Full Description

Franklin Resources, Inc., incorporated November 1969, is an investment management company. The Company is a holding company for various subsidiaries that, together with the Company, are referred to as Franklin Templeton Investments, a global investment management organization offering investment choices under the Franklin, Templeton, Mutual Series, Bissett, Fiduciary and Darby brand names. In its primary investment management business and operating segment, it provides, through its wholly owned direct and indirect subsidiaries, investment management and other related services to open-end and closed-end investment companies and funds, unregistered funds, and other private, institutional, high-net-worth and separately-managed accounts in the United States and internationally. In its secondary business and operating segment, banking/finance, it provides clients with select retail banking, private banking and consumer lending services through its bank subsidiaries. In February 2008, the Company acquired a 49% interest in Vietcombank Fund Management, an investment management firm focused on private equity investment in Vietnam.

The Company’s services include fund administration, shareholder services, transfer agency, underwriting, distribution, custodial, trustee and other fiduciary services. Its sponsored investment products include a range of equity, hybrid, fixed-income and money market mutual funds, as well as other investment products that are sold to the public under its brand names.

Investment Management and Related Services

The Company derives substantially all of its revenues from providing investment management and related services to its retail and institutional mutual funds, and to institutional, high-net-worth and separately-managed accounts and other investment products. Underwriting and distribution fees, also a large source of revenue, consist of sales charges and commissions derived from sales of its sponsored investment products and distribution fees. The Company’s investment management services include fundamental investment research and valuation analyses, including original economic, political, industry and company research (including the utilization of such sources as company public records and activities, management interviews, company prepared information, and other publicly available information, as well as company visits and inspections), and analyses of suppliers, customers and competitors. In addition, research services provided by brokerage firms are used to support its findings.

Franklin/Templeton Distributors, Inc. (FTDI), a wholly owned subsidiary of the Company, acts as the principal underwriter and distributor of shares of most of its open-end United States Funds. Franklin Templeton Investor Services, LLC (FTIS), the Company’s subsidiary, provides shareholder record keeping services and acts as transfer agent and dividend-paying agent for its open-end United States Funds. Other subsidiaries provide the same services to the funds offered for sale in Canada, Europe, Asia and other non-United States regions under similar fee arrangements.

Through Fiduciary Trust Company International (Fiduciary Trust) (including its trust company and investment adviser subsidiaries), the Company provides investment management services to, among others, high net-worth individuals and families. Similarly, through its Canadian high-net-worth business unit, Fiduciary Trust Company of Canada (FTCC), it provides investment management services and offers sponsored investment products to high-net-worth individuals and families. The Company offers clients personalized attention and estate planning expertise in a package of services known as Family Resource Management (FRM). The Company provides an array of investment management services to institutional clients, focusing on foundations, endowment funds and government and corporate pension funds. Its subsidiaries offer a range of both United States and international equity, fixed-income and specialty strategies through a variety of investment vehicles, including separate and commingled accounts, open-end and closed-end funds and unregistered funds.

The Company operates its institutional business under the trade name Franklin Templeton Institutional. Its retirement business is conducted through divisions of FTDI that work closely with sponsors of defined contribution plans. Through its subsidiaries, it also markets and distributes its sponsored investment products to separately-managed accounts. Its subsidiaries, Franklin Templeton Financial Services Corp. and Templeton/Franklin Investment Services, Inc., also serve as direct marketing broker/dealers for institutional investors for certain of its institutional mutual funds and private equity funds.

Through various trust company subsidiaries, including Fiduciary Trust, the Company offers a range of investment management and related services, including trust services, custody and administration, estate planning, tax planning, and private banking, to high-net-worth individuals, families, foundations and institutional clients. In addition, it also offers its clients a series of other services, including foreign exchange, performance measurement, securities lending and brokerage services. Its other subsidiaries involved in the trust business, either as trust companies or companies investing in trust companies, include Fiduciary Investment Corporation. The Company’s sponsored investment products are offered to retail, institutional, high net-worth and separate account clients, which include individual investors, qualified groups, trustees, tax-deferred or money purchase plans, employee benefit and profit sharing plans, trust companies, bank trust departments and institutional investors.

Banking/Finance

The Company’s subsidiary, Fiduciary Trust, provides private banking services primarily to high-net-worth clients who maintain trust, custody and/or management accounts. Fiduciary Trust’s private banking and credit products include, among others, loans secured by marketable securities, deposit accounts and other banking services. Deposits generally include demand and savings deposits, primarily from its private banking clients. Fiduciary Trust also offers investment management, custody and related services to institutional accounts and high net-worth individuals and families.

Franklin Capital Corporation (FCC) engages primarily in the purchase, securitization and servicing of retail installment sales contracts (automobile contracts) originated by independent automobile dealerships. Franklin Templeton Bank & Trust, F.S.B. (FTB&T) provides deposit accounts insured by the Federal Deposit Insurance Corporation (FDIC), general consumer loan products, such as credit card loans, unsecured loans, loans secured by marketable securities, mortgage loans, debit card products and automobile loans, and a limited number of commercial real estate loans. Deposits generally include demand, savings and time deposits from the general public and brokered time deposits. FTB&T also provides Advisor Director Trust, a directed trust service.