Profile: Raymond James Financial, Inc. (RJF.N)

Raymond James Financial, Inc. (RJF) is a holding company whose subsidiaries are engaged in various financial services businesses in the United States of America and Canada. As of September 30, 2009, its principal subsidiaries included Raymond James & Associates, Inc. (RJ&A), Raymond James Financial Services, Inc. (RJFS), Raymond James Financial Services Advisors, Inc. (RJFSA), Raymond James Ltd. (RJ Ltd.), Eagle Asset Management, Inc. (Eagle), and Raymond James Bank, FSB (RJ Bank). The Company operates in eight business segments: Private Client Group; Capital Markets; Asset Management; RJ Bank; Emerging Markets; Stock Loan/Borrow; Proprietary Capital and certain corporate activities combined in the Other segment.

RJF's principal subsidiary, RJ&A, is a full service brokerage and investment firm and a retail brokerage firm in North America. RJ&A is a self-clearing broker-dealer engaged in the aspects of securities distribution, trading, investment banking and asset management. RJ&A also offers financial planning services for individuals and provides clearing services for RJFS, RJFSA, other affiliated entities and several unaffiliated broker-dealers. In addition, RJ&A has six institutional sales offices in Europe. RJFS is an independent contractor brokerage firm in the United States Financial Advisors affiliated with RJFS may offer their clients all products and services offered by RJ&A. RJFSA is a registered investment advisor. Financial advisors affiliated with RJFSA may offer their clients investment advisory products and services, including products offered by RJ&A. RJ Ltd. is the Company's Canadian broker-dealer subsidiary, which engages in both retail and institutional distribution and investment banking. Eagle is a registered investment advisor serving as the discretionary manager for individual and institutional equity and fixed income portfolios and its internally sponsored mutual funds. RJ Bank provides traditional banking products and services to the clients of its broker-dealer subsidiaries and to the general public.

Private Client Group

RJF provides securities transaction and financial planning services to approximately 1.9 million client accounts through the branch office systems of RJ&A, RJFS, RJFSA, RJ Ltd. and Raymond James Investment Services Limited (RJIS), a joint venture in the United Kingdom. The Company's Financial Advisors offer a range of investments and services, including both third party and other products, and a range of financial planning services. It charges sales commissions or asset-based fees for investment services it provides to its Private Client Group clients based on established schedules. The Company’s United States Financial Advisors are also licensed to sell insurance and annuity products through its general insurance agency, Planning Corporation of America (PCA), a wholly owned subsidiary of RJ&A. Through the Financial Advisors of the Company's broker-dealer subsidiaries, PCA provides product and marketing support for a range of insurance products, principally fixed and variable annuities, life insurance, disability insurance and long-term care coverage. Its Financial Advisors offer load mutual funds, as well as a selection of no-load funds. RJ&A and RJFS maintain dealer sales agreements with distributors of mutual fund shares sold through broker-dealers.

Capital Markets

Capital Markets activities consist primarily of equity and fixed income products and services. RJF’s institutional clients are serviced by the RJ&A and RJ Ltd. Institutional Equity Departments, the RJ&A Fixed Income Department, RJ&A’s European offices and Raymond James Financial International Ltd, an institutional United Kingdom broker-dealer located in London. The Company charges commissions on equity transactions based on trade size and the amount of business conducted annually with each institution. Fixed income commissions are based on trade size and the characteristics of the specific security involved. RJ&A distributes to its institutional clients both taxable and tax-exempt fixed-income products, primarily municipal, corporate, government agency and mortgage-backed bonds. RJ&A carries inventory positions of taxable and tax-exempt securities in both the primary and secondary markets to facilitate its institutional sales activities. RJ&A trades both taxable and tax-exempt fixed income products. The taxable and tax-exempt RJ&A fixed income traders purchase and sell corporate, municipal, government, government agency, and mortgage-backed bonds, asset backed securities, preferred stock and certificates of deposit from/to its clients or other dealers. RJ&A enters into future commitments, such as forward contracts and to be announced securities.

The domestic senior analysts in RJ&A's research department support the Company's institutional and retail sales efforts and publish research on approximately 725 companies. This research primarily focuses on United States companies in specific industries including technology, telecommunications, consumer, financial services, business and industrial services, healthcare, real estate and energy. RJ&A acts as a consultant, underwriter or selling group member for corporate bonds, mortgage-backed securities, agency bonds, preferred stock and unit investment trusts. When underwriting new issue securities, RJ&A agrees to purchase the issue through a negotiated sale or submits a competitive bid. RJ&A's Investment Banking Group is involved in a variety of activities including public and private equity financing for corporate clients, and merger and acquisition advisory services. RJ Ltd.'s Investment Banking Group consists of approximately 20 professionals located in Calgary, Toronto and Vancouver providing equity financing and financial advisory services to corporate clients. Its investment banking activities provide a range of strategic and financial advisory services tailored to its clients’ business.

Asset Management

RJF's asset management segment includes asset management operations, internally sponsored mutual funds, non-affiliated private account portfolio management alternatives, and other fee-based programs. Eagle is a registered investment advisor with $16.5 billion under management as of September 30, 2009. Eagle also serves as investment advisor to the Eagle Family of Funds. Eagle offers a variety of equity and fixed income objectives managed by seven portfolio management teams and a subsidiary investment advisor, Eagle Boston Investment Management, Inc. Eagle's clients include individuals, corporations, pension and profit sharing plans, foundations, endowments, variable annuities, mutual funds and money market portfolios. The Eagle Family of Funds utilizes unaffiliated sub-advisors for the Municipal Money Market Fund, Capital Appreciation Trust, Growth and Income Fund and the International Equity Fund. The Small Cap Growth Fund, Mid Cap Growth Fund, Large Cap Core Fund and Small Cap Core Value Fund are managed internally. Eagle Fund Services, Inc. (EFS) is the transfer agent for all of the funds and the fund accountant for all Eagle funds except the International Equity Fund. EFS is one of its wholly owned subsidiaries. Eagle Fund Distributors, Inc. (EFD) is a registered broker-dealer engaged in the distribution of the Eagle Family of Funds. EFD is a wholly owned subsidiary of Eagle.

RJ&A's Asset Management Services (AMS) division manages several investment advisory programs. Raymond James Consulting Services and the Eagle High Net Worth programs maintain an approved list of investment managers, provide asset allocation model portfolios, establish custodial facilities, monitor performance of client accounts, provide clients with accounting and other administrative services, and assist investment managers with certain trading management activities. AMS earns fees generally ranging from 0.35% to 0.85% of asset balances per annum, a portion of which is paid to the investment managers who direct the investment of the clients' accounts. In addition, AMS offers managed accounts comprised of fee-based asset allocation platforms under its Freedom and other managed programs. Freedom’s investment committee manages portfolios of separately managed accounts, mutual funds and exchange traded funds on a discretionary basis. AMS earns fees generally ranging from 0.10% to 0.20% of asset balances per annum. As of September 30, 2009, these managed programs had $15.3 billion in assets under management, including $3 billion managed by Eagle.

Raymond James Bank, FSB

RJBank is a federally chartered savings bank, which provides residential, consumer and commercial loans, as well as Federal Deposit Insurance Corporation (FDIC)-insured deposit accounts, to clients of the Company's broker-dealer subsidiaries and to the general public. RJ Bank also purchases residential whole loan packages and is active in bank participations and corporate loan syndications. RJ Bank generates revenue principally through the interest income earned on loans and investments, which is offset by the interest expense it incurs on client deposits and on its borrowings. Access to RJBank's products and services is available nationwide through the offices of its affiliated broker-dealers, as well as through telephonic and electronic banking services.

Emerging Markets

Raymond James International Holdings, Inc. (RJIH) has interests in various Latin American entities. Through these entities The Company operates securities brokerage, investment banking, asset management and equity research businesses.

Stock Loan/Borrow

This activity involves the borrowing and lending of securities from and to other broker-dealers, financial institutions and other counterparties, generally as an intermediary. The borrower of the securities puts up a cash deposit, on which interest is earned. Accordingly, the lender receives cash and pays interest. These cash deposits are adjusted daily to reflect changes in current market value. The net revenues of this operation are the interest spreads generated.

Proprietary Capital

This segment consists of the Company’s principal capital and private equity activities, including direct and third party private equity and merchant banking investments, short-term special situations and bridge investments (Special Situations Investments) and Raymond James Employee Investment Funds I and II (the EIF Funds). It also includes three private equity funds sponsored by the Company: Raymond James Capital Partners, L.P., a merchant banking limited partnership, Ballast Point Ventures, L.P. and Ballast Point Ventures II, L.P., which are both venture capital limited partnerships (the Funds) along with their management companies.