lm investment management ltd abn 68 077 208 461

LM Investment Management Ltd – Responsible Entity & Australian Financial Services Licensee No. 220281

LM Investment Management LtdLM Investment Management LtdABN 68 077 208 461ABN 68 077 208 461

Australia’s Specialist Mortgage Trust Manager

GOLD COASTGOLD COAST SYDNEYSYDNEY HONG KONGHONG KONG

LM Investment Management LtdResponsible Entity and Australian Financial Services Licensee No. 220281


LM Mortgage Income Fund

LM Currency Protected Australian Income Fund

LM Investment Management LtdLM Investment Management Ltd



Returns Since Inception of LM Mortgage Income Fund 12 Mth Term compared against the Morningstar Australian Mortgage Trust Index

1.00%

3.00%

5.00%

7.00%

9.00%

Oct-99

Apr-00

Oct-00

Apr-01

Oct-01

Apr-02

Oct-02

Apr-03

Oct-03

Apr-04

Oct-04

Apr-05

Oct-05

The LM Mortgage Income FundThe LM Mortgage Income Fund




What is the LM Mortgage Income Fund?

A diversified “Pool” of commercial loans and cash, with security being held by way of First Registered Mortgages / Charge…



How does the fund work?How does the fund work?

INVESTORS

LMMortgageIncome

Fund

Security

100%

Property

income

income

C OMMERCI AL

LOANS

BORROWERS

interest

interest



Wholesale Mortgage Income FundWholesale Mortgage Income Fund

For Nominee Accounts/Trustee

Investment Platforms

Global Portfolio Bond Wraps

High net worth Individual Account



WholesaleWholesale

Investment Option

Current Effective Rate

Effective RateNet of Withholding

Tax

*2,3,4 Year 7.75%p.a. 6.99%p.a

12 Month 7.50%p.a. 6.75%p.a

AT CALL 6.75%p.a. 6.07%p.a.

CPAIF - -




Conservative Investment Strategy

Cash/At Call and registered first mortgage securities

Diversity – Geographic, Loan Type, Size The average LVR of the mortgage securities is 62.16% (as Nov 2005)

Exposure over total assets of the Fund

58.6%9%

91%



Sector Diversification Sector Diversification

As at 30 Nov 05

Sector Guidelines Actual (%) Min (%) Max (%)

Commercial 23 20 50

Residential 39 35 65

Industrial 4 0 25

Retail 0 0 15

Pre-Development Land 34 0 40



Geographic Diversification Geographic Diversification

As at 30Nov 05

Sector Guidelines Actual (%) Min (%) Max (%)

NSW 42 35 55

VIC 19 15 35

QLD 27 10 30

SA 3 0 7.5

ACT 6 0 17.5

WA & NT 3 0 7.5

TAS 0 0 7.5



Income Reliability

Forecast returns *UF

Maintained via term nature of underlying assets

Interest assurance by The LM Special Participation Fund




LM FundsLM Funds

Regulatory Environment

Regulated under the Managed Investments Act (1998) and the Financial Services Reform Act (2001)

Compliance Plan / Constitution registered with ASIC

Strict Guidelines for Fund Operation and license requirements

Subject to bi-annual independent audit



Returns Since Inception of LM Mortgage Income Fund 12 Mth Term compared against the Morningstar Australian Mortgage Trust Index

1.00%

3.00%

5.00%

7.00%

9.00%

Oct-99

Apr-00

Oct-00

Apr-01

Oct-01

Apr-02

Oct-02

Apr-03

Oct-03

Apr-04

Oct-04

Apr-05

Oct-05




Hansard International Limited

Clerical Medical

Scottish Life International

Scottish Provident International Ltd

Zurich International Life Limited

Friends Provident

International

Generali Life International Royal Skandia

AXA International

The LM Mortgage Income Fund The LM Mortgage Income Fund Can be selected on 9 Global Portfolio BondsCan be selected on 9 Global Portfolio Bonds



The LM Mortgage Income Fund - Can be selected on 46 Master Trusts / Wrap ServicesThe LM Mortgage Income Fund - Can be selected on 46 Master Trusts / Wrap ServicesANZ Private Portfolio

(at call only)Assetlink Investment Wrap Assetchoice Investment Wrap

AUSMAQ Wrap (at call only) AustChoice Master Trust (super) Avenue Super Wrap Service

Avanteos ASGARD Investment Funds Account Avenue Wrap Services

ASGARD Trustee Funds Account ASGARD Allocated Pension Account ASGARD Superannuation Account

ASGARD Employee Superannuation Account

ASGARD eWRAP Investment Account ASGARD eWRAP Super Account

ASGARD eWRAP Pension Account BT Super Wrap BT Wrap

Count Wrap Dominion Master Trust Easy Street Wrap

E*TRADE (at call only) FSP Prestige Plus Investar Portfolio Management Ltd

Investment Exchange IOOF Portfolio Services ING Portfolio One (at call only)

Investor Service Wrap Iselect Madison Wrap

Macquarie Non Super Wrap (at call only)

Macquarie Super Wrap Mentor

Navigator Personal Investment Plan

Navigator Personal Retirement Plan

Netwealth Superannuation Master Fund

Netwealth Wrap Account Private Client Service Investment Wrap (PCS)

Portfolio Focus

Sanford Securities (at call only)

Smartsave Strategy Retirement Fund Master Trust

Strategy Portfolio Service Symetry (at call only) WrapIT (at call only)

Wealthtrac



Funds Under ManagementFunds Under Management

Financial Year ended

Growth

Targ

et

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Ta

rge

t



74

139

141

148

160

249

341

345

387

553

0 100 200 300 400 500 600

$m

LM Investment Management

State Super Financial Services

Skandia

Macquarie Bank Group

ING / ANZ Group

AMP

St George Group

National / MLC Group

Platinum Asset Management

AXA Group

Ma

na

ge

r

Top 10 Quarterly Retail Net Fund InflowsThree Months to March 31, 2005

Top 10 total: $2517m

Industry total: $1800 The Australian Financial ReviewThursday, 30th June 2005

$m



Fund HistoryFund History

No capital loss

No variation of forecast rates

Outperformance of the Morningstar Australian Mortgage Trust Index



Standard & Poors 2005 Australian Fund Awards Standard & Poors 2005 Australian Fund Awards

LM Investment Management LtdLM Investment Management LtdBoutique Fund Manager of the Year

Finalist Finalist

LM Mortgage Income FundLM Mortgage Income FundMortgage Fund of the Year

Finalist

“according to S & P, each sector and group finalist included top quality fund managers”

Independent Financial Adviser Magazine 281 Aug 29-Sept 04, 2005 p8



The LM Currency Protected The LM Currency Protected Australian Income FundAustralian Income Fund




Forecast Effective Returns Forecast Effective Returns LM – CPAIF

12 Month Term

JPY ¥ 2.50%p.a (2.25%p.a)

USD $ 5.75%p.a (5.17%p.a)

Euro € 4.50%p.a (4.05%p.a)

GBP £ 6.75%p.a (6.07%p.a)

SGD $ 4.00%p.a (3.60%p.a)

NZD $ 8.75%p.a (7.87%p.a)

AUD$ 7.50%p.a (6.75%p.a)



Real Deposit Alternative Real Deposit Alternative

New 3 & 6 month competitive rates

Alternative to bank deposit

Opportunity for you to manage clients deposit money

Today’s deposit money is often tomorrows investment capital




6 Month Term

JPY ¥ 2.40%p.a (2.16%p.a)

USD $ 5.60%p.a (5.04%p.a)

Euro € 4.35%p.a (3.91%p.a)

GBP £ 6.60%p.a (5.94%p.a)

SGD $ 3.90%p.a (3.51%p.a)

NZD $ 8.65%p.a (7.78%p.a)

AUD$ 6.00%p.a (5.40%p.a)




3 Month Term

JPY ¥ 2.25%p.a (2.02%p.a)

USD $ 5.40%p.a (4.86%p.a)

Euro € 4.20%p.a (3.78%p.a)

GBP £ 6.55%p.a (5.89%p.a)

SGD $ 3.80%p.a (3.42%p.a)

NZD $ 8.55%p.a (7.69%p.a)

AUD$ 5.00%p.a (4.50%p.a)



The Fund’s objective is achieved through:

Investment in the LM Mortgage Income Fund

Hedging the currency exposure




Currency Protection Currency Protection

The fund will eliminate the currency risk for investors

through the use of “Forward Foreign Exchange Contracts” (FFEC)

Executed by



Investor

Subscription AccountDistribution Account

UBS

CPAIFMIF Units MIF Units

MIF

Cash

71

2aSPOT

2a 2bFFEC

3 5

MORTGAGES

2b

6

4



FUND SPECIFICSFUND SPECIFICSMinimum investment of A$ 50 000

Wholesale component to facilitate investment via bond platforms

Commission is calculated and paid on the A$ investment value

Investment details are reported in the relevant currency of the investor

Initial Term of 12 months




6 Years of Investment Performance….

Now Currency Protected….

lm investment management ltd abn 68 077 208 461

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