Capita Financial Group – IrelandPaul Nunan

3rd July 2007

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Capita Financial Group IrelandIntroduction

Irish Fund Servicing Industry & Growth

Irish Fund Structures

Industry Trends

Industry Challenges

Regulatory Update

Capita Financial Group in Ireland

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International Funds Industry in Ireland Industry Statistics

Irish Registered Collective Investment Schemes

Alternative Investment Funds 2003 - 2005

Year End Net Asset Values (Eur Billion) Annual % Growth No. of Funds Annual % Growth

2000 208 +39% 2392 +22%

2001 284 +36% 2392 +20%

2002 304 +7% 2870 +15%

2003 362 +19% 3300 +6%

2004 435 +20% 3507 +7%

2005 585 +35% 3712 +2%

2006 730 +25% 3798 +8%

March 2007 769 +5.4 ytd 4087 +2.9% ytd

March 2003 June 2005 % Increase

Number of Funds (incl. Sub funds)

2113 3020 +43%

Net Asset Value

149 354 +138%

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International Funds Industry in IrelandIndustry Statistics

Funds industry in Ireland

Over 1 Trillion euro in Assets under administration

Worlds largest centre for the servicing of alternative investment funds

Over 1/3 of AIF’s serviced in Ireland

8,323 people employed in Funds servicing industry at start of 2007

Average length of service for middle management now stands at greater then five years

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International Funds Industry in IrelandWhy Ireland?

Flexible but robust jurisdiction for regulated products

“Safe pair of hands”

Irish Stock Exchange (Irish and non-Irish Domiciled Funds)

Time Zones

Language

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International Funds Industry in Ireland Main Categories of Irish Funds

O pe n E nd ed U n it T rustO pe n-E nde d Inve stm en t C om p anyC om m on C on tractu a l F u nd (C C F)

U C IT S F un ds

Q ua lifying Investor F un d (Q IF) P ro fe ss ion a l Inve sto r F u nd (P IF)

N on -U C IT S In stitu tio n a l F u nds

U n it T rustIn ve stm ent C o m pa nyL im ite d P a rtn e rsh ip

C C F

N on -U C IT S F u nds

2 M ain C a te gories o f Irish Fun ds

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International Funds Industry in Ireland Authorisation Procedure for Funds

Irish Financial Regulator – Responsible authority for the authorisation of funds

Promoter and Investment Manager Approval Promoter / Investment Manager application Form

Fund Structure Approval Detailed Fact Sheet – Key aspects of the proposed structure

Funds Documents Prospectus Custody Agreement

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International Funds Industry in Ireland Tax Implications of Irish Domiciled Funds

Irish Domiciled Funds UCITS and Non-UCITS are exempt from all sources of Irish Tax

Non-resident investors Exempt from taxation on income and gains arising from their

investments. No WHT applies to any distribution of income or gains The issue of shares in a fund is exempt from capital duty

Taxation of the fund’s assets Double tax Treaties

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International Funds Industry in Ireland Industry Trends

Consolidation of Service Providers State Street acquisition of IFS and IBT Northern Trust & Barings Citigroup and Bisys

Increase in service offering “Middle Office” Daily information

Growth in complex asset types and strategies CDS, CDO, ABS Funds

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International Funds Industry in Ireland Industry Challenges

Capacity Opening of other locations within Ireland Outsourcers outsourcing, - India, Malaysia, Eastern Europe Systems, Drive for more automation

Client Requirements Risk Reporting Performance Reporting Daily P&L / NAV

Growth in complex asset types and strategies Complex Pricing requirements

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International Funds Industry in IrelandRegulatory Update

Qualifying Investor Funds (QIF) 24 hour authorisation by Irish regulator Non UCITS Minimum Subscription of €250,000 Investment Company, Unit Trust, LP or CCF Attractive for Hedge Funds, Fund of Hedge Funds, Private Equity, Real

Estate Funds

Investment Funds, Companies and Miscellaneous Provisions Act Provides for segregation of liability between sub-funds of an Irish

umbrella fund structured as an investment company Permits cross investment between sub-funds of an umbrella

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Capita Financial GroupCapita Ireland

Capita Financial Administrators (Ireland) Limited (CFAI) Administration company Authorised under IIA on 12 July 2006

Capita Financial Managers (Ireland) Limited (CFMI) Management Company Authorised under Management Company Directive on 12 July 2006

Experienced staff Hedge Funds and Alternative Investment Funds Qualified Accountants at all management levels

Systems Utopia Transfer Agency system SunGard Invest One Fund Accounting System Proven systems for Hedge and Alternative Fund Administration

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Capita Financial GroupCapita Ireland – Services Provided

Capita Financial Administrators (Ireland) Limited Fund Administration Transfer Agency / Shareholder Servicing Financial Statement Preparation Corporate Secretarial Services Tax Assistance – US Tax Reporting (PFIC, K1) and German Tax Compliance monitoring of investment restrictions

Capita Financial Managers (Ireland) Limited Corporate governance support ‘Host’ management company Board of directors

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Capita Financial GroupCapita Ireland

Operating model

Client driven operating model

Single knowledgeable point of contact

Scalability/capacity

No legacy issues

Systems

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Capita Financial GroupCapita Ireland – ‘Host’ Management Company

Unique in Irish marketplace

Analogy with highly successful ACD business in the UK

Facilitates entry into the Irish market No suitably licensed management/investment management company Tax/regulatory complications (e.g. Spanish based asset managers) Speed to market

Corporate governance assistance Some or all of the board of directors

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Capita Financial GroupCapita Ireland – Sample Fund Structures

UCITS III Structured Products through UCITS platform Fund holds one TRS tracking an underlying strategy Capita acts as Manager, Investment Manager and Administrator (Client

appointed as Investment Advisor)

Hedge Funds Dublin Domiciled (QIF) BVI domiciled Cayman Funds

Other Master / Feeder Limited Partnerships Umbrella Funds

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Capita Financial GroupCapita Ireland – 2007 / 2008

“Middle Office” Risk Reporting Performance Reporting

Automation Automated Trade interfaces with Client, Custodians and Prime Brokers Automated Reconciliation Tool (Positions, prices, market Values)

Web Access Client web access to Fund accounting system Shareholder web access

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Capita Financial GroupCapita Ireland – Contact details

1 Adelaide Court, Adelaide Road Dublin 2 +353 1 400 5300 (general)

Paul Nunan paul.nunan@capitafinancial.ie +353 1 400 5302 (direct) +353 868553069 (mobile)