (publ), Sergels Torg 2, 106 40 Stockholm, Sweden. Please read the prospectus before investing. Investors should note the “Risk Factors” section of the Prospectus in terms of the risk applicable to investing in this Fund.

Issued by Threadneedle Management Luxembourg S.A. Registered with the Registre de Commerce et des Societes (Luxembourg), Registered No. B 110242, 74, rue Mühlenweg, L-2155 Luxembourg, Grand Duchy of Luxembourg.

Issued in Hong Kong by Threadneedle Portfolio Services Hong Kong Limited ("TPSHKL"). Registered Office: 21F ICBC Tower, Citibank Plaza, Central, Hong Kong. Registered in Hong Kong under the Companies Ordinance (Chapter 32), No. 173058. Authorised and regulated in Hong Kong by the Securities and Futures Commission. Please note that TPSHKL can only deal with professional investors in Hong Kong within the meaning of the Securities and Futures Ordinance. The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this document you should obtain independent professional advice.

Issued in Singapore by Threadneedle Investments Singapore (Pte) Limited, 07-07 Winsland House 1, 3 Killiney Road, Singapore 239519. The Fund mentioned in this document is a restricted scheme and is available only to residents of Singapore who are Institutional Investors under Section 304 of the SFA, relevant persons pursuant to Section 305(1), or any person pursuant to Section 305(2) in accordance with the conditions of, any other applicable provision of the SFA. The Fund is not authorised or recognised by the Monetary Authority of Singapore (the “MAS”) and Shares are not allowed to be offered to the retail public. This document is not a prospectus as defined in the SFA. Accordingly, statutory liability under the SFA in relation to the content of prospectuses would not apply.

In the UK issued by Threadneedle Asset Management Services Limited. Registered in England and Wales, Registered No. 573204, 60 St Mary Axe, London EC3A 8JQ, United Kingdom. Authorised and regulated in the UK by the Financial Services Authority.

Threadneedle Investments is a brand name and both the Threadneedle Investments name and logo are trademarks or registered trademarks of the Threadneedle group of companies. threadneedle.com

Information for Investment Professionals (not for onward distribution to, or to be relied upon by, private investors)

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