Rathbone Brothers Plc Report and Accounts 2009

Rathbone Brothers Plc Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 107 Company accounts 57 Consolidated accounts 27 Governance 1 Review 108 Company balance sheet 58 Independent auditors’ report to the 28 Directors’ report 1 Financial highlights 109 Notes to the individual accounts members of Rathbone Brothers Plc 32 Corporate governance report 2 Chairman’s statement 114 Notice of Annual General Meeting 60 Consolidated income statement 36 Remuneration report 3 Chief executive’s statement 121 Five year record 61 Consolidated statement of 44 Audit committee report 6 Rathbones at a glance 122 Corporate information comprehensive income 46 Nomination committee report 8 Strategy and key 123 Our offices 61 Consolidated statement of 47 Corporate responsibility report performance indicators changes in equity 56 Statement of directors’ responsibilities 10 Business review 62 Consolidated balance sheet in respect of the report and accounts 24 Directors 63 Consolidated cash flow statement 64 Notes to the consolidated accounts Financial highlights Investment Management. are managedbyRathbone of which £12.16billion £13.10 billionofclientfunds managed Rathbones As at31December2009, advice andbankingservices. company management,pension trusts, taxplanning,trustand investment management,unit This includesdiscretionary private investorsandtrustees. management servicesfor investment andwealth of high-quality, personalised leading independentprovider Brothers PlcRathbone is a 1 Dividends pershare Basic earningspershare (continuing operations) Basic earningspershare (continuing operations) Profit beforetax (continuing operations) Operating income Funds undermanagement held forsale(seenote 10totheconsolidatedfinancialstatements) Continuing operations exclude businessesdisposedofandclassified as

1 1 1

£13.10bn £116.8m £29.5m 45.55p 46.87p 42.0p

2009

£10.46bn £131.2m £42.3m 44.45p 67.57p

42.0p

2008

(30.6)% (30.3)% (11.0)% 25.2% % change 2.5% –

Page 21 investment managerstodrawon. well-researched guidancefor Process providesstructureand Investment The Rathbone Skill Page 19 and permanence. built astrongreputationforquality leading investmentmanagerthathas isalong-established, Rathbones Stability Page 17 and trustees. services toprivateclients,charities management andwealth high-quality, personalisedinvestment We arefocusedonproviding Operational excellence Page 15 listed company. isanindependent, Rathbones Independence Page 13 an importantdistinction. we offer aservice.For us,thatis We donotsellproducts– Relationships

Rathbone Brothers Plc 1 Financial highlights Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 2 Chairman’s statement Chairman Mark Powell Chairman’s statement Results and dividends Market and environment Composition of the Board Outlook

had, to 31 December 2009, broughtsome had, to31December2009, agreement withLloydsBankingGroupwhich last quarteroftheyearweenteredintoan in fundsundermanagementof6.7%.Inthe hasachieved netorganicgrowth Rathbones In thisverychallenging environment, FTSE 100Index fell byafurther 13.6%by the year. the Havingfallenby31.3%in2008, after experiencing extreme volatilityduring Financial marketsendedonahighin2009, there willbenofinaldividend. dividend willbepaidon31 March 2010,and regulatory capitalposition.The secondinterim and reflectsourstrongbalancesheet total dividendpershareof42.0pfortheyear of afinaldividend. This makesanunchanged dividend of26.0ppersharebepaidinplace The Boardrecommendsthatasecondinterim of ouroverseasbusinessesinthatyear. 67.57p)46.87p (2008: reflectingthesale per sharefromcontinuingoperationswere Basicearnings compared with44.45pin2008. basicearningspershare were45.55p 2009 £1.4million). levy costof£0.2million(2008: Financial ServicesCompensationScheme anda Banking Grouptransactionin2009 £0.8 millioninconnectionwiththeLloyds This figureisstruckin 2008. after charging £29.5 millioncomparedwith£42.3 were the yearto31December2009 Profit beforetaxfromcontinuing operationsfor in theyear. excluding marketmovements was 12.5% Total growthinfundsundermanagement, management toRathbones. millionoffundsunder 2,000 clientsand£381 5227 in 2008, down 10.0%. 5227 in2008, charging dates was4706 comparedwith FTSE keyquarterly 100Index onRathbones’ Index of22.1%.The average levelofthe Balanced Index of12.7%andtheFTSE 100 This compareswithariseintheFTSE APCIMS £9.43billion). 29.0% to£12.16billion(2008: Investment ManagementInternational) roseby Investment Management(includingRathbone Funds undermanagementinRathbone uncertainty ofanelectionyearin2010. Public SectorBorrowingRequirementandthe low levelsdespitethealarmingincreasein year. Interestrateshaveremainedatextremely 41.3% attheyearend,ariseof22.1%on early March. Ithadsubsequentlyrecoveredby Results anddividends Market andenvironment

and hasdonesowithgreatflair. Heleavesa our unittrustbusinessoverthelasttenyears Limited. Peter hasledtheestablishmentof UnitTrustexecutive ofRathbone Management when MikeWebb takescharge aschief in 2010.Hewillleaveuson31March 2010 Management Limited,wasplanningtoretire and chief UnitTrust executive ofRathbone Peter Pearson Lund, adirectoroftheCompany In ourinterimstatementweannouncedthat market movements. as netredemptionsoutweighedpositive year to£0.94billionat31December2009 from £1.03billionatthebeginningof UnitTrustin Rathbone Managementfell 8.7% In thesameperiod,fundsundermanagement to£18.5millionin2009. million in2008 from£31.0 net interestincomefell by40.3% income onclientdeposits.Duringtheyear, tobenefitfromnetinterest for Rathbones Extremely lowbaseratesmakeitverydifficult 23 February 2010 Chairman Mark Powell remains well-capitalised. continuestogroworganicallyand Rathbones are expected toarisein2011andmeanwhile of thetransactionwithLloydsBankingGroup before June2010.The considerablebenefits low interestratesandageneralelection facesanenvironmentofexceptionally the UK The outlookfor2010remainsuncertainas and thefinancialsectorgenerally. relevant experience ofinvestmentmanagement non-executive directorswhobringvaluableand of Kate Avery andKathryn Matthewsasnew In Januaryweannouncedtheappointment thank them. and valuablecontributionstoourBoardwe Peter, JamesandMarkhavemadeimportant and willalsonotstandforre-election. devote thetimeheconsidersisappropriate Robertshaw hasdecidedthathecannolonger that hewillnotstandforre-election.Mark director forthepastsixyearshasdecided James Barclaywhohasbeenanon-executive potential todevelopfurther. and hasthe and reputationofRathbones business which hascontributedtothegrowth Composition oftheBoard Outlook

acquisitions) was £546 million in 2009. This, millionin2009. acquisitions) was£546 (either fromnewinvestmentmanagersor their clients.What wecallnetacquiredgrowth recruit individualinvestmentmanagersand the headlines,wehavecontinuedquietlyto Although corporateacquisitionstendtomake Financial Advisers. our onlineoffering toIndependent improving oursystemsandgreatly regulation, wealsocontinuetoinvestin In additiontotheever-increasingcostof to largerpremisesinEdinburghduring2010. management) andweanticipatemoving largest office(asmeasuredbyfundsunder The Edinburghofficeisnowoursecond substantially enlargeourpresenceinScotland. of theLloydsBankingGrouptransaction,will in thesizeofourEdinburghofficeasaresult and this,coupledwiththesignificantincrease 2010, weopenedanewofficeinAberdeen, growth opportunitiesastheyarise.Earlyin we arebetterplacedtotakeadvantageof We continuetoinvestinthebusinesssothat profit andgrowth. to rewardpeoplethroughawardslinked is importanttomaintainourfocusoncostsand Weannualised comparedto2009. believeit 2010 payrollwillincreasebylessthan2.0% have limitedoverallpayinflationsuch thatour closely, andforthesecondyearrunningwe We havecontinuedtowatch ourcostbasevery across alargerbusiness. spread operationalandregulatorycosts with ouroverallstrategyandallowusto our abilitytomakeacquisitionsthatfit come tofruition.The transaction demonstrates it canbebeforesomegrowthopportunities which givessomeindicationof justhowlong considered thistransactionback in2008, Group towardstheendofyear. We first substantial transactionwithLloydsBanking organicallyandthroughareasonably both have continuedtogrowourbusiness Importantly inthesedifficulttimeswe great credittothehardworkofallourstaff. continuing operationsof£29.5millionis economy,of theUK ourfullyear profitfrom considerable uncertaintyregardingthefuture andthe at 4434thestartof2009 Given abackground ofaFTSE 100Index Chief executive’s statement £19.6 million (2008: £19.0million)the £19.6 million(2008: With profitattributable toequityholdersof growth rateofover12%. client funds)of£631million,represents atotal existing investmentmanagersattractadditional together withnetorganicgrowth (whereour Key highlights

our abilitytoachieve highinterestrateson counterparty risks.Bydefinition,thislimits as wehavenotwantedtotakeinappropriate wherewehave placed ourcash cautious about 2010. We havealsocontinuedtobevery low interestrateswhich havecontinued into This reflectsthefullimpactof exceptionally million earnedinthesecondhalfofyear. withonly£5.7 from £31.0millionin2008 interest incomefell to£18.5million in2009 considerably lowerthaninpreviousyears.Net was surprise thattheinterestmarginin2009 itisno dramatic fallininterestrates2008 shortfall wasoninterestmargin.Following the The mostnoticeableincome in linewith2008. difficult firsthalfandcommissionlevelswere in thesecondhalfrecoveredfromavery Fees from£131.2millionin2008. in 2009 Net operatingincomefell to£116.8 million the business. covered, reflectingourconfidencein dividend of42.0ppershareis1.1times compared with£1.3 millionin2008. amortisation was £2.0millionin2009 Banking Group transaction. Intangibleasset £0.8 millionofcostsarisingfrom theLloyds include Operatingexpenses in 2009 2008. favourable thanthe£1.4million charged in of£0.2million ismuchcharge more for2009 lower thanexpected, sotheprofitandloss Services CompensationScheme, havebeen largely driveleviespayabletotheFinancial costs,which items. Governmentborrowing been impactedbyanumberofspecific Our overallfinancialperformancehasalso this importantpartofRathbones. We look forward to working with him to develop Management witheffect from1April2010. chief Unit Trust executive ofRathbone February 2010andwillbetakingoveras rebuild momentum.MikeWebb joinedusin improvement, althoughitwilltakeawhileto wehaveseensome signsof end of2009 a periodofpoorperformance.Towards the following albeit mostlyinthefirsthalfof2009 continued toexperience netoutflowsoffunds, UnitTrustRathbone ManagementLimitedhas were down2.2%. transaction costs,otheroperatingexpenses Scheme leviesandLloydsBankingGroup amortisation, FinancialServicesCompensation butexcluding intangibleasset 2009, to£87.3 millionin2008 £88.9 millionin Operating expenses fell 1.8%from and placedbyusinthemoneymarkets. the clientmoneythatisheldbyusasbanker Financial performance

Chief executive Andy Pomfret

Key highlights Financial performance Marketing and business development Corporate activity Treasury and financing Investing in our business Regulation Outlook Rathbone Brothers Plc 3 Chief executive’s statement Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 4 Chief executive’s statement Key highlights Financial performance Marketing and business development Corporate activity Treasury and financing Investing in our business Regulation Outlook We willcontinuetouseadvertisinginthis nationally.to increaseawarenessofRathbones background advertisinginthe national press For fouryearswehaveinvestedselectivelyin funds undermanagementincreasingto Our charities teamcontinuestogrow, with that wemightotherwisenothaveseen. approach hasandwillbringusbusiness aswebelieve this held nineduring2009) we willberunningmoreIFA seminars(we offer toselectedfirms.Inthecomingyear outlines themorestructuredapproach we new marketingliteratureforIFAs which of privateclientportfolios,wehavelaunched outsource theinvestmentmanagement to bea‘one-stop-shop’forIFAs lookingto Management Limited.Inlinewithouraim Investment mandate withRathbone +2%)accessedthrough adiscretionary LIBOR inflation +5%,andatotalreturnfundtargeting (a strategicgrowthportfoliofundtargeting and launched twounitisedmultiassetfunds of ourproductsandserviceforIFAs, We haveendeavouredtoincreasetheappeal movescloser. of theRDR relationships developastheimplementation management, andwearekeentoseemore milliontoourfundsunder added over£90 with Cavanagh.This relationship alonehas more sophisticatedIFAs, themostvisible in placewithanumberofthelargerand management, andwehavearrangements arrangements fordiscretionaryinvestment Review iscausingmanyIFAs toreviewtheir As indicatedlastyear, theRetailDistribution 31 December2009. over theyeartojustbelow34,000at we nowacthasincreasedbysome8% referrals andthenumberofclients forwhom Existing clientsremainourbestsourceof way –notleastwherewemakeacquisitions. to becomeincreasingly awareofethicaland to enhanceitslocal profile.Investorscontinue sponsored theSchumacher lectureinBristol and It heldsomesuccessfulevents in 2009, billionintheyear.from £0.32billionto£0.38 good year, growingfundsunder management Greenbank Investments,hashad aparticularly Our ethicalinvestmentservice, Rathbone inLondon inSeptember2010. Royal Society its firstsymposiumfor existing clientsatthe second CharityTimes awardandplanstohold of clientservice.The charities teamwonits marketing andcontinuedhighstandards of goodinvestmentperformance,energetic £1.1 (2008: billion), reflectingacombination nearly £1.4billionat31December2009 Marketing andbusinessdevelopment

takeover of HBOS by Lloyds TSB late in 2008. byLloydsTSB latein2008. takeover ofHBOS wassoonfollowedbythe to formHBOS as themergerofHalifaxandBankScotland considerable change overthelastfew years, of theBankScotlandhadbeenthrough The Portfolio ManagementService(‘PMS’) transaction consistingofthreeelements. from LloydsBankingGroupthrougha weacquiredsomebusiness In October2009 devoted inthefuture. which additionalresourceswill needtobe an increasinglychallenging role andoneto products becomemorecomplex, thisbecomes for investmentaresuitableourclients.As ensure thatthoseproductsweapprove of hedgefundsandstructuredproductsto fund a smallcentralteamtoresearching both committee structure,wecontinuetodedicate In additiontoourpractitioner-ledinvestment continue togrow. green issues,soIexpect thebusiness to minimum consideration levelsinrespectof standard terms,subjecttosome Rathbone only bepayingfor clientsthatsignupto For allthreepartsofthisacquisition, wewill relationship withLloyds. are lookingforwardtodeveloping this arrangement hasafiveyearterm andwe to theirunitisedservice.Initially, this of theirclientswhodonotwishtosubscribe Finally, Lloydshaveagreedto refer tousall of ouroffices. add fundsundermanagementtoanumber with them.This givesusanopportunityto year, butnostaffwilltransfer fromLloyds business willmigratetousoverthecoming of than £2millioninvested.These twobooks no longerwishtoprovideclientswithless investment insecurities,somethingLloyds seeking aninvestmentportfoliowithadirect ofLloyds’ clients acquire twolegacybooks The secondpartofthetransactionwasto investment service. clients withstabilityandahighquality tohelpprovideournew worked atPMS at least12individualsfromthe50orsowho We31 December2009. expect toemploy in reportedfundsundermanagementat millionare included Of thesefunds,£381 £500 millionoffundsundermanagement. 65% ofthetotalnumberandnearly representing some portfolios toRathbones, clients havenowconsentedtotransfer their under management,andover2,500former millionoffunds The businesshadsome£800 Corporate activity

Staff remainourmostimportant asset;they reinvested funds. asinvestmentmanagershave 2009 approximately £0.8billionat31December liquidity hasreducedfrom£1.1billionto fromFitch. Client have anArating(orabove) very cautiously, selectingcounterparties that Our treasuryteamhascontinuedtoinvest £9.2million). (2008: was £6.2millionat31December2009 good use.Ourlevelofexternal borrowings from anearningsperspectivetoputthis Jersey-based trustbusinessanditishelpful regulatory capitalfollowingthesaleofour year, weheldsignificantamountsofsurplus from ourowninternalresources.Asnotedlast The acquisitionfromLloydswillbefunded of investmentmanagementclients. to strengthenourrelationshipswithanumber This businesscontinuestoprovideameans service foranumberofwealthyfamilies. our overallstrategytodevelopafamilyoffice trustbusinessaspartof expand theUK I ampleasedthatwehavebeenableto businesses tothriveunderourownership. have madeitmoredifficultforthese pressure onoffshorejurisdictionswould has provedtimelyasthecontinuedregulatory trust division.The saleofthese businesses all disposalsrelatingtoourformeroffshore happens earlyin2010wewillhavecompleted number ofoffshoretrustclients.When that was usedtofacilitatetransactionsforasmall the returnofBVIbankinglicencewhich management teams.We arecurrentlyfinalising Geneva, SingaporeandtheBVI–each totheir of thesalesouroffshoretrustoperationsin Other corporateactivityinvolvedthecompletion been abletomoveclientsonoursystems. validated bythespeedwithwhich wehave have madeoverseveralyearshasbeen systems, peopleandinfrastructurethatwe process runssmoothly. The investmentin worked hardtoensurethattheclientmigration the Lloydslegacybusiness.Ourteamshave efficient Save As You Earnscheme. This helps basis. We have recentlyintroducedatax over 84%ofourstaffcontribute onamonthly We operateaShareIncentivePlanintowhich two years,ourstaffturnoverrate remainslow. Notwithstanding ourpayrestraint overthepast toourclients. present thefaceofRathbones Investing inourbusiness Treasury andfinancing

We workhardtomaintaingoodrelationships more normallevelsin2010andbeyond. expect thelevelofinvestment torevert Werefurbishment costsin2008. would with some£1.0millionofLiverpooloffice combined and projectprioritisationin2009 largelyasaresultofcostfocus in 2008 was 54%downonthe£5.0millionspent software, property, plantandequipment Capital expenditure of£2.3million on accommodate expansion in2010. moving toanewofficeinEdinburgh we openedinAberdeen.We anticipate new officeinChichester and in early2010 wemovedtoa cost element).During2009 occupy (propertybeingoursecondlargest to upgradeandimprovethepremiseswe As thebusinesshasgrown,wecontinue We continuetoinvestinstafftraining. staff shareholdinginthebusiness. to furtherourunderlyingdesireincrease 23 February 2010 Chief executive Andy Pomfret the year. have remainedverysupportivethroughout circumstances. Ialsothankourclientswho who haveworkedsohardinverydifficult I takethisopportunitytothankallourstaff placed forthefuture. our organicgrowthcontinues.We arewell demonstrated wecanmakeacquisitions,and The businessiswellcapitalised,wehave volatile andunpredictable. positive note.Marketsin2010maywellbeas the business,albeitendingonarathermore wasachallenging yearfor Overall 2009 services inthefuture. can learnsothatweareabletoimproveour but therewillbeanumberoflessonsthatwe Overall, thefeedback receivedwaspositive undertaking asurveyofourexisting clients. ‘Treating ClientsFairly’ projects–mostnotably Over theyearwehaveworkedonanumberof aimed atmuch largerbanks. we mayfaceadditionalregulationsthatare is increasingandweareverymuch awarethat with ourregulators.The burdenofregulation Regulation Outlook

Total Rathbones Investment Management

Funds under management The Investment Management division provides mainly discretionary investment management services to private investors and charities with portfolios held in discretionary accounts, trust structures, ISA accounts or self-invested personal pensions from offices in the UK and Jersey.

Rathbones at a glance The majority of clients have a fee-based service with

6 securities held in a Rathbone nominee company and surplus cash held by Rathbone Investment Management, an authorised banking institution. Rathbone Pension & Advisory Services advises clients on

2009 2008 retirement planning options and offers the Rathbone SIPP. £bn £bn Investment Management 12.16 9.43 Principal trading names Unit Trusts 0.94 1.03 • Rathbone Investment Management • Rathbone Investment Management International 13.10 10.46 • Rathbone Pension & Advisory Services

Direct employees (average full time equivalents) Operating income (continuing operations) • 438 (145 investment professionals)

Offices • Aberdeen (opened in January 2010) • Birmingham • Bristol • Cambridge • Chichester • Edinburgh • Exeter • Jersey • Kendal 2009 2008 £m £m • Liverpool Investment Management 104.3 113.9 • London Unit Trusts 7.7 12.4 • Winchester Trust and Tax 4.7 4.9 Head of Investment Management 116.7 131.2 • Richard Lanyon Websites Profit before tax (continuing operations) • General: www.rathbones.com • Ethical investment: www.rathbonegreenbank.com

Top ten UK private client wealth managers (ranked by discretionary assets under management)

Discretionary Total £m AUM AUM Coutts 10,368 12,960 Brewin Dolphin 10,200 18,700 Rathbones 9,414 10,460 Barclays/Gerrard 8,193 27,309 Rensburg Sheppards 8,150 11,450 2009 2008 £m £m UBS 7,014 19,483 Investment Management 29.2 39.7 Merrill Lynch 4,590 9,000 Unit Trusts 0.1 2.4 Morgan Stanley PWM 4,524 11,600 Trust and Tax 0.2 0.2 Goldman Sachs 4,447 15,883 Source: Canaccord Adams estimates. Private Client Wealth Managers report, 29.5 42.3 January 2009 (the latest published edition) Rathbone Brothers Plc Report and accounts 2009 Investment Management Unit Trusts

Client base breakdown The Unit Trusts division has a range of Unit Trusts which are distributed mainly through independent financial Discretionary vs non-discretionary (by funds advisers in the UK. under management) These funds are purchased through financial supermarkets, life assurance companies and through direct contact with financial advisers. Rathbones at a glance

Funds cover the UK stock market, embracing small, 7 medium and large companies to achieve growth and income. In addition we manage an ethical bond fund and one global fund focused on international opportunities.

Principal trading name • Rathbone Unit Trust Management

As at 31 Dec 2009 % Direct employees (average full time equivalents) Discretionary 93.9 • 24 Non-discretionary 6.1 Offices • London Account type (by funds under management) Head of Unit Trusts • Peter Pearson Lund (until 31 March 2010) • Mike Webb (from 1 April 2010)

Website • www.rutm.com

Trust and Tax

The Trust and Tax division is based in the UK and provides

As at 31 Dec 2009 % taxation services (compliance and planning), probate Private client 46.2 services, trust services (trust formation, administration, Trust and settlements 16.0 accounting and provision of trustees and protectors), and ISAs 12.3 family office services. Charities 11.4 Principal trading name Pensions, including SIPPs 10.7 • Rathbone Trust Company Other 3.4 Direct employees in continuing operations (average full time equivalents) Account size (by value) • 40

Offices • Liverpool • London

Head of Trust and Tax • Ian Buckley

Website • www.rathbones.com

As at 31 Dec 2009 % Over £1million 48.1 £500,000 – £1million 18.4 £250,000 – £499,999 17.0

£100,000 – £249,999 12.7 £50,000 – £99,999 3.0 Up to £50,000 0.8 Rathbone Brothers Plc Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 8 Strategy and business performance Strategy andbusinessperformance share asmarketconditionsallow consistent growthinearningsper income, deliveredbysteadyand with agrowingstreamofdividend Our aimistoprovideshareholders and trustees to privateindividuals,charities tax andpensionadvisoryservices investment management,trust, of high-quality, personalised Our aimistobealeadingprovider and rewardorganic growth andtoencourage of Rathbones, share intheequityandprofits a commitmentforallstaffto career environment,involving an interestingandstimulating Our aimistoprovidestaffwith Shareholders Clients Employees

• • • • • • • • • • • • • • • • • • •

Aspire toearnaveragerevenuemarginsofapproximately Deliver onclientacquisitionopportunitieswhich enhance Act asafairemployertoallstaff Share ideasandbestpracticethroughouttheorganisation Provide extensive trainingforalllevelsofstaffseekingthe Offer share-basedincentivestostaffacrossthebusiness Implement executive andinvestmentmanagerremuneration Maintain optimalcapitallevelshavingregardtomarket Conservatively managetreasuryassetswithinclearrisk Continue toinvestinsystemsandITdeliverongoing Closely managecostgrowthinlinewithsteady earnings persharewithintwoyearsandfitourculture private clients Tax, trustandfinancialplanningservicesoffered toour client investment A complementaryrangeofunittruststailoredtoprivate Receiving encouragingregularfeedback fromourclients regulatory change client service,improvebusinessefficiencyandmanage Continual investmentinsystemsandpeopletoenhance banking licence In-house controlofclientcashbalancesusingourUK to investmentmanagersinmakingtheirdecisions Structured investmentprocesseswhich providesupport opportunities, minimisinginvestmentcostsforclients Selecting fromthefullrangeofavailableinvestment services toclientsatacompetitivecost Continued focusonprovidingdiscretionaryinvestment through timelyconsultationandcommunication highest professional standards deliver shareholdervalue structures which arestructuredtomanagebusinessriskand and regulatorypressuresgrowthopportunities based guidelines cost efficiency in thebusinessovertime 1% onfundsundermanagement How weachieve it How weachieve it How weachieve it

• • • • • • • • • • • • • • • * 4 Staffleavers,excluding redundanciesand retirementsasa%ofopening 3 2 Netnewfundsundermanagementas a%ofopeningfundsundermanagement 1 Netorganicnewfundsundermanagement asa%ofopeningfunds •

Maintained dividendpershareat42pinspiteof Earnings persharefromcontinuingoperationsdown30.6% Invested £3.3millionincapitalexpenditure tosupport Restructured definedbenefitpensionbenefitstoa Reduced otheroperatingexpenses by£1.8millionfrom vs32.3% Achieved anoperatingmarginof25.2%in2009 Completed atransactionwithLloydsBankingGroup Share IncentivePlan(SIP) Introduced anSAYE scheme inadditiontotheexisting with 2008 consistent 11,000 hoursoftrainingdeliveredin2009, vs6%in2008 Staff turnoverof3%in2009 market volatility from67.57pto 46.87p in2009 in2008 business efficiencyandclientservice date to65 andmovedthe normalretirement after 1July2009 Career Average Prevalued Earningsbasisforservice to£84.3million millionin2008 £86.1 interest margin followinganexpected reductioninnet in 2008 in October 1 April2010 UnitTrustRathbone Managementwitheffect from Appointment ofMikeWebb aschief executive of Management clientstojustunder34,000 Investment Growth of8.3%inthenumberRathbone – Acquiredfundsundermanagementgrowthof5.8%including – Netorganicgrowthof6.7% conditions inthefirsthalf InvestmentManagementinspiteofdifficultmarket Rathbone Total netorganicandacquiredgrowthratesof12.5%in BalancedIndex up12.7%) and FTSE APCIMS (FTSE 100Index29.0% from31December2008 up22.1% up Limited were£12.16billionasat31December2009, InvestmentManagement Funds managedbyRathbone £13.10 billion,up25.2%comparedwith31December2008 Total funds under management as at31 wereDecember 2009 Continuing verylowinvestmentmanagerturnover Highlights in2009 Highlights in2009 Highlights in2009 2007 2005 and2006 includes resultsofoperationsdiscontinuedin2009, full timeequivalentstaff Profit beforetaxfromcontinuingoperations asa%ofoperatingincome under management include results of operations discontinued in 2008 and2009 include resultsofoperations discontinuedin2008 £381 millionfromatransactionwithLloydsBankingGroup £381

Key performanceindicators Key performanceindicators Key performanceindicators 2009: 3 2009: 2005: 11 11 2006: 2007: 8 6 2008: 2009: 12.16 2009: % funds undermanagement investment management Net organicgrowthin 2009: 1,346,948 2009: Pence continuing operations Earnings persharefrom 2005: 8.28 10.38 2006: 2007: 11.23 9.43 2008: 2005: 986,463 1,136,132 2006: 2007: 1,270,641 1,290,392 2008: 2009: 46.87 2009: % All staff turnover 2005: 60.13 76.622006: 2007: 77.79 67.572008: 2009: 29,468 2009: 2005: 35,298 44,7202006: 2007: 47,302 42,306 2008: 2009: 6.7 2009: 2005: 5.8 7.22006: 2007: 7.8 7.42008: £’000 continuing operations Profit beforetaxfrom £bn funds undermanagement Investment management SIP participants SIP Number ofsharesheldby * * * * * *

Operating margin % staff turnover Investment manager % % funds undermanagement investment management acquired growth in Total netorganicand 2009: 12.5 2009: 2009: 0.0 2009: 25.2 2009: 2009: 42 2009: 2005: 5.8 18.1 2006: 2007: 9.2 11.0 2008: 2005: 2.7 3.4 2006: 2007: 1.3 1.8 2008: 2005: 31.2 33.5 2006: 2007: 35.2 32.3 2008: 2005: 30 35 2006: 2007: 41 42 2008: Pence Dividend pershare * * * 4 3

Rathbone Brothers Plc 9 Strategy and business performance Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 10 Business review Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis statements which aremadebythedirectorsingoodfaith This businessreviewcontainscertainforward-looking of commerciallysensitiveinformation. prospects, withoutprejudicingtheconfidentialnature business and to provideabalancedpictureofRathbones’ guidance providedbytheAccountingStandardsBoard This businessreviewhasbeenpreparedinlinewith other partyorforanypurpose. to itsshareholdersandshouldnotberelieduponbyany BrothersPlctoprovideinformation prepared byRathbone forward lookingstatements.The businessreviewhasbeen regulatory andbusinessriskfactors,underlyinganysuch due totheinherentuncertainties,includingeconomic, the businessreviewshouldbetreatedwithsomecaution their approvalofthisreview. Statementscontainedwithin based ontheinformationavailabletothemattimeof

market rallydrivingtheFTSE 100Index to provedmorepositivewith astrong of 2009 around 3500intheperiod.The secondhalf andlows reached highsofaround4600 of thebankingcrisis.The FTSE 100Index markets struggledtodigesttheuncertainties washighlyvolatileas The firsthalfof2009 correlated withtrendsinfinancialmarkets. Investment Management’sresultsare As aninvestmentmanager, Rathbone Business environment 2 1 Indices respectively. Balanced FTSE 100andtheFTSE APCIMS to 22.1%and12.7%increasesinthe This compares seen atthebeginningof2008. £12.16 billion,recoveringback tolevelslast management grew29.0%overtheyearto Investment Managementfundsunder 5413 at31December2009. portfolios tomeet otherfinancialrequirements, clients withdraw capitaland/orincomefrom fund outflowswhich naturally occurbecause conditions. Netorganicgrowth (stated after creditable performancegivenmarket which was avery £1.56 billionin2008 of £1.31billionwere16.0%down onthe from newclients.Grossorganic inflows managers, eitherfromexisting clientsor new fundsbroughtinbyexisting investment Organic inflowsrepresenttheamountof 4 3 2 1 Funds undermanagement under management management funds organic growthininvestment Underlying rateofnet Investment Management Table 1.Key performanceindicatorsfor income basispointreturn Average netoperating at 31December under management Table 2.InvestmentManagement–funds Investment Management quarterly billingdates(seeTable 4) reserves dividedbytheaveragefundsundermanagementon Net operatingincome(seeTable 3)excluding interestonown See Table 2 Net organicnewbusinessasa%ofopeningfundsundermanagement Organic inflowslessoutflows Impact ofmarketmovementsandrelativeperformance Value atthedateoftransfer in/out organic growth Underlying rateofnet Net organicnewbusiness As at31December Market adjustment Outflows – acquired – organic Inflows As at1January 1 1

4 1 2 1

2 3

£12.16bn 95bps (0.68) 12.16 6.7% 6.7% 1.86 0.63 1.55 0.55 1.31 9.43 2009 2009 £bn

£9.43bn

104bps

11.23

(3.04 (0.73 7.4% 7.4%

0.83 9.43 0.41 1.56 1.97 2008 2008

£bn

) ) has not repeated in 2009. has notrepeatedin2009. which, asexpected,interest incomein2008 largely asaresultofexceptionally highnet This is management decreasedin2009. The overallbasispointreturnonfundsunder 903). (2008: it hasadvisedincreaseby4.2%to941 uponwhich saw thenumberofnewSIPPs Pensionarea. Rathbone &AdvisoryServices important partofourgrowthstrategyinthis in anumberofkeyproviderpanelsremainsan Growth remainspositiveandourparticipation from £225millionatthestartofyear. 24.0% to£279 millionat31December2009 increasedby SIPP under theRathbone Investment Management held withRathbone funds The valueofSIPP 31 December2009. managed grewby4.4%intheyearended the Budget,howevernumberofportfolios changes totaxationrulesforhighearnersin businesswasundoubtedlyimpactedby SIPP of 2008. growing to4,276 at theend from3,406 with thenumberofIFA-linked accounts IFA-sourced growthcontinuedtobestrong, at thesametimelastyear. comparedto£1.1billion 31 December2009 under managementwere£1.5billionat all partsofourbusiness.Charityfunds We arecontinuingtoseegrowthacross challenging marketconditions. were alsoatexpected levelsin spiteofthe at normallevelsandaccountclosures Group transaction.Outflowsoffundscontinued millionfromtheLloydsBanking to the£381 under managementduringtheyear, inaddition £413million)offunds £165 million(2008: managers whojoinedusrecentlyadded rate of6.7%.Acquiredgrowthfrominvestment which translatesintoanannualised growth or closetheiraccount)was£631million,

resulted frompositivenetinflowsoffunds This largely to£55.8millionin2009. 2008, £54.3 millionintheyearended31December Net fee incomeincreasedby2.8%from 4 3 2 1 returns onshareholdercashremain verylow. and to £1.1billionat31December 2008 compared £0.8 billionat31December2009 continue tosee.Clientliquidity fell to unprecedented interestrateenvironment we exceptionally lowthoughreflectingthe Bank ofEngland.Secondhalfincomewas emergency baseratecutsmadebythe remained strong,benefitingfromthethree Interest incomeinthefirsthalfof2009 number oftradingopportunities. the sortofvolatilitythatgeneratesagreater yearsseeing £28.2million)withboth (2008: wasmarginallyhigherthanlastyear 2009 Commission incomeof£28.7millionin 4.0% upcomparedto£10.14billionin2008. quarterly billingdateswas£10.55billion,some funds undermanagementonthesame whilst average the averageof5227in2008, when clientsarebilled)was10.0%downon FTSE 100Index of4706 (basedon in2009 offset lowermarketlevels.The average under managementthroughouttheyearwhich Financial performance paid tointroducers Underlying operating%margin Profit beforetax Compensation Scheme levy Financial Services Transaction costs Amortisation ofclientrelationships before tax Underlying profit expenses Underlying operating Net operatingincome Interest andotherincome Commission Net fee income – Average – 31December September – 30 June – 30 – 5April Valuation datesforbilling – averagefundsundermanagement Table 4.InvestmentManagement – financialperformance Table 3.InvestmentManagement by netoperatingincome Investment Managementprofitbeforetaxand exceptional itemsdivided See Table 5 on clientaccounts Interest andotherincomeispresentednetofinterestexpense paid Net fee income is stated after deducting fees and commission expenses

1 2 4 30.9% 104.3 (72.1

10.55 12.16 11.23

29.2 32.2 19.8 28.7 55.8 2009 (0.2 (0.8 (2.0 9.69 9.11 2009 £m £bn

) ) ) )

37.2% 113.9 10.49 (71.5 10.14 10.75 39.7 42.4 31.4 28.2 54.3 2008 (1.4 (1.3 9.43 9.87 2008

£m £bn

– ) ) )

Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis Rathbone Brothers Plc 11 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 12 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis into otherassetclassesinthelatterhalfof ascashwasreinvested at 31December2008 comparedto10.4% at 31December2009 Cash represented6.3%ofclientportfolios Controls oversalaryincreaseshaverestricted business growth. levelsinspite of been keptat2008 means thatunderlyingbusinesscostshave £0.2million).Adjusting for theseitems (2009: levies included £1.4millioninrespectofFSCS costs 2008 acquired growthlevelsin2008. amortisation charge resultingfromstrong £0.7 millionincreaseintheintangibleasset associated withtheLloydstransaction,anda included £0.8millionoftransactioncosts anincreaseof1.2%.Costs in2009 2008, £75.1 million,comparedto£74.2 millionin were Investment Managementfor2009 Total operatingexpenses inRathbone 2 1 a resultoflowernetinterestincome. almostwhollyas £113.9 millionin2008 £104.3 milliondecreased8.4%from of Net operatingincomefor2009 the year. which hasincreased thecostofscheme. gilts. This effect haslargelyreversedin2009, valuesagainst which materiallyreducedbond marketsinthelastquarter corporate bond lower thanexpected asaresultofdifficult performance was Index. In2008, APCIMS a performanceelementagainst theFTSE Index. Funds-based growthawards include outperformance againsttheFTSE APCIMS reward stronglevelsoforganicgrowthand by higherawardsinschemes designedto levels, howeverthispositiveeffect wasoffset decreased asexpected inlinewithlowerprofit variablestaffcosts expansion. Some as increasesyear-to-yearreflectbusiness fixed staffcostincreasestominimallevels – operatingexpenses Table 5.InvestmentManagement Underlying cost/incomeratio Operating expenses Transaction costs Amortisation ofclientrelationships Compensation Scheme levy Financial Services Underlying operatingexpenses Other operatingexpenses Total staffcosts – variable – fixed Staff costs Investment Management divided byoperatingincome levy, amortisationofclientrelationshipsandtransactioncosts Operating expenses beforeFinancialServicesCompensationScheme involved inclientfacingactivities Represents thecostsofinvestmentmanagersandteamsdirectly 1 1 2 continued 69.1%

39.1 75.1 72.1 33.0 13.9 25.2

2009 0.8 2.0 0.2 £m

62.8% 38.2 33.3 13.6 24.6 71.5

2008 74.2

1.3 1.4 £m

–

charities andtrusteesremainsanimportant management servicestoprivateinvestors, leading providersofdiscretionaryinvestment Management’s reputationasoneofthe Investment benefit fromsolidgrowth.Rathbone business remainsstrongandcontinuesto In spiteofrecentmarketconditions,the Outlook ultimate costremainsuncertain. likely tobeincurredinfutureyearsandthe originally expected. Further levycharges are thanwas costs ofGovernmentborrowing years,which disclosedlower and 2009/10 guidance onexpected leviesfor the2008/9 followingadditional costs werelowerin2009 Financial ServicesCompensationScheme 44.9%). (2008: expenses in2009 largely fixedandwere43.9%oftotaloperating central supportservicescosts.These are depreciation, settlement,IT, financeandother Other operatingexpenses include property, comparedto429in2008. in2009 438 Average fulltimeequivalentheadcount was asset valuesclimbed. somewhat significantlyinthesecondhalfas markets. However, themarketrecovered investors lostalotofconfidenceinequity as redemptionlevelsremainedhighand continued tosuffer intheearlypartof2009 The retailassetmanagementsector Business environment 1 seen in2011. transaction withLloydsBankingGroupwillbe organically. The fulleffect oftherecent we continuetoseeopportunitiesforgrowth challenging yeargiveninterestrateconditions, asset. Whilst 2010willundoubtedlybea Unit Trusts Table 6.Key performanceindicatorsfor in fundsundermanagement Underlying rateofnetgrowth at 31December Funds undermanagement Unit Trusts See Table 7 1 £0.94bn (22.3)% 2009

£1.03bn (12.2)% 2008

“We stronglybelievethatclients “Private clientswanttobetreated “We donotsellproducts–we Relationships and advisers.” individuals, theirfamilies long-term relationshipswith investments andweaimtobuild person whoismanagingtheir value havingdirectaccesstothe their bestinterests. manage theirinvestmentsin as individualsandtrustusto an importantdistinction. offer aservice.For us,thatis views onRathbones’ keystrengths. investment managers andtheir Financial Times thatfeatured Charity Financeand the in The Times, The DailyTelegraph, theme witharangeofexecutions aimed tobuildonthis in 2009 Rathbones’ advertisingcampaign advertising campaign Rathbones’ 2009 “ Liverpool L31NW Registered ofﬁ and regulatedbytheFinancialServicesAuthority Rathbone InvestmentManagementLimitedisauthorised Edinburgh ExeterK London BirminghamBristolCambridgeChic www discretionary est Rathbones isoneoftheU Discretionary investmentmanagement d 020 7 Investment Manager David Bassett meet ourclients’ portfolios thatreally enables ustobuild all assetclasses. best providersacross investments fromthe are freetosource At Rathboneswe av ablished providersofhigh-quality id.ba .rathbones.com 39 ssett@ra 9 008

ce: P investment managementservices. 8 th . RegisteredinEnglandnumber1 ort ofLiverpoolBuilding,PierHead, bone endal LiverpoolWinc s.c om K’s largestandlongest-

, personalised

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Rathbone Brothers Plc 13 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 14 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis

Chip IncomeandGrowthFund. The Rathbone Blue Fund wasmergedintotheRathbone HighIncome and rebalanced.The Rathbone In thesummer, thefundswererestructured year period. second quartileperformancefortheone Income Fund) improvedslightly, demonstrating Performance ofthelargestfund(theRathbone million. totalling £130 first halffollowingthelossoftwomandates redemptions, which largelyoccurred inthe of £0.1 billion offsetsome£0.2ofnet start oftheyear. Positive marketmovements from£1.03billionatthe 31 December2009 Funds managedfell 8.7%to£0.94billionat 3 2 1 * some earlysignsofimprovement. market, andperformanceoverallisshowing fund restructuringswerewellreceivedbythe RecoveryFund.the relaunched The Rathbone Special SituationsFund weremergedtocreate Smaller CompaniesFund andtheRathbone Table 9.UnitTrusts –fundperformance Table 8.UnitTrusts –funddetails as thefundwaslaunched on13July2009 Recovery Fund* Income Fund Global OpportunitiesFund Ethical BondFund and GrowthFund Blue ChipIncome Quartile rankingover: Table 7. UnitTrusts –fundsundermanagement Unit Trusts Net inflowsasa%ofopeningfundsundermanagement Impact ofmarketmovementsandrelativeperformance Valued atthedateoftransfer in/out Performance RecoveryFund isnotyetavailable datafortheRathbone Other Recovery Fund Special SituationsFund Smaller CompaniesFund Growth Fund Blue ChipIncomeand Income andGrowthFund High IncomeFund Income Fund Global Opportunities Fund Ethical BondFund Underlying rateofnetgrowth As at31December Market adjustments – outflows – inflows Net outflows As at1January 1 1 continued 2 Morningstar 1 year Fund Stars

n/a 3 2 1 1 2 n/a n/a (22.3)% 1 4 3 3

(0.34 (0.23 3 years 0.94 0.14 0.11 1.03 2009 31 Dec £bn n/a 2009 503 935 193 £m 69 42 52 76 4 1 4 3

) )

(12.2)%

1,029 31 Dec 5 years (0.38 (0.63 (0.23 1.89 1.03 0.15 2008 2008 269 544 n/a £bn 36 54 24 34 16 52 £m

4 1 4 3

) ) ) management roseslightlyto1.3% as apercentageofaveragefundsunder Annualmanagementcharges in 2008. from£1.45billion billionin2009 to £0.88 reduction inaveragefundsundermanagement This change2009. isinlinewiththe39.3% to£11.6millionin 31 December2008 from £17.7 millionintheyearended Annual managementcharges fell 34.5% 1 to 0.9%in2008. compared management was0.9%in2009 a percentageofaveragefundsunder in thefunds.Netoperatingincomeas as aconsequenceofcontinuedredemptions 4.0%) operating incomeintheyear(2008: dealingprofitsconstituted5.2%ofnet box pressure fromfundsupermarkets.Managers’ reflectingthecontinued pricing in 2008, income was45.7%comparedto44.1% percentage ofannualmanagementcharge Rebates andtrailcommissionpayableasa mandates inthefirsthalfof2009. 1.2%)reflectingtheloss ofthe (2008: Financial performance 2 1 Operating %margin Profit beforetax Operating expenses Net operatingincome commission payable Rebates andtrail Initial commissionpayable Interest andotherincome Net dealingprofits Annual managementcharges Initial charges netofdiscounts Table 10.UnitTrusts –financialperformance Table 11.UnitTrusts –operatingexpenses – variable – fixed Staff costs Total staffcosts Cost/income ratio Operating expenses Other operatingexpenses Unit Trusts profitbeforetaxdividedbynetoperatingincome Operating expenses asa%ofnetoperatingincome(seeTable 10) involved ininvestmentordistributionactivities Represents thecostsofinvestmentmanagersandteamsdirectly 1 2 1

98.7% 1.3% 13.1 11.6 2009 2009 (5.3 (0.1

(7.6 0.1 0.1 0.4 1.0 2.1 1.8 3.7 3.9 7.7 7.6 £m £m

) ) )

80.8% 19.2% (10.1 10.1 12.5 20.4 2008 2008

17.7 (0.1 (7.8 2.8 6.2 3.4 3.9

2.4 1.3 0.5 0.9

£m £m

) ) ) “We prideourselvesonbeingfree “This independentstatusiskey “Rathbones isanindependent, “ We arenotrestrictedonwhat to ourphilosophy. listed company. investments.” including fundsandalternative full universeofopportunities, look acrossthemarket atthe assets weselectforclientsand investment productsand to buythemparticularproducts. our clients’behalfwithnoobligation to make investmentdecisionson Independence seal ofapproval. awarded theClearEnglish Standard for investorsare–and ithasbeen that explainswhatthe options Discretionary InvestmentManagement Rathbones’ offersaGuideto to offerthis. which firmshaveagenuineability Distribution Reviewhighlight Retail 2010 astheissuesraisedby provision ofinvestmentservicesin continue tobeakeythemeforthe Unrestricted investmentchoice will Investment Management Guide toDiscretionary

Rathbone Brothers Plc 15 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 16 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis redundancies made in the latter part of 2008 redundancies madeinthelatterpartof2008 largelyasaresultof £2.8 millionin2008, were25%lowerthanthe year ended2009 Fixed staffcostsof£2.1millionforthe Successful actionshavebeentakeninthe Outlook to 2008. operating costshavefallen17.9% compared fees intheyear. Excludingthese items,other to fundmergers,redundanciesandrecruitment include£0.5millionofcosts inrelation 2008, have reducedby5.1%from£3.9millionin whichOther operatingexpenses in2009, been recognisedbytheendof2009. cost ofawardsfrommoreprofitableyearshad asmostofthe expected toreduceafter2009 The effect ofspreadingprioryearawardsis variable costs. of deferred profitshareawards on2009 The followingtabledemonstrates theimpact in previousyearswhenprofitsweregreater. costsasawardsweresignificantlyhigher 2009 employees. The effect hasbeentodistort spread overtheserviceperiodsofrelevant to prioryearprofitshareschemes which are Variable staffcostsincludeinrelation compared to31lastyear. equivalent headcountwas24during2009 Average fulltime and theearlypartof2009. the medium-term. business which hastheabilitytogrowin is anexciting newdevelopmentforthe executive witheffect from1April2010 The appointmentofMikeWebb aschief is nowonastablefootingtodevelop. in linewithrevenuelossandthebusiness tomanageprofitability business in2009 variable staffcosts of profitbeforetaxandtotal deferred profitshareasa% Variable staffcostsexcluding deferred profitshare Variable staffcostsexcluding adjustment Deferred profitshare Total variablestaffcosts Table 12.UnitTrusts –variablestaffcosts Unit Trusts

continued 21.1% (1.4) 2009 0.4 1.8 £m

29.3%

2008 (1.7 1.7 3.4 £m

) • business. Itcomprises: core discretionaryinvestmentmanagement andcloselyalignedwithour wholly intheUK The continuingbusinessisconcentrated International FinanceB.V. wasdisposedof. containedwithinRathbone and theloanbook InternationalFinanceB.V.control Rathbone theGroupceasedto On 12November2009, on 31March 2009. Virgin Islandstrustoperationswerecompleted andthesaleofSingaporeBritish 2009 management wascompletedon10February The saleofourGenevatrustoperation toits Business environment 1 lower levelsofactivitybasedfees. reflectingslightly to£4.7millionin2009 2008 Operating incomefell from£4.9millionin 1 satisfactorily in2009. Both ofthesebusinesseshaveperformed • Operating %margin Trust andTax Table 13.Key performanceindicatorsfor Operating %margin Loss beforetax Discontinued operations continuing operations Profit beforetaxfrom Operating expenses Net operatingincome Table 14.Trust andTax –financialperformance which providesadvisoryservicesto the familyofficeservicebasedin London Trust andTax capital taxplanningservices. individuals andtrusts,providesincome Liverpool which preparestaxreturnsfor the taxationservicesbusiness,basedin administration andtaxationplanning; substantial familygroupsincludingtrustee Trust andTax netoperatingincome(seeTable 14) Trust andTax profitbeforetaxfromcontinuingoperationsdividedby operating income Trust andTax profitbeforetaxfromcontinuingoperationsdividedbynet 1 1

4.3% 2009 (0.4 (0.6 (4.5 0.2 4.7 2009 £m 4.3 % ) ) )

(10.0 4.1% 2008 2008

(9.8 (4.7 0.2 4.9 4.1 £m

) ) )

“We workhardtoprovideaconsistent clientsentrusttheirassets “Over 30,000 “We arefocusedonproviding and oneinwhich wecontinuetoinvest.” cost totheclientremainsachallenge expectations efficientlyatareasonable relationships andmeetingclient underpins successfullong-termclient that high-qualityadministration standardised feerates.We believe service cost-effectivelyfortransparent, grown ourbusinessaroundtheirneeds. have theirinterestsatheartand to Rathbonesbecausetheyknowwe and trustees. services toprivateclients,charities management andwealth high-quality, personalisedinvestment Operational excellence IFA relationships. forthegrowthofour important andbond providerswhich are SIPP an increasingnumber ofthirdparty the marketplace,such asworkingwith adapt rapidlytochanging needsof Westandards. havebeenableto and themaintenanceofhighquality over thewayweserveourclients allows usagreaterdegreeofcontrol Managing ouradministrationinhouse A flexibleservice for ic Serv advisers es Services Management Investment Discretionar

Rathbone Brothers Plc 17 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 18 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis

A fullreconciliationofincometaxexpense of prioryears. funds fromLloydsandadjustmentsinrespect expenditure, arisingontheacquisitionofclient due principallytotheeffect ofdisallowable standardrateof28.0% the compositeUK The ishigherthan effective rateoftaxin2009 £42.3million). of £29.5million(2008: before incometaxoncontinuingoperations £13.4million)dividedby theprofit (2008: charge oncontinuingoperationsof£9.3million 31.7%),calculatedasthe totaltax (2008: The effective taxratefortheyearis31.5% taxation servicesbusinessorganically. in familyofficeservicesandseektogrowour We anticipatecontinuingtodevelopandinvest Outlook 31.9%). (2008: of totaloperatingexpenses in 2009 costs which arelargelyfixed,andwere37.8% settlement, finance,ITandothersupport expenses representproperty, depreciation, Otheroperating comparedto43in2008. 40 Average fulltimeequivalentheadcount was compare tocostsof£2.8millionin2008. Fixed staffcostsof£2.5millionfor2009 1 accounts. is includedinnote9totheconsolidated Cost/income ratio Operating expenses Other operatingexpenses Total staffcosts – variable – fixed Staff costs Table 15.Trust andTax –operatingexpenses Trust andTax Taxation in client Represents thecostsoffee earningstaffandteamsinvolved facing activities 1 1 continued 95.7% 2009 4.5 1.7 2.8 0.3 2.5 £m

95.9% 2008 4.7 1.5 3.2 0.4 2.8

£m

Intangible assetscreatedbytheacquisition its operations. not relyonthewholesalemarkettofund remainswellcapitalisedanddoes Rathbones calculating itsoperationalriskcomponent. component andthebasicindicatorapproach to approach tocalculatingitsPillar Icreditrisk hasadoptedthestandardised Rathbones (see note12). and 1.2timesbyunderlyingearningspershare 1.1 timesbyreportedbasicearningspershare 42.0p) fortheyear. This dividendiscovered This resultsinatotalpayment of42.0p(2008: 2010 which willreplacethefinal dividend. interim dividendof26.0pbepaidon31March the Boardisrecommendingthatasecond and paid toshareholderson7October2009 An interimdividendof16.0ppersharewas website atwww.rathbones.com. disclosureisgivenonour PillarIII Rathbones’ from LloydsBankingGroup. millionoffundsunder management of £381 inrespectofthe acquisition December 2009 of £11.7millionhavebeenrecordedat31 reported inthebalancesheet.Intangibleassets reduce capitalheadroomassoontheyare allowable forcapitalresourcepurposessodo Lloyds BankingGrouptransaction,arenot of fundsundermanagement,such asforthe Capital Dividend

“Many ofourclientrelationshipsare “Our highstaffretentiongivesclients “We valueourpeopleandare “Rathbones isalong-established, of generations.” and mayhavelastedforanumber with severalmembersofonefamily remain withusforyearstocome. Rathbones theyknowandtrustwill confidence thattheindividualsat committed todevelopingtheirskills. and permanence. built astrongreputationforquality leading investmentmanagerthathas Stability of ourname. investors areattracted bythequality andvolatility that of uncertainty brand hasservedus wellinaperiod that thestrengthofRathbones’ professionals andclients.We believe of bothinvestmentmanagement from anextremelylowturnover Rathbones continuestobenefit Established 1742

Rathbone Brothers Plc 19 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 20 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis with anyclients’cashnotheldonasegregated surplus liquidityonitsbalancesheettogether Investment ManagementholdstheGroup’s As alicenseddeposittaker, Rathbone • cash flowsduringtheyearwereasfollows: cash flows,themostsignificantnon-operating banking/treasury operations.Excludingthese are principallygeneratedfromtheGroup’s modest workingcapital.Largercashflows operates with client portfolios,Rathbones As fee incomeislargelycollecteddirectlyfrom instalments endingon4April2011. balance isrepayableinsix-monthlyequal Barclays BankPLC £9.2million).The (2008: from of £6.2millionat31December2009 arelimitedtoaterm loanfacility borrowings not anticipatethatthiswillchange. External funding tofinanceitsoperationsanddoes doesnotrely onwholesale markets Rathbones As anetproviderofliquiditytothebanking appropriate. regularly reviewedtoensureratingsremain must beAratedorhigherbyFitch andare wide numberofcounterparties.Counterparties appropriate instrumentsissuedbyarelatively The treasurydepartmentinvests inarangeof financial statements. as setoutinnote28totheconsolidated exposure tomarket,creditand liquidityrisk, an approvedtreasurymanualandmonitors in accordancewithproceduressetout the BankingCommitteetoBoard,operates Investment Management,reportingthrough The treasurydepartmentofRathbone client moneybasis. • Treasury andfinancing dividends of£18.1million Cash outflowsrelatingtothepaymentof Cash flow (2008: £11.3million) (2008: £3.3 millionofcapitalexpenditure £17.5(2008: million)

the next sevenyearstofundthescheme’s contributions of£3.1millionannuallyfor The Boardhasapprovedaschedule of on page88. are includedinnote25totheaccounts valuation andassociatedsensitivities assumptions supportingtheaccounting Detailsofthe in thesecondhalfof2009. from thesignificantequitymarketrecovery hasbenefited deficit at31December2009 purposes aremorecloselyaligned.The reportingandfunding prepared forboth normal levelscurrently, such thatvaluations deficits.Spreadsareatmore reported IFRS which artificiallyreducedthe end of2008, wereveryhighatthe rated corporatebonds £5.7million).Spreadson15yearAA (2008: defined benetschemes totalled£9.4million the combinedaccountingdeficitfortwo pension scheme. At 31December2009, to newmembers)andadefinedcontribution ofwhichpension schemes areclosed (both operatestwodefinedbenet Rathbones used at31December2009. year andformsthebasisofassumptions Scheme wassubstantiallycompletedinthe A triennialvaluationoftheLaurenceKeen wereunaffected bythechanges.1 July2009 to 65.Benefitsinrelationserviceprior age ofthescheme wasalsochanged from60 basis.The normalretirement Earnings (CARE) final salary, butonaCareer Average Revalued no longeraccruebaseduponamember’s From thatdatebenefitsforfutureservicewill were amendedwitheffect from1July2009. 1987 definedbenefit scheme, scheme benefits In ordertomanagetheincreasingcostsof 1987 Scheme. £2.3million)intotheRathbone (2008: regular contributionsof£3.6million committed. Duringtheyear, theGroupmade annum overthenext fouryearspreviously deficit, inadditionto£0.4millionper Pensions

“Internal performancemonitoringand “The Process supportsmanagers “The RathboneInvestmentProcess are achieved.” and fulfilmentofclientobjectives the appropriatequalityofservice risk controlprocessesensurethat more traditionalinvestmentchoices. alternative investmentsaswell of investmentoptions,including in theirchoice ofagrowingrange for individualclients. latitude todecideonthebeststructure allowing investmentmanagersthe to drawon,butisnonprescriptive guidance forinvestmentmanagers provides structureandwell-researched Skill of allourinvestment managers. combines theintellectual capital Rathbone Investment Processwhich We have continuedtoinvestinthe The Rathbone Investment Process • • committee Stock selection Strategic assetallocationcommittee Fixed income equities UK

• • committee funds Management Unit trusts trusts Investment

• • • • • committee assets Alternative Property Private equity Commodities products Structured Hedge funds

Rathbone Brothers Plc 21 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 22 Business review Investment Management Unit Trusts Trust and Tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis comprising 3i’scoreRhymesightprocessing infrastructure. Ourintegratedcoresystems, has continuedtoprovidearobustoperations informationtechnology department Rathbones’ smoothly, andourthanksgoout toallinvolved happens Banking GroupintoRathbones the Portfolio ManagementServiceofLloyds ensure thatthetransfer ofnewclientsfrom Operations teamshavebeenworkinghardto • • • • • • • • more significant examples have been: our businessanditsefficiency.Some ofthe our businesssupportsystemstodriveforward developments inourinvestmentsystemsand There havebeenalargenumber ofdifferent on thesystem. expansion andincreaseddata demands toprovidecapacityforbusiness in 2009 reporting package, wereupgraded significantly Investment DeskandEquipos’STR client engine, theinternallydevelopedRathbone market investmentchoice. we areabletoprovideclientswith awholeof associated withthisapproach toensurethat to supporttheeverincreasingcomplexity when appropriate.Operationally, wecontinue commodities, privateequityand propertyfunds products andinvestmentintoareassuch as fundofhedgefunds,structured and bonds, to ourclientsincludingtraditionalequities means thatweprovideafullrangeofassets generate ‘index’ returnsovershortperiods.This different clientneeds,anddoesnotaimto offers bespokesolutionsfor Rathbones in thisprojectfortheircontinuedcommitment. Operations andresources Upgrading ourSunaccountingsystem. improving firewalls accessand by locking downUSB Increasing investmentindatasecurity facilities forIFAs layout, charts, e-mailcapacity, andmore Investment intoclientreporting,withnew our newunitisedmultiassetservice Infrastructure supportforthelaunch of FSA requirements A telephonerecordingcapabilitytomeet documentation managementsystem Significant background workonanewclient keep usupwithanevolvingmarket trading) withnewcounterparties,which andAlgorhythmic mechanisms (DMA successful introductionofnewdealing Dealing InfrastructureReview–the the business upgrade coreMicrosoftsystemsacross Office2007MS –amajorproject to

The significantnon-financialrisksthatface statements. note 28totheconsolidatedfinancial management ofthoserisks,aresetoutin and proceduresforthemonitoring Financial risks,togetherwiththepolicies advance ofleasebreakopportunitiesin2012. to considerourLondon location in2010 our Chichester officeinJune, we expect manage costscarefully. Havingrelocated use ofspaceaspartouroverallplansto We willcontinuetoworkhardsecureoptimal our MicrosoftExchange server capacity. London andLiverpoolsignificantly upgrade in ourVoice telephone technology in overIP In 2010weplantocompleteamajorupgrade secure futureefficiencies. continue toinvestinourcoreprocesses and overseassettlementrates,will This yearweachieved ourbesteverCREST when necessary. staff arereviewedregularlyand updated contracts ofemploymentforall fee earning employment ofatrainingmanager and and developmentissupportedby the packages remainappropriate.Stafftraining benchmarking, weensurethatremuneration recruiting highqualitystaffand,throughregular Recruitment policiesstresstheimportanceof the business. to developdistributionchannels forallpartsof marketing andoperationalresourcetocontinue in earnings.Investmentismaintainedthe where webelieveitwillcontributetogrowth enhancing orbroadeningtheservicesoffered in which itoperatesandtheGroupinvestsin monitors developmentsinthemarketplaces variety ofneeds.The businesscontinuously robust, flexible andcapableofmeetinga InvestmentProcess remains the Rathbone the peopleandresourcesrequiredtoensure To mitigatethisrisk,wecontinuetoinvestin professionals. distribution, orthelossofkeyinvestment inadequate investmentinmarketingor to changes anddemandsinthemarketplace, poor performanceorservice,failuretorespond clients orfailuretogainnewdue and thereforethereisariskoflossexisting operatesinacompetitive market Rathbones Competition risk are: Rathbones Risks anduncertainties

to implementthosechanges. and plantoensurewehavesufficientresource impact anychanges mayhaveonourbusiness We monitorregulatorychanges, assessthe could adverselyaffect profitability. a riskthatchanges in,oradditional,regulation fines orotherdisciplinaryaction. There isalso with regulatoryrequirementscouldleadto operate isheavilyregulated.Failure tocomply The financialservicessectorinwhich we Regulatory risk the Group’scompliancedepartment. This ismonitoredbyinternalauditorsaswell of Treating ClientsFairly. Financial ServicesAuthorityandtheprinciple the Training andCompetenceregimeofthe all relevantregulationandstatutes,inparticular places significantemphasisoncompliancewith first classservicetoourclients. The Groupalso throughout thebusiness,onprovisionofa standards, andfosteringastrategicfocus, the highestpossibleprofessional andethical building onourestablishedcultureofseeking This riskismitigatedbypreserving and regulatory censureleadingtonegativepublicity. including poorperformanceorservice,and Reputational riskcouldariseformanyreasons new clients,which wouldlead to financialloss. the lossofexisting clientsand failuretogain significant damagetoreputationcouldlead management services.There is ariskthat provider of investment management and wealth hasareputationashighquality Rathbones Reputational risk total equity (2008: £9.2million). The Company total equity(2008: which represents3.4%of 31 December2009 has anunsecuredtermloanof£6.2millionat financial statementsshowsthattheCompany Pillar 3disclosuresannually. Note21tothe stress scenarios.The Company publishes which includethemodellingof certainextreme performs annualcapitaladequacyassessments The Companyisregulatedby the FSAand credit riskandliquidityrisk. of itsfinancialinstrumentsand exposure to financial riskmanagementobjectives,details the financialstatements explains theGroup’s policies formanagingitscapitalandnote28to statements includestheGroup’sobjectivesand 10 to23.Inaddition,note29thefinancial described inthebusinessreviewonpages facilitiesarealso position andborrowing position oftheGroup,itscashflows,liquidity set outinthebusinessreview. The financial development, performanceandpositionare with thefactorslikelytoaffect itsfuture The Group’sbusinessactivities, together 12 months. Company’s prospectsforaperiodexceeding their view, thedirectorshaveconsidered the annualfinancialstatements.Informing going concernbasisofaccountinginpreparing foreseeable future,theycontinuetoadoptthe to continueinoperationalexistence forthe that theCompanyhasadequateresources As thedirectorshaveareasonableexpectation economic andpoliticaloutlook. successfully despitethecurrentuncertain well placedtomanageitsbusinessrisks The directorsbelievethatthecompanyis turmoil, andthisisexpected tocontinue. management inspiteoftherecentmarket generate organicgrowthinclientfundsunder theGrouphascontinued to In 2009, continue tofinanceitsoperations. is notreliantontherenewalofdebtfacilitiesto Going concernbasis

Investment Management Unit trusts Trust and tax Taxation Dividend Capital Treasury and financing Cash flow Pensions Operations and resources Risks and uncertainties Going concern basis Rathbone Brothers Plc 23 Business Review Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 24 Directors Directors Chairman Executive directors Non-executive directors Directors at31December2009 7 4 1 13 10 5 8 2 5 11 14 12 6 9 3 15 chairman Plc. ofNXT member ofFamily and AssuranceFriendly Society the BoardinDecember2001.Heisacommittee Limited andTenon Group Plc.Hewasappointedto Privatesubsequently chief Bank executive ofEFG and & Williamson to1995, fortenyearsfrom1985 in1975.KPMG) Hewaschief executive ofSmith accountant withPeat, Marwick, Mitchell &Co.(now IT SteeringCommittee.Hequalifiedasa chartered and marketingisalsochairman oftheGroup’s He isthedirectorresponsibleforriskmanagement responsible foritspensionsandadvisorybusiness. Group’s Trust andTax businessandthedirector Ian Buckley, aged59,ischief executive ofthe 3 Investment Managers&Stockbrokers (APCIMS). plc andadirectoroftheAssociationPrivate Client the seniorindependentdirectorofBeazleyGroup became chief executive inOctober2004.Heisalso and He wasappointedtotheBoardinAugust1999 investment managementandprivatebankingdivision. venture capitalistandlatterlyfinancedirectorofthe with KleinwortBensonasacorporatefinancier, hespentover13years inJuly1999, Rathbones Prior tojoining Marwick, Mitchell &Co.(nowKPMG). He qualifiedasa chartered accountantwith Peat, andEnvironmentalCommittee. the Group’sSocial manages theday-to-dayaffairsofGroupand He ischairman oftheExecutiveCommitteewhich Andy Pomfret, isthechief executive. aged 49, 2 chairman oftheNominationCommittee. and amemberoftheTakeover Panel. Heis Investment Managers&Stockbrokers (APCIMS) chairman oftheAssociationPrivate Client chairman ofSVM ActiveFund Plc.Heisaformer chairman inMay2003.Heisalsonon-executive Hewasappointedas acquisition inMarch 1995. managing directoroftheGroupfollowingits Boardas and wasappointedtotheRathbones hejoinedLaurenceKeen aschief executive1989 CL-Alexanders Laing&Cruickshank Holdings.In Lyonnais Securitiesandwaschief executive of heworkedinwhatbecameCredit to1989 1968 for privateclientsthroughouthiscareer. From He hasbeeninvolvedininvestmentmanagement independent forthepurposesofCombinedCode. andisnotconsideredtobe from 1January2008 He movedtoanon-executive rolewitheffect principal responsibilityforthestrategyofGroup. Mark Powell, aged64,isthechairman with 1 Andy Pomfret* Executive directors Mark Powell Chairman Ian Buckley*

portfolios. Hehasspenthisentireworkingcareerat Liverpool. Healsomanagesalargenumberofclient in Aberdeen,Birmingham,Edinburgh,Kendal and InvestmentManagementbusiness for Rathbones’ Andrew Morris,aged45,isthedirectorresponsible 6 Board inMarch 1996. investment managementandwasappointedtothe toconcentrateonprivateclientdiscretionary in 1992 responsible forpensionfunds.HejoinedtheGroup wherehewastheBoardmember Group Plcin1986 Initially with Laurence Prust, he moved to Framlington investmentmanagementbusiness. for Rathbones’ Richard Lanyon,aged58,isthedirectorresponsible 5 was appointedtotheBoardinSeptember2001. of NatWest Portfolio ManagementinBristol.He role beforejoiningtheGroupin2001wasashead client businessesofNatWest andCoutts,hisfinal merged withGartmore.After aperiodintheprivate management armofNatWest, which waslater started hiscareerworkingfortheinstitutionalfund operations, ITinfrastructureandfacilities.He officer responsiblefortheGroup’sinvestment Paul Chavasse,aged45,isthechief operating 4 * and wasappointed totheBoardinSeptember2008. Pearl inAugust2008 Group.HejoinedRathbones in Brusselsandasadivisionfinance directorofthe he leftin2005andhassinceworked forEuroclear Following thesaleofGerrardtoBarclaysin2003, director ofGerrardLimitedeightmonths later. becoming directoroffinancein2001 andfinance joined OldMutualPlcasgroupfinancialcontroller, he In1999 PricewaterhouseCoopers in1992. He qualifiedasa chartered accountantwith Paul Stockton, aged44,isthefinance director. 9 Alternative AssetCommittee. Board inNovember2000.Hechairs theGroup’s Hewasappointedtothe in1995. by Rathbones priortoitsacquisition joined LaurenceKeen in1988 portfolios. HavingtrainedwithCountyBank,he Jersey. Healsomanagesalargenumberofclient Investment ManagementbusinessinLondon and responsibility, themanagementofGroup’s Richard Smeeton,aged45,has,ashisprincipal 8 the Boardon31March 2010. Managers, theunittrustdivision.Heisretiringfrom director andmanagingofGartmoreFund for Gartmore14yearswherehewasagroup heworked in1999, 2005. BeforejoiningRathbones Limited. HewasappointedtotheBoardinJanuary chief UnitTrust executive ofRathbone Management unittrustbusinessandis responsible forRathbones’ Peter Pearson Lund, aged62,isthedirector 7 and Training andCompetenceCommittees. He ischairman oftheGroup’sBusinessContinuity and wasappointedtotheBoardinNovember2000. inprivateclientinvestmentmanagement Rathbones Andrew Morris Richard Lanyon* Paul Chavasse* Members oftheExecutive Committee Paul Stockton* Richard Smeeton Peter Pearson Lund

Chairman Executive directors Non-executive directors Rathbone Brothers Plc 25 Directors Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 26 Directors Chairman Executive directors Non-executive directors senior partner in 1992. Herelinquishedthisrolein senior partnerin1992. partners ofSJBerwinLLP andwasmade in1982, David Harrel,aged61,wasoneofthefounding 10 Novae Groupplc.Heisachartered accountantand Oliver Corbett,aged45,isgroupfinancedirectorof 13 Remuneration Committee. independent. Sheischairman ofthe Board inNovember2003andisconsideredtobe Investment Trust Plc.Shewasappointedtothe She isanon-executive directorofTRProperty Criminal IntelligenceServiceuntilMarch 2006. authority fortheNationalCrimeSquadand until June2000andwasamemberoftheservice director ofThe ScottishMetropolitanProperty Plc Shewasalsoa until1999. investments from1990 Plc whereshewasexecutive directorincharge of spent 26yearswithGuardianRoyalExchange figure withintheassetmanagementindustry. She isahighlyexperienced Caroline Burton,aged60, 12 Meeting on5May2010. retiring fromtheBoardafterAnnualGeneral and isconsideredtobeindependent.Hewill He wasappointedtotheBoardinNovember2003 Limited, aleadingWest Endinternationalartdealer. Trust PLC andadirectorofThos. Agnew’sandSons non-executive chairman ofM&GEquityInvestment of itsauditcommitteeforfouryears.Currently, heis DebtManagementOfficeandwas chairman UK Plc. In2000hewasappointedasanadvisertothe chairman andchief executive ofCaterAllenHoldings in thefinancialservicesandbankingsectoras James Barclay, aged64,hasmanyyears’experience 11 as the senior independent director in December 2008. is consideredtobeindependent.Hewasappointed appointed totheBoardinDecember2007 and Duffield andJohnAspinall Foundations. Hewas English NationalOperaandatrusteeoftheClore Group Limited,amemberoftheBoard director ofWichford Plcandchairman ofThe Kyte a variety of other appointments: he is a non-executive andisnowaconsultanttothefirm.Davidhas 2006 Committee inDecember2008. He wasappointedaschairman oftheAudit andisconsidered tobeindependent. March 2006 in October2003.HewasappointedtotheBoard emerging companies,beforejoiningNovaeGroup Wasserstein, wherehewasmanagingdirector, Donaldson Lufkin Jenrette)andDresdnerKleinwort Warburg,worked forSG PhoenixSecurities(later David Harrel Non-executive directors Oliver Corbett Caroline Burton James Barclay

Meeting on5May2010. down fromtheBoardafterAnnualGeneral considered tobeindependent.Hewillstepping andis appointed totheBoardinMarch 2006 consultant withMarakonAssociates.Hewas Group andalsospentnineyearsasamanagement four years.HepreviouslyworkedfortheNatWest officer ofGartmoreInvestmentManagementPlcfor Morgan Cruciblein2004hewaschief financial of The MorganCrucibleCompanyplc.Prior tojoining Mark Robertshaw, aged41,ischief executive officer 15 the CombinedCode. considered tobeindependentforthepurposesof Investments plc,anditisrecognisedthathenot He isadirectorofmajorshareholder, Caledonia He wasappointedtotheBoardinDecember2007. private equityinvestmentandconsultancybusiness. of HambrosBank,andsubsequentlywithhisown Hambro CountrywidePlcandanexecutive director Group, wherehewasjointmanagingdirectorof including morethan20yearswiththeHambros and investinginlistedunlistedcompanies, years’experience inadvising,managing over 30 at CaledoniaInvestmentsplcsince2003.Hehas John May, aged54,hasbeenanexecutive director 14 Mark Robertshaw John May Governance

Directors’ report Corporate governance report Remuneration report Audit committee report Nomination committee report Corporate responsibility report Statement of directors’ responsibilities in respect of the report and accounts Rathbone Brothers Plc 27 Governance Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 28 Directors’ report Directors’ report amount to £18,159,000 (2008: £17,984,000)amount to£18,159,000(2008: –seenote11onpage78. register on5March 2010.This 42.0p)perordinarysharefortheyear. resultsintotal dividendsof42.0p(2008: These dividen 0.0p)ispayableon31March andasecondinterimdividendof26.0p(2008: 2010toshareholdersonthe paid on7October2009 The directorsdonotrecommendthepaymentofafi The Groupprofi Details ofeventsafterthebalancesheetdatearesetoutinnote33toaccountsonpage106. Post balancesheetevents environmental, employeeandsocialcommunityissuesaresetoutintheCorporateresponsibilityreportonpages47 to55. A fullreviewoftheGroup’sbusinessactivitiesaresetoutinonpages10to23.Informationabout Business review planning services. administrationandotherfi PensionRathbone &AdvisoryServicesLimitedoffers apensionadviceservice,SIPP in Genevaon10February andinSingaporeBVIon31March 2009 2009. withcompletionofthesaleoffshoretrustbusinesse offshoretrustbusinesseswascompletedinearly2009 of Rathbones’ TrustRathbone The sale CompanyLimitedprovides awiderangeoftrust,companymanagementandtaxationservicesintheUK. RetailScheme.a NonUCITS MultiAssetPortfolio, includingtheRathbone Corporate DirectorofanumberOpenEndedInvestmentCompanies(OEICs) UnitTrust managessevenauthorisedunittruststhroughRathbone Rathbones ManagementLimitedandistheAuthorised adviser tofi banking services.The companyalsooffers GreenbankInvestments)andistheinvestment anethicalinvestmentservice(Rathbone InvestmentManagementLimitedisauthorisedandregulatedbytheFinancialServicesAuthorityprovidesprivate Rathbone Investment ManagementLimitedfromelevenoffi The Group’sprincipal activityisdiscretionaryinvestmentmanagementforprivateclients,charities andtrustscarriedoutby clients. The Groupalsoprovidesfi and relatedprofessional advicetoprivateindividuals,trustees,charities, pensionfunds andtheprofessional advisersofthe BrothersPlcistheparentcompanyofagroupcompanieswhichRathbone offers arangeofinvestmentmanagementservices Group activities resolution ofshareholders. the CombinedCode,Companies Actsandrelatedlegislation.AmendmentoftheArticles Associationrequiresaspecial Regarding theappointmentand replacementofdirectors,theCompanyisgovernedbyCompany’s ArticlesofAssociation, up to2.0millionsharesundercertainstringentconditions. Theguidance issuedbytheAssociationofBritishInsurerson31December 2008. Boardcurrentlyhastheauthority tobuyback withtheauthoritytoallotafurther 14.0millionsharesbywayoffullypre-emptiverightsissuesinlinewith 3 March 2009) The Boardcurrentlyhastheauthoritytoallot14.0millionshares(approximately one-thirdofthe issued sharecapitalat provisions oftheArticlesAssociationandprevailinglegislation. There arenospecifi general meetings.Allsharesarefullypaid. The 42,858,196). sharescarrynorightsto fi were inissue(2008: shares The Company’ssharecapitaliscomprisedofoneclassordinaryshares5p each. 43,296,330 At 31December2009, Capital structure Group resultsandCompanydividends ve venture capital trusts. In addition, the Rathbone Groupcontinuestoprovide someadvisorystockbroking services. ve venturecapitaltrusts.Inaddition,theRathbone t after taxation for the year ended 31 December 2009 was £19,628,000 (2008: £19,000,000). was£19,628,000(2008: t aftertaxationfortheyearended31December 2009 c restrictionsonthesizeofashareholdingortransfer coveredbythe ofshares,which areboth nancial planning,privatebanking,offshorefundmanagementandtrustadministrationservices. ces in the UK and by Rathbone InvestmentManagementInternationalinJersey. andbyRathbone ces intheUK nal dividend (2008: 26.0p).The fi nal dividend(2008: xed incomeandeach sharecarriestherighttoonevoteat rst interim dividend of 16p (2008: 16.0p)was rst interimdividendof16p(2008: nancial se Rathbone Rathbone ds s to him.The Boardconsiders that,withtheexception ofMarkPowell andJohnMay, allnon-executive directorsareindependent. The seniorindependentdirectorisDavidHarreland anycommentorenquiryregardingtheaffairsofCompany maybeaddresse of FidelityAsianValues Plc. Santander GlobalAdvisersandBaringAssetManagement.She isanon-executive directorofHermesFund ManagersLimitedand (ex Japan)forFidelityInternational.Prior tothat,sheheldseniorappointmentswithWilliam MMercer, AXAInvestmentManage Kathryn Matthews’entirecareerhasbeenininvestmentmanagement,mostrecently aschief investment offi Holdings Limited. executive Sheiscurrentlychairman directorwithKelda ofOpenwork Groupplcuntilitssaletoaninfrastructurefundin2008. latterlyasgroupexecutive directorforwealthmanagement.Shealsoservedasanon- foreightyearsuntilJanuary2009, board Bank Trust CompanyandBarclaysStockbrokers. ShesubsequentlyjoinedLegal andGeneralGroupPlcservedonitsmain Kate Avery’s careerbeganwithBarclaysPlc,wheresheworkedforsomeeighteenyears,andwas managingdirectorofBarclays to stepdownfromtheBoardatAnnualGeneralMeetingon 5May2010. Kate Avery andKathryn MatthewswereappointedtotheBoardon6January2010whilstJamesBarclayandMarkRobertshaware John MayandMarkRobertshaw. Their biographiesareonpage26. The directorswithnon-executive responsibilitiesareMarkPowell, JamesBarclay, CarolineBurton,OliverCorbett,DavidHarrel Board on31March 2010. Peter Pearson Lund, Richard SmeetonandPaul Stockton. Their biographiesareonpage25.Peter Pearson Lund istoretirefromt The directorswithexecutive responsibilitiesareAndyPomfret, IanBuckley, Paul Chavasse,Richard Lanyon,AndrewMorris, Executive directors ordateofappointmentiflater * Table 1.Directors’shareholdings shown inTable 6onpage41. in Table 1.There werenochanges and23February between31December2009 2010.Detailsofdirectors’shareoptionsare The directorsatthe yearendandwhoservedduringtheyear, andtheirinterestsinthesharecapitalofCompanyareshown Directorsandtheirinterests Meeting and,beingeligible, offer themselvesfor re-election. Caroline Burton, Richard LanyonAndrew Morris,AndyPomfret andRichard Smeeton retirebyrotationatthenext AnnualGeneral Retirement andre-appointmentofdirectors arl8–8– – – – – – – 8 1,480 2,437 – 1,437 – 3,183 3,183 – 379 – – – – – – – – – 116,475 91,490 – 50,070 – 1,480 27,159 2,008 8 212,052 33,056 – 51,411 12,500 – 1,008 2,674 2,674 – – – – 251,397 – – 115,928 68,443 41,523 M Robertshaw 11,612 12,500 211,505 J MMay D THarrel 31,055 O RPCorbett 40,865 C MBurton J CBarclay 302,350 Non-executive R PStockton R ISmeeton A DPomfret P GPearson Lund A TMorris R PLanyon P DGChavasse I MBuckley Executive G MPowell Chairman Non-executive directors Number of5pordinaryshares Benefi at 1January2009* ca Non-benefi cial ca Benefi cial Number of5pordinaryshares at 31December2009 ca Non-benefi cial cer, AsiaPacifi c

, rs, cial he d

Rathbone Brothers Plc 29 Directors’ report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 30 Directors’ report represented 13 days of annual purchases (2008: 30 days).Therepresented 13daysofannualpurchases Companyitselfhasnotradecreditors. 30 (2008: daysoftheirinvoicedate.Tradewith suppliersareforpaymentwithin30 subsidiaries at31December2009 creditorsoftheUK and abidesbythemsubjecttotheresolutionofanydisagreementregardingsupply. Inthemajorityofcases,termsagre supplier inaccordancewithitsrequirementsandfi doesnotfollowapublishedcodeorstandard onpaymentpractice.Itspolicyistofi Rathbones Policy onthepaymentofcreditors 2001 andaSaveAsYou EarnScheme which wasapprovedbyshareholderson19November2009. aShareIncentivePlanlaunchedThe in Companyencouragestheinvolvementofitsemployeesinperformancethroughboth involvement practicescanbefoundintheCorporateresponsibilityreportonpages53to55. Details oftheCompany’semploymentpractices,itspolicyregardingdisabledpersonsandemployee found intheCorporateresponsibilityreportonpage55. nil).DetailsoftheCompany’scharitableNo contributionsweremadeforpoliticalpurposesduringtheyear(2008: donationsca Political andcharitable donations Table 2.Substantialshareholdingsat23February 2010 Transparency Rule5.1.2ofthefollowinginterests3%ormoreinvotingrightsCompany. At 23February 2010,theCompanyhadreceivednotifi Substantial shareholdings by wayofdeed. refl on2May2007,At theAGM shareholdersapprovedchanges totheCompany’sMemorandum andArticlesofAssociationto case islost). company, pensionfundor sharescheme. The legislationalsopermittedthefundingofdefence costs(which arerepayableifthe default, breach ofduty orbreach oftrust(butnotcriminalfi any liabilityincurredbythemtoperson(otherthanthecompany orassociatedcompany)inconnectionwithanynegligence, On 6April2005changes tocompany lawcameintoeffect which allowedcompaniestoindemnifyitsdirectorsandoffi The riskmanagementobjectivesandpoliciesoftheGrouparesetoutinnote28 totheaccountsonpages93104. Financial instrumentsandriskmanagement ect theseprovisions. Specifi Indemnifi 3.02% 3.50% 5.04% 3.12% 3.96% 14.69% 1,290,701 1,477,812 3.04% 8.82% 2,173,950 1,700,574 1,344,818 2October2007 Employees 6,358,765 15March 2007 3,817,000 1,314,465 17November2009 23January2009 13October2009 2February 2010 18February 2010 9December2009 SpecialSituationsFund BlackRock UK Royal BankofScotlandplcasTrustee ofthe EmergingCompaniesHedgeFund BlackRock UK Mawer InvestmentManagementLtd. Lloyds BankingGroupplc Legal &General Group Plc Lindsell Train Ltd. Caledonia Investmentsplc BlackRock Inc. Notifi er cation ofdirectors c indemnities,which areuncapped, havebeengrantedtoalldirectorsandthecompanysecretary nancial procedures. Rathbones ensuresthatsuppliersareawareofthoseterms nancial procedures.Rathbones cations inaccordancewiththeFinancialServicesAuthority’sDisclosureand nes orregulatorypenalties)inrespectofthatcompany, associated Date ofnotifi cto riaysae %ofvotingrights Ordinaryshares cation x termsofpaymentwitheach cers against cers ed n be

to establishthattheauditorsareawareofinformation. are unawareandthateach directorhastakenallreasonablestepstomakehimselfawareofanyrelevantauditinformationand The directorsinoffi the directorstosettheirremunerationwillbeproposedat2010AGM. Audit Plchaveindicatedtheirwillingnesstocontinueinoffi KPMG AuditPlcbereappointed. has recommendedtotheBoardthatexisting auditors,KPMG auditors’ remuneration.Havingreviewedtheindependenceandeffectiveness oftheexternal auditors,theAuditCommittee monitoring theGroup’suseofauditorsfornon-auditservices.Note7tofi The AuditCommittee reviewstheappointmentofexternal auditorsandtheirrelationshipwiththeGroup,including to£11.34). £6.965 (2008: to£9.60 was £6.68 £8.335)andtherangeduringyear was£8.00(2008: The midmarketprice oftheCompany’ssharesat31December2009 Share price Registered Offi 23 February 2010 Company secretary Richard Loader By OrderoftheBoard and availabletoanswerquestions. It isanticipatedthatalldirectors,includingthechairmen ofthe Audit,RemunerationandNominationCommittees,willbeatt Company to28February 2010willbefi To on31March 2010,interimaccountsofthe avoidasimilarissuewiththepaymentofsecondinterimdividendfor2009 release andwaivertoprotectdirectorsshareholdersagainst anyfutureclaim. the Companyproposestoreleaseandwaiveanysuch toapprovesuch claims.Resolutions willbeputtoshareholdersattheAGM approved thepayments.Inordertoputshareholdersanddirectors intothepositioninwhich theywerealwaysintendedtob for repaymentoftherelevantdividendsfromshareholderswho receivedthosedividendpaymentsand/orfromthedirectorswho This technical non-compliancewiththetermsofCompaniesActscould,intheory, resultinarightfortheCompanytoclaim of dividendpaymentsmadehaveexceeded thedistributableprofi ‘relevant accounts’foreach dividendpaymentwouldthereforebedeemedtotheCompany’spriorannualaccountsandanumber the dividendtoshareholders,ithasnotalwaysfi Registrar ofCompanies.Whilst theCompanyhasalwaysbeensatisfi latest interimaccounts.Inordertorelyonaccountspayadividendcompanymustfi company. For thepurposesofCompaniesActs‘relevantaccounts’areeitheracompany’slastannualauditedaccountsor Distributions madebyacompanymustnotexceed thedistributableprofi A technical irregularityregardingthehistoricpaymentofdividendsbyCompanyhasbeenidentifi new ArticlesofAssociationfollowingthefullimplementationCompaniesAct2006. withnotlessthan14days’noticeisproposedastheadoptiono authority toconveneageneralmeeting(otherthantheAGM) purchases subjecttolimits).The ofordinarysharesundercertainstringentconditions(both annualspecialresolutionseeking The Boardarealsoseekingtorenew, byspecialresolution,theexisting authoritiestowaivepre-emptionrightsandmakema and toallotupafurther14.2millionsharesforfullypre-emptiverightsissues. renew theexisting authoritytothedirectorsallotup14.2millionshares(withanaggregatenominalamountof£71 The resolutionsproposedincludeanordinaryresolutionclassifi The noticeofthemeetingisonpages114to120withdetailsresolutionsproposedandexplanatoryW1S 2UD. notes. The 2010AnnualGeneralMeetingwillbeheldonWednesday 5May2010at12.00noon159 NewBondStreet,London, Special business Annual GeneralMeeting Auditors Audit PlcwereappointedasauditorsfollowingtheresignationofPricewaterhouseCoopers LLP on27May2009 ce: 159 NewBondStreet, London W1S 2UD ce atthedateofsigningthisreportconfi led at Companies House in accordance with Section 838 oftheCompaniesAct2006. led atCompaniesHouseinaccordancewithSection838 led therequisiteinterimaccountswithRegistrar ofCompanies.The appropriate ce andordinaryresolutionsreappointingthemasauditorsauthorising ed bytheArticlesofAssociationasnon-routine specialbusinessto rm thatthereisnorelevantauditinformationofwhich theauditors ts oftheCompanyreportedinthoseannualaccounts. ed thatithadsuffi ts asreportedinthelastsetof‘relevantaccounts’ ofthe nancial statementssetsoutdetailsofthe cient reservesatthedateofpayment le thoseinterimaccountswiththe ed. KPMG he AGM he AGM the 0,000)

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Rathbone Brothers Plc 31 Directors’ report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 32 Corporate governance report Corporate governancereport subsidiary companies. statements, companyacquisitionsanddisposals,majorcapital expenditure of andthereviewofdecisionstakenbyboards include determinationoftheGroup’saimsandstrategytobe adoptedinachieving thoseaims,reviewsofbudgetsandfi The Boardhasaformalschedule ofmattersreservedforitsattention,which coverskeyareasoftheGroup’sbusiness. These or executive directorsorwhich remainunresolvedafteranapproach throughthenormalchannels. director isDavidHarrelwhoavailabletoshareholdersifthey haveconcernsthattheywouldrathernotaddresstothechair management actionsandperformance,includingresourcingstandardsofconduct.The seniorindependentnon-executive they needtoperformtheirduties.They bringanindependent judgementtobearonGrouppoliciesandstrategiesaswell The non-executive directorsparticipatefullywiththeirexecutive colleaguesinBoardmeetingsandhaveaccesstoanyinformat andJohnMay,(as explained above) whoisadirectorofmajorshareholder, CaledoniaInvestmentsplc. The Boardconsidersthatsevenoftheninenon-executive directorsareindependent,theexceptions beingMarkPowell chief executive fortherunningofbusinessandimplementationBoardstrategypolicy. by theBoard.The chairman isprimarilyresponsiblefortheworkingofBoardanditsdevelopmentstrategy The rolesofchairman, MarkPowell, andchief executive, AndyPomfret, areseparatedandclearlydefi The Boardcurrentlyconsistsofanon-executive chairman, eightexecutive directorsandeightothernon-executive directors. held. The non-executive directorshaveinformalmeetingswithoutthechairman orchief executive present. formal Boardmeetingisscheduled, aninformalmeetingofthenon-executive directorsandthechairman andchief executive is The Boardmeetsaminimumofseventimesperannumwithonemeetingdevotedentirelytostrategicissues.Inmonthswhereno of theCodetargetdiffi within theoperatingsubsidiariesonBoarddoesresultinasizeablenumberofexecutive directors,makingtheachievement excludinghalf theboard, chairman, shouldbeindependentnon-executive directors.The numberofseniorpractitionersfrom There arecurrently 17directors,ofwhich seven(41%)areindependentnon-executive directors.The Coderequiresthatatleast (Provision A.3.2) Composition oftheBoard executive director oftheCompanysince1995. The chairman didnot,onappointment,meettheindependencecriteriasetoutinCodesincehehadbeenanemployeeand Independence ofthechairman onappointment(Provision A.2.2) throughout theyear: the CompanywasincompliancewithSection1ofCodethroughoutyearfollowingtwoexceptions which applied supporting principleshavebeenappliedaresetoutintheGovernancesectionsofreportandaccounts.The directorsbeliev ExplanationsofhowtheCodeprinciplesand andappliesforreportingperiodsbeginningonorafter29June 2008. (‘FRC’) bytheFinancialReportingCouncil The revisedCombined CodeonCorporateGovernance(‘theCode’)wasissuedinJune2008 The CombinedCodecompliancestatement 23 February 2010. In relationtocompliancewiththeCombinedCodethisreporttogetherDirectors’statespositionat Corporategovernancereport Board membership Board meetings Board cult. ned inwritingandagreed nancial man e ion and keybusinessprocesses. This includesmeeting staffinanumberofkeybusinessareas,attendanceatroutinemeetingsanddemonstrationssystems New directorsareinvolvedinathoroughinductionprocessdesignedtoenablethembecomequickly familiarwiththebusiness specifi Rathbones’ standards forthisexceed regulatoryrequirements.Training anddevelopmentwouldincludeactivitiestokeepupdatewith enhanced. Alldirectorsarerequiredtodedicateacertainnumberofhourstheirowndevelopment–internallyestablished iscommittedtothetraininganddevelopmentofallstaffensureprofessionalRathbones standardsaremaintainedand Board training non-executive directors,ledbytheseniorindependent director, carryoutanappraisaloftheperformancechairman. chairman (forthe non-executive directors)each year andinvolvesmeetingswitheach directoronaone-to-onebasis.The Individual appraisalofeach director’sperformanceisundertakeneitherbythechief executive (fortheexecutive directors)o early 2009. duringthe‘creditcrunch’ an acquisition ofbusinessfromtheLloydsBankingGroupandoversightboard oflate2008 based corporateadvisoryfi aninternalquestionnairewasused.This2009, wasdevelopedandexecuted withassistancefromLintstock Limited,aLondon The Board,Audit and RemunerationCommitteescarryoutappraisalsoftheiroperationperformanceonanannualbasis.In Board performance Nomination Committeereport. Oliver Corbett,DavidHarrel,Kathryn Matthews,AndyPomfret andMark Robertshaw. Full details of itsrolearesetoutinthe Current membersoftheNominationCommitteeareMarkPowell (chairman), Kate Avery, JamesBarclay, Caroline Burton, Nomination Committee David Harrel,Kathryn MatthewsandMarkRobertshaw. Full detailsofitsrolearesetoutintheRemunerationreport. Current membersoftheRemunerationCommitteeareCarolineBurton(chairman), Kate Avery, JamesBarclay, OliverCorbett, Remuneration Committee Kathryn MatthewsandMarkRobertshaw. DetailsofitsworkaresetoutintheAuditCommitteereport. Current membersoftheAuditCommitteeareOliverCorbett(chairman), Kate Avery, JamesBarclay, CarolineBurton,DavidHarrel, Audit Committee The ExecutiveCommitteemeetsmonthlyandmorefrequentlywhenrequired. on acontinuingbasisandtoanalyseplanallbusinessproposalsindetailforsubmissionconsiderationbytheBoard Richard LanyonandPaul Stockton. The purposeoftheExecutiveCommitteeistomonitoreveryaspect Groupbusinesses The ExecutiveCommitteeischaired bythechief executive, AndyPomfret, andcomprisesIanBuckley, Paul Chavasse, Executive Committee These areavailableonrequestfromtheCompany’sregisteredoffi The otherBoardCommitteeshaveformaltermsofreference, which arereviewedandapprovedbytheBoardonanannualbasis. delegated fullauthoritytotheExecutiveCommittee,subjectalistofmatterswhich arereservedfordecisionbythefullB The fourprincipalBoardCommitteesaretheExecutive,Audit,RemunerationandNominationCommittees.The Boardhas Board Committees c issuesandindustry, marketandregulatorychanges. reviewaswellconsideringthe rm. This year’squestionnairefolloweduponpointsraisedinthe2008 ce andontheCompanywebsite. oard. r . d .

Rathbone Brothers Plc 33 Corporate governance report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 34 Corporate governance report and onthewebsite. Votes aretakenonashowofhands(unlesspoll isrequested)andfulldetailsofproxy votingfi welcomes questionsandcomments fromshareholders. Every effortismadetoensurethat allBoardmembers,andinparticularcommitteechairmen, areatthemeeting.The Board proper considerationoftheresolutionsbyshareholders.Separate resolutionsareproposedforeach substantiallyseparateissu isgiven toallowtimefor opportunity tomeetnon-executive At least20businessdays’noticeoftheAGM directorsattheAGM. directors includingnon-executive directors.Feedback fromthesemeetingsisreported totheBoard.Allshareholdershave Meetings withmajorshareholdersprovideanopportunitytodiscuss governanceandstrategyissuestointroduceother packs usedandanywebcastsarealsoonthewebsite. and fullyearresults,presentationsaregiventomajorshareholders, fundmanagers,analystsandemployees.The presentation announcements, pressreleasesandfi The Companyiscommittedtoensuringthatthereeffective communicationwithallshareholders. Allregulatorynews Scheduled monthlymeeting # Scheduled bi-monthlymeeting * rules andregulationsapplicabletotheCompany. AnyremovalorappointmentofthecompanysecretaryisdecidedbyBoard. expense. The companysecretaryisresponsibletotheBoardforensuringproceduresarefollowedandcompliancewith the adviceandservicesofcompanysecretarymayseekindependentprofessional advice,ifnecessary, attheCompany’s The Companyhas appropriateinsurancecoverinplacerespectoflegalactionagainstitsdirectors.Anydirectorhasaccess issues OtherBoard There aresafeguards which applywhendirectorsdecide whethertoauthoriseaconfl Shareholders approvedthenecessarychanges on7May2008. totheCompany’sArticlesofAssociationatAGM Articles ofAssociationtocontainotherprovisionsfordealingwithdirectors’confl confl interest thatconfl (‘theAct’)toavoidasituationwherehehas,orcanhave,directindi A directorhasadutyundertheCompaniesAct2006 A registerofactualorpotentialconfl The directorsare alsoabletoimposelimitsorconditionswhengivingauthorisation. decision thedirectorsmustactinawaywhich theyconsider, ingoodfaith,willbemostlikelytopromotetheCompany’ssucce directors (thosewhohavenointerestinthematterbeingconsidered)areabletotakerelevantdecision,andtaking Shareholder relations meo / – – 2/2 1/2 – – 1/2 – – – – – 4/5 2/2 – – – 2/2 – – 2/2 – – – – – 1/2 6/7 5/5 – 5/5 – – 5/5 – – – – 12/12 4/5 – – – 6/7 7/7 – 12/12 – 7/7 7/7 – – 7/7 – 5/7 – 7/7 7/7 11/12 7/7 – – 6/7 7/7 7/7 R PStockton – 11/12 7/7 12/12 R ISmeeton 7/7 M Robertshaw G MPowell 7/7 A DPomfret 6/7 P GPearson Lund 7/7 7/7 A TMorris 7/7 J MMay R PLanyon D THarrel O RPCorbett P DGChavasse C MBurton I MBuckley J CBarclay Table meetingandcommitteeattendance in2009 1.Board Confl ict orpotentialconfl icts ofinterest icts orpossiblymayconfl ict ofinterestwheretheArticlesAssociationcontainaprovisiontothiseffect andalsoallowsthe l or*EeuieCmite ui omte eueainCmiteNominationCommittee RemunerationCommittee Audit Committee ExecutiveCommittee# Plc Board* icts notifi icts nancial reportsareavailableontheCompanywebsite.Following thepublicationofinterim ict withtheCompany’sinterests.The ActallowstheBoardtoauthoriseadirector’s ed andauthorisedismaintainedreviewedregularlybytheBoard. icts ofinteresttoavoidabreach ofduty. ict orpotentialconfl gures aredisclosed afterthevote ict. Onlyindependent

rect ss. to e.

concern basisinpreparingtheaccounts. foreseeable future(atleast12monthsfromthedateaccountsaresigned).For thisreason,theycontinuetoadopt thegoin The directorshaveareasonableexpectation thattheGrouphasadequateresourcestocontinueinoperationalexistence forthe in thebusinessreviewonpage23.Note28summariseshowGroupmanagesitsfi and revisedinOctober2005. This processmeetstherequirementsof‘GuidanceonInternalControl(The Turnbull Guidance)’publishedinSeptember1999 to allemployees. The Companyhasitsowninternal dealingruleswhich extend theFinancial ServicesAuthorityListing RulesModelCodeprovision Model code adherence tothestatutesandregulations relevanttoeach oftheGroup companies. The BoardtogetherwiththeExecutiveCommittee andtheAuditCommitteehaveimplementedsystemsprocedures toachieve Stockbrokers Limitedisamemberfi Rathbone InsuranceLimitedisregulatedbytheGuernseyFinancialServicesCommission. Rathbone InvestmentManagementInternationalLimitedisregulatedbytheJerseyFinancialServicesCommission. Rathbone Exchange Commission. InvestmentManagementLimitedisregisteredasaninvestmentadviserwiththeUSSecuritiesand Rathbone PensionRathbone &AdvisoryServicesLimitedareallauthorisedandregulatedbytheFinancialAuthority. Stockbrokers UnitTrust InvestmentManagementLimited,Rathbone Limited,Rathbone Rathbone ManagementLimitedand Regulation The company’sbusinessactivities,fi Going concern end. Necessaryactionshavebeenorarebeingtakentoremedyanysignifi andhastakenaccountofmaterialdevelopmentssincetheyear existence intheGroupforyearended31December2009 On behalfoftheBoard,AuditCommitteeconfi theAuditCommitteewhich, ontheBoard’sbehalf,examines theeffectiveness ofthesystemscontrolasexplained below. • company’spractice;and • a confi • a leveloftheriskstowhich itisormightbeexposed; defi assessmentsoftheamounts,typesanddistributioncapitalthatGroupconsiders adequatetocoverthenatureand requiredbyFSAprudentialruleswhich aninternalcapitaladequacyassessmentprocess(ICAAP) requiresregular • tobeevaluatedandvariancesactedupon; anannualbudgeting,regularforecastingandmonthlyfi • aregularbasis; whereseniorstaffoverseetheoperationofbusinesson aformalstructureofcommitteesandsubsidiarycompanyboards • The otherkeyelements oftheGroup’soverallcontrolsystemsinclude: and upto23February 2010. risks andthestepsbeingtakentocontrolormitigatesuch risks.Riskreviewprocedureshavebeeninplacethroughouttheyea ontheidentifi review ofriskwithintheGroupatitsquarterlymeetings.ItreportsonaregularbasistoBoardboth compliance andinternalaudit.This committeeisanimportantelementintheGroup’soverallcontrolsystemandundertakesa reports totheBoardandcomprisesallmembersofExecutiveCommitteetogetherwithGroupheadspersonnel, Ian Buckley isthedirectorwithspecifi non-executive directorsupontheadequacy ofthemanagementinformation. timely informationregardingcorporateandbusinessissuestoenablethemdischarge theirdutiesandcanvassestheviewsof absolute assuranceagainstmaterialmisstatementorloss.The chairman ensures thatBoardmembersreceivesuffi to manageratherthaneliminatetheriskoffailureachieve businessobjectivesandcanonlyprovidereasonablenot The Boardofdirectors hasoverallresponsibilityfortheGroup’ssystemsofinternalcontrol.However, such systemsaredesign Riskmanagementandinternalcontrol ned setofpoliciesandproceduresfortreasury operationswithlimitssetbytheBankingCommittee; dential reportingpolicy, acolleague’sorGroup which encouragesemployeestoraiseseriousconcernsabout nancial performance in 2009 andthefi nancial performancein2009 c responsibilityforriskmanagement.Hechairs theRiskManagementCommitteewhich rm oftheLondon Stock Exchange. rms thatithasreviewedtheeffectiveness ofthesystemsinternal controlin nancial reportingsystemforallGroupdivisions,which enablestrends cant failingsorweaknessesidentifi nancial position at 31 December 2009 aresummarised nancial positionat31December2009 nancial risk. nancial ed fromthatreview. cient and cient cation of cation ed g r s

Rathbone Brothers Plc 35 Corporate governance report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 36 Remuneration report of companycarsisbeingphasedoutasleasecontractsend. providesarangeofbenefi In additionRathbones the chairman andchief executive arealso taken intoconsiderationinrespectofotherBoardpositions. When settingsalarylevels,useismadeofsurveydataandinformationprovidedbytheadviserstoCommittee.The viewsof or1January2010. 1 January2009 directors’basicsalarieswerenotincreasedon In viewofthetradingconditionsexperienced and in2009, inlate 2008 the Groupasawholeandinformationobtainedoncomparablecompaniesinfi when anindividualchanges positionorresponsibility. Indecidingappropriatelevels,theCommittee considerssalariesthrough An executive director’sbasicsalaryisdeterminedbytheCommitteeandanychange implementedon1Januaryofeach yearor Basicsalaryandbenefi these arrangementsremainappropriate. profi In thelightofcurrenteconomiccircumstances,Committeehasconsideredremunerationarrangementsandrisk/reward in theseareasbyinadvertentlymotivatingirresponsiblebehaviour. when consideringtheremunerationofexecutive directorsbutitissatisfi The Committeedoesnotspecifi objectives. supports both to theBoard.The secondobjectiveismetbyprofi build upandmaintainashareholdingtotheequivalentvalueofatleastoneyear’ssalarywithinfi shareholding intheCompany, subjecttomeetingstretching performancetargets.Executivedirectorsareactivelyencouragedto The fi shareholder valueandtoincreaseprofi term. The Committeeconsidersthatthekeyobjectives ofaremunerationpackage aretomotivatedirectorsgeneratelong-term Remuneration packages aredesignedtoincludefi Remuneration packages for 2010onwardswhich areexplained below. Committee (theCommittee)hasreviewedcurrentremunerationarrangementsinlightofthesereportsandismakingsomechanges Sir DavidWalker andaFSApolicystatementtitled‘Reformingremunerationpracticesinfi sawthepublicationof‘A2009 banksandotherfi reviewofcorporategovernanceinUK Company successfully. in thefi The aimoftheremuneration policyistoprovideacompetitiveremunerationpackage, havingregardtocomparablecompanies Remunerationpolicyforexecutivedirectors The Boardpresents theRemunerationreportforyearended31December2009. Remuneration report In 2009 £345,000 waspaidrepresenting 1.2%ofcontinuingGrouppre-tax profi In2009 department concernedwhich maybesupplementedbyapayment fromthepoolreferred toabove. AndrewMorris,Peter Pearson Lund and Richard Smeeton) receivedaprofi Directorswithdirectresponsibility forinvestmentmanagement,unittrustorandtaxdepartments (IanBuckley, • £502,000 waspaidrepresenting1.7%ofcontinuingGrouppre-taxprofi In2009 inatypicalyearthepaymentwouldnormallybe1.75% ofGroupprofi contributionsofindividualparticipants andtheexternal circumstancesinwhich theCompanyhasoperated.Itwasanticipated poolofbetween1.0% and2.5%ofGrouppre-taxprofi Paul Chavasse,Richard Lanyon,AndyPomfret andPaul Stockton wereeligibleforadiscretionaryprofi • For thefollowingarrangementswereinplace: 2009, Profi le thatthesepresentatexecutive directorlevel,andarecomfortable that,withthechanges totheprofi rst objectiveismetbylong-termincentiveplan(LTIP) awards,providingdirectorswiththeopportunitytobuildameaningful nancial sector, which issuffi t share ts cally takeintoaccountcorporateperformance onenvironmental,socialandgovernanceissues cient toattractandretainthequalityofdirectorneededmanagedevelop tability. ts includinglife, privatemedicalandpermanenthealthinsurance.The provision t sharepayments.The proposedintroductionofadeferred profi xed and variable elements, and to provide rewards for both thelongandshort xed andvariableelements,toproviderewardsforboth ts atthediscretionofRemunerationCommittee,havingregardto ed thattheincentivestructuredoesnotincrease risks ts. t sharepayment basedontheprofi t (2008: £591,000,1.4%) t (2008: £591,000,1.4%) t (2008: nancial sector. nancial nancial industryentities’by nancial services’. The Remuneration ve yearsoftheirappointment t sharepaymentfroma t shareproposed, t fte ts ofthe t shareelement out

that

The Committeeis comfortablethattheoverallremunerationopportunityismoderatewhencomparedwithmarket. director isabadleaverwhilstdeferred shareswillattractthemonetaryequivalentofdeclareddividendsoverdeferral pe performance ofthebusinessandthatfurtherconditionswerenotnecessary. Halfofthedeferred awardwilllapsei No performancecriteriaareattached tothedeferred award.The Committee’sviewwasthatsharepricemovementsrefl cash. Individualawardswillbecappedat200%ofbasicsalary. The cashelement maybeincreasedbutthetotalawardwillreducedbyuptoamaximumofone-thirdifistak BrothersPlcsharesthreeyearsaftertheendofrelevantaccounting up totwo-thirdsoftheawardwillbepaidinRathbone normal yearthepercentagewouldbearound4%.This theincreaserecognisingth compareswiththetotalawardof2.9%for2009, Awards toallexecutive directorswillbemadefromonepoolofprofi those profi (and notrevenue)remainedappropriateandinaccordancewithbestpractice.Whilst thedangerofexcessive risktakingingene For 2010,changes tothestructurewillbemade.The Committee’sviewwasthatpaymentsbasedonashareofcurrentyearprofi Table 1.Directors’remuneration(auditedinformation) Profi Duringtheyear, retirementbenefi 3 Reviewedannuallyon1January 1 2 Benefi Former non-executive directors Former executive directors M Robertshaw J MMay D THarrel O RPCorbett C MBurton J CBarclay Non-executive R PStockton R ISmeeton P GPearson Lund A TMorris R PLanyon P DGChavasse I MBuckley A DPomfret (chief executive) Executive G MPowell Chairman t share ts wasconsideredlow, itwasagreed thatasignifi ts includetheprovisionofacompanycarandmedicalinsurance continued ts accruedundermoneypurchase three) schemes inrelationtothreedirectors(2008: Salary or ,2 9872 3,018 26 847 19 2,126 3 9–1154 1 – 19 134 £’000 1 61296 416 1 1 76 203 – – 219 212 8 51 285 18 85 – 182 3 9 427 309 1 1 195 76 – – 231 232 1 71270 1 57 – 212 1 5 467 1 155 – 311 165–– 0–––40 40 – – – – – – 40 40 5–––35 35 – 43 – 35 – – – – – – – – – 35 35 – 43 35 fee ––––– ––––– 1 contributions Payments in lieuof pension cant elementofdeferral shouldbeintroduced. £’000 ts of3-5%Groupprofi sharing Profi £’000 t Benefi £’000 ts 1166 – 2 2009 total 2009 t beforetaxwithanexpectation thatina £’000 2008 total 2008 3,304 446 549 166 113 314 333 378 276 £’000 474 40 40 35 35 35 35 35 – contributions Pension £’000 2009 82 21 24 37 ect the ect – – – – – – – – – – – – – 3 contributions riod. period. Pension £’000 f a rating 2008 en in ts 69 24 37 – – – 8 – – – – – – – – – – – at 3

Rathbone Brothers Plc 37 Remuneration report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 38 Remuneration report Table 2.LTIP performancetargets(2005/07 andsubsequentplans) this holdinghavebeenwaivedandvotingrightswillnotbeexercised. Dividendentitlementsinrespectof shareswere held asat31December2009. Planparticipants. 42,693 awarded to2006/08 thetrusteeheld47,193On 31December2008, 4,500shareswere BrothersPlcordinaryshares.On12March 2009, Rathbone fi a peergroupratherthanbroadindex wasruledoutduetothesmall numberofsimilarbusinessesinthespecialityandother For allawardsmadesince2005,relativeTSR performancehasbeenmeasuredagainsttheFTSE AllShareIndex. The useof for thewholeplancycle.Inallothercircumstances,anyprovisionalawardwouldlapseoncessationofemployment. cycle asawholebutthattheactualawardbereducedproratatorefl the Committeemay, atitsdiscretion,recommendtothetrusteethatanydistributionbebasedonperformanceduringpla the Company’sconsent),ill-health,redundancyordeath,anyothercircumstanceswhich theCommitteedeemstobeappropriate If aparticipantceasestobeemployedasanexecutive directorbyreasonofretirementatnormalage(orearlierwi assuming thattheyarereinvested. return (TSR). TSR isameasureoftheoverallreturntoshareholders.Itrefl andtotalshareholder award). The performancetargetsusedtodatehavebeenamixture ofgrowthinearningspershare(EPS) to which thetargetshavebeenachieved determinestheactualnumberofshares(ifany)attributabletoeach participant(thea At theendofeach plancycle,theCompany’sperformanceisassessedagainsttargetsforthatcycle.The extent of athree-yearplancycle(theprovisionalaward).The maximumvalueofaprovisionalawardis75% ofaparticipant’sbasicsa Under thecurrentLTIP arrangements,executive directorsareprovisionallyawardedrightstoacquireordinarysharesatthesta approval) arecurrentlybeingdeveloped. in 2001.NoawardsfromthecurrentplanwillbemadeafterNovember2010.Newarrangements(which willrequireshareholder At anExtraordinary GeneralMeetinginNovember2000,along-termincentiveplan(LTIP) wasapproved byshareholderstostart Long-term incentiveplan(LTIP) Equity incentives awards arediffi In practice,awardsundertheLTIP areintendedtobesatisfi 0.8%)ofthe issuedsharecapitalat31December2009. 354,142)wouldbe awarded,representing0.9%(2008: (2008: ordinaryshares maximum possibleprovisionalawardstobemadeinshares current andformerdirectors,393,346 Details oftheprovisionalawardsfor2007/09, plancyclesarealsosetoutinTable and2009/11 2008/10 3.Were the and2010/12plancycles 2009/11 2008/10, to45.55pin2009. in 2006 percentilerelative totheconstituentsofFTSE decreasedfrom76.62pCompany atthe38th AllShareIndex. BasicEPS No actualawardsweremadeforthe2007/09 plancycle.The TSR forthethree-yearperiodwas-24.84%, which ranked the 2007/09 plancycle b EPS nance sector, andtheriskthatnumberswouldfallstillfurtherduetoconsolidation. vr1%btls hn3.%Straightlineincrease Straightlineincrease Sharesdistributedas%of sharesprovisionallyawardedin 37.5% orgreater Over 15%butlessthan37.5% 15% Less than15% growthovertheplancycle EPS the75thAt orabove percentile Between the50thand75th percentiles Below the50thpercentile TSR rankingrelativetotheconstituentsofFTSE AllShareIndex a TSR growthovertheplancycle b EPS a TSR overtheplancycle cult topredictwith anyaccuracy. ed usingmarket purchased shares heldintrust.Expectedactual ect thefactthatparticipantwasnotanexecutive director ects both thechange inthesharepriceanddividends, ects both Shares distributed as % of shares provisionally awarded in the EPS part Shares distributedas%ofsharesprovisionallyawardedintheEPS the TSR part % ofaward th 100% 100% lary. rt ctual 25% 50% 50% n 0% 0% , Table 4.Awards Plan(auditedinformation) DeferredBonus heldbyPeter Pearson LundundertheRUTM is a‘good’leaver).Funds arereleasedintwoequal tranches twoandthreeyearsaftertheperiodend. trust andinvestedonbehalfofparticipants.The releaseofanawardisconditionaloncontinuedemployment (unlessthepartic A deferred profi deferred profi Limited (RUTM) Following hisappointmenttotheBoard,Peter Pearson UnitTrust Lund hascontinuedtoparticipateintheRathbone Management Long-term incentivearrangementsforPeter Pearson Lund performance comparatorforLTIP plancyclessince2005/07. FTSE AllShare–Total ShareholderReturn receipt. The FTSE AllShareIndex hasbeenselectedasacomparatoritissuitablybroadmarketindex andhasbeenusedas BrothersPlc–Total Rathbone ShareholderReturn Chart 1showstheCompany’sTSR againsttheFTSE AllShareIndex. TSR iscalculated assumingthatdividendsarereinvestedon 0 10 20 30 40 50 60 Chart1.Total overthelastfi ShareholderReturn(TSR) partwaythroughtheplancycle Rathbones The provisionalLTIP andwasreduced pro-ratator awardtoPaul plancycle wasmadeinAugust2008 Stockton forthe2008/10 provisionalawardistheaveragemid-marketpriceover20dealingdayspriortostartofplan 2 directorforthewholeplancycle.The valueoftheseawardswhenmadewas75% ofaparticipant’sbasicsalary. The marketva The provisionalLTIP arethemaximumawardsachievable assumingallperformancetargetsaremetandthat awardslistedabove 1 Equity incentives Table 3.LTIP actualandprovisionalawardsofordinaryshares(auditedinformation)

TSR% 09–4,5 8002012/13 2011/12 48,050 191,950 – – 2008/09 2009/10 861,216 – – 158,659 – 303,484 176,178 267,996 127,306 48,050 158,658 – 48,050 109,338 – – 1,081,162 – 191,950 462,55 317,317 109,338 Total 2009 2008 2007 2006 2005 Year ofaward Notes oa 0,9 4,7 143,070 18,909 £8.23 19,365 142,079 28,933 16,585 21,187 18,460 18,905 16,904 108,197 £8.43 21,187 28,247 16,192 20,685 11,259 – 14,825 18,905 20,685 £10.75 22,151 12,697 16,220 – – 14,825 16,220 £11.95 – – – – – date ofprovisionalaward Market valueofsharesat Total R PStockton R ISmeeton A DPomfret A TMorris R PLanyon P DGChavasse I MBuckley End ofperformance Date ofprovisionalaward Status Plan cycle 1Dc20 3 e 05 1Dc20 3 e 07 1Dc20 31Dec2009 31Dec2008 31Dec2007 31Dec2006 31Dec2005 31Dec2004 t sharing pool is allocated to participants on the recommendation of a RUTM PlanCommittee.Allocationsare heldin t sharingpoolisallocatedtoparticipantsonthe recommendationofaRUTM continued t sharingplanratherthantheLTIP. (£value onaward) 1 January2009 outstanding at Awards 7–––4 31 December2009 31 December2006 (£value onaward) Actual award Award made 2007/09 in 2009 ve ﬁ Maximum provisionalaward (£value onaward) nancial years Awards vesting 31 December2010 31 December2007 Awards vesting in2009 in 2009 2008/10 funds released Maximum provisionalaward (£value of 31 December2008 31 December2011 ) 31 December2009 £au naad Releasedates (£value onaward) 2009/11 lue ofsharesatthedate outstanding at theparticipantisanexecutive eﬂ 2572010/11 62,557 ect thefactthathejoined Awards Maximum provisionalaward 31 December2009 31 December2012 2010/12 ipant a

Rathbone Brothers Plc 39 Remuneration report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 40 Remuneration report in Table 6.The termsandconditionsofalloptionshaveremainedunchanged duringtheyear. Details ofoutstandingoptionsatthestartandendyeartogetherwithdetailsexercised duringtheyearare normally beexercised beforethethirdanniversaryofdategrantandexpire onthetenthanniversaryofgrant. performance conditionsintheeventofachange ofcontrolortheearlyterminationaparticipant’s employment.Optionsmay Option grantstoaparticipantintenyearrollingperiodarecappedatfourtimesremuneration.There isnoautomaticwaivin plus3%perannum(orprorata foranypartthereof). percentage termsbymorethantheincreaseinRPI immediately priortotheoptiongrantandaccountingperiodthirdanniversaryofhasincreas Options grantedafter21June2004canbeexercised iftheearningspershareofGroupbetween the accountingperiod 2% perannum(orprorataforanypartthereof). date ofnotifi Options grantedpriorto21June2004canbeexercised iftheearningspershareofGroupduringperiodfrom granttot the Board. Option grantsareonlynowbemadeinexceptional circumstancesandareno longergrantedtodirectorsaftertheirappointment Share options Table (auditedinformation) 5.The RathboneBrothersSavingsRelatedShareOptionPlan2009 of invitationlessa20%discount).DetailsgrantstodirectorsareshowninTable 5. (beingtheclosingmid-marketpriceonthreedealingdaysprecedingdate at£6.96 grant wasmadeon23December2009 (commonly knowasaSaveAsYou EarnorSAYE Plan)which Anoption wasapprovedbyshareholderson19November2009. SavingsRelatedShareOptionPlan Revenue&CustomsapprovedRathbones Executive directorsmayalsoparticipateintheHM directors’ shareinterestsonpage29. growthovertherateofinfl are alsooffered toemployeesifthereisyearonEPS shares intheCompanyandcurrentlythesearematched onaone-for-onebasisbytheCompany. shares Performance relatedSIP onthesametermsasallotheremployees.This allowsallemployeestopurch All directorsareentitledtotakepartintheSIP andSavingsRelatedShareOptionPlan(SaveAsYouShare IncentivePlan(SIP) Earn) Equity incentives tctn–61––612/20 10/30/81 696.00p 01/08/13 696.00p 01/02/13 696.00p 23/12/09 696.00p 651 01/08/13 01/08/13 01/02/13 01/02/13 01/08/13 23/12/09 696.00p 23/12/09 01/02/13 1,303 651 23/12/09 – 1,303 01/08/13 696.00p 01/02/13 – 696.00p 23/12/09 1,303 – – 01/08/13 01/08/13 01/02/13 01/02/13 – 23/12/09 23/12/09 – 1,303 1,303 – – – – – 651 – 1,303 651 1,303 – – – – 1,303 – – 1,303 – 1,303 R PStockton R ISmeeton – – A DPomfret A TMorris R PLanyon P D GChavasse I MBuckley plus cation ofexercise hasincreasedinpercentagetermsbymorethan theincreaseinRetailPrice Index (RPI) continued 1 January 2009* At At ,1 7,817 – – 7,817 – Granted in 2009 Exercised in 2009 Lapsed in 2009 31 December 2009 At At ation. SIP sharesareincludedinthetableof ation. SIP Date of grant exercise date Earliest exercise date Latest set out ase g of ed in Exercise not he price to Table 6.Outstandingshareoptionsandmovementsintheyear(auditedinformation) Equity incentives These aredisclosedseparatelyin Table 1. Additional cashpaymentsarenow madebywayofasalarysupplementinlieuwithnooverall increase incosttotheCompany. In thecaseofPeter Pearson Lund, employer pensioncontributionsanddeathinservicebenefi limits, whereapplicable. RevenueandCustomsmaximum paysannualcontributionsof11.5% ofsalarytothoseschemes,plan. Rathbones subjecttoHM arrangements underself-invested personalpensionschemes whilstPaul Stockton isamemberoftheGroupdefi Andy Pomfret andPaul Stockton participateintheScheme fordeathinservicebenefi Paul Chavasse,Richard Lanyon,AndrewMorris,Peter Pearson Lund andRichard Smeetonaremembers oftheScheme. Ian Buckley, Widows. Inthecaseofcertaindirectorsandsenior staff,theGroupcontributestotheirpersonalpensionarrangements. Since 1April2002,newemployeeshavebeenoffered membership ofaGroupdefi Details oftheCompany’scontributionsaresetoutinnote25to theaccounts. normal retirementageof65ratherthan60. at 5%).With effect futureservicebenefi from1July2009, orswitchingand to8%from1January2008) toa1/70th accrualrate for futurepensionableservice(butcontinuingtocontribu given thechoice accrualrate(butincreasingtheir contributionratefrom5%to6.5%at1Apri ofeitherremainingona1/60th foreach yearofmembership.With theaccrualratewas1/60th Prior to1April2006, employeeswere effect from1 April 2006, (the Scheme). The Scheme withapensionbasedonfi provides formemberstoretireattheageof60 1987 priorto1April2002wereoffered Pension membershipoftheRathbone employeeswhojoinedRathbones SchemeUK Pension arrangements been allottedfortheLTIP todatewithawardssatisfi 2.1%).Noshareshave allotted inrespectoftheSIP, (2008: representing 2.5%oftheissuedsharecapitalat31December2009 6.2%).1,071,167represents 5.8%oftheissuedsharecapitalatthatdate(2008: havebeen 905,367) ordinaryshares(2008: havebeengranted,which 2,649,537) ordinaryshares(2008: optionsover2,508,122 In thetenyearsto31December2009, and SIP. allotted undershareoptionschemes (includingtheSAYE theLTIP Plan)andnotmorethan5%tosharesallottedunderboth for allshareincentiveschemes operatedbytheCompanyinanyten-yearperiod.Ofthat15%,notmorethan10%appliestoshare andrightsissues)shouldbeissued Not morethan15%oftheissuedordinarysharecapitalCompany(adjustedforbonus to£11.34) £6.965 (2008: £8.335)andtherangeduring was£8.00(2008: The mid-marketclosingpriceoftheCompany’sshareson31December2009 (a) ordateofappointmentiflater * ofe 2506,0 40/31/30 40/3450p2/30 £7.440 £8.805 24/03/09 415.00p £7.440 08/05/09 814.17p 14/03/13 24/03/09 14/03/06 09/09/09 415.00p 14/03/03 09/09/02 – £8.790 £7.315 09/09/99 852.00p 14/03/13 – 14/03/06 14/03/03 31/07/09 26/11/09 15/03/15 – 415.00p 15/03/08 415.00p 15/03/05 10,000 14/03/13 14/03/13 14/03/06 14/03/06 14/03/03 14/03/03 – 813.50p – 932.50p 22/08/18 22/08/11 £8.720 10/04/10 62,500 22/08/08 10/04/03 £7.440 30,000 £8.720 10/04/00 50,000 06/11/09 12,000 743.50p 62,500 16,667 24/03/09 06/11/09 415.00p 810.00p 50,000 16/03/14 827.50p 16/03/07 932.50p Dilution 14/03/13 24/04/12 16/03/04 16,667 14/03/06 24/04/11 24/04/05 – 814.17p 10/04/10 14/03/03 25,334 24/04/04 24/04/02 8,000 10/04/03 – 24/04/01 – 10,000 10/04/00 09/09/09 9,966 10,000 09/09/02 25,334 09/09/99 8,000 – 30,000 12,000 8,350 A DPomfret 10,000 A DPomfret 10,000 5,000 P GPearson Lund 10,000 A TMorris 10,000 5,000 P DGChavasse 10,000 9,966 P DGChavasse 8,350 appointment Board Grant onorafter R PStockton R ISmeeton P GPearson Lund P GPearson Lund P GPearson Lund P GPearson Lund P GPearson Lund A TMorris appointment Board Grant priorto continued 6,1 8,0 ,5 71,966 8,350 187,501 267,817 1 Jan 2009* At At Exercised in 2009 ed bymarketpurchased sharesheldintrust. Lapsed in ts will be based on career average revalued earnings (CARE) with a ts willbebasedoncareeraveragerevaluedearnings(CARE) 2009 31 Dec 20 Date ofgrant 2009 At At ned contributionplan,establishedwithScottish exercise date ts only. IanBuckley andAndyPomfret have Earliest exercise date ts ceasedon31 October2007. Latest nal pensionablesalary. Exercise year was £6.68 to£9.60 yearwas£6.68 price ned contribution ned Exercise date value atdate of exercise l 2006 l 2006 Market te s

Rathbone Brothers Plc 41 Remuneration report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 42 Remuneration report employees, deathinservicecoverhasbeenextended toage65forthosethatstayinservicebeyond60. action, whererequired,toensurethatthepensionarrangementsforstaffconformnewregime.Where possible,forallUK Following theintroductionofGovernment’ssimplifi post-retirement discountratesandfuturemortality. promises orsimilararrangementsfordirectors.The increasesintransfer valuesaremainlyduetochanged assumptionsforinfl Table 7. There havebeennochanges inthetermsofdirectors’pensionentitlementsduringyear. There arenounfundedpens The changes inpensionentitlementsarisingthefi notice periodsofmorethan12months.Detailsthecontractsemploymentdirectorsservingduringyearareasfollo The Companyhasservicecontractswithitsexecutive directors.ItisCompanypolicythatsuch contractsshouldnotnormallyco Servicecontractsforexecutivedirectors any directorbytheCompany. RevenueandCustomslimits.There isnoundertakingorexpectationsubject toHM foranyotherpensionbenefi pension accruedundertheLaurenceKeen Scheme andbeinginexcess oftheGuaranteedMinimumPension) afterearlyretirement (or thelesserof5%perannumorriseinRetailPrice Index iflessforpensionentitlementaccruedafter1April2001 reduce by0.5%permonthofearlyretirementorotheractuariallybasedrates.Pensions willincreaseatarateof5% per an thatadirectorwouldtakewithhimaspartofthetotaltransfer valueifheweretoleavetheCompanyandmovehisbenefi The directorshavetheoptiontotakeearlyretirementonoraftertheir50thbirthday, inwhich casetheirpensionbenefi The increaseintransfer valuerepresentstheadditionalcapitalamountlessdirector’scontributionsnecessarytofund 4 infl The additionalpensionearnedintheyearincludingUK 3 infl The additionalpensionearnedintheyearexcluding UK (ornormalretirementdate,ifearlier) 31December2009 2 forthefi The pensionentitlementshownabove 1 Notes Table 7. Directors’accruedbenefi Pension arrangements at theAnnualGeneralMeeting. change ofcontrol.Executivedirectors’contracts of service,which includedetailsofremuneration,willbeavailableforinsp the directortomitigateloss incurred.There arenoclausesincontracts amendingemploymenttermsandconditionsona where appropriate.Intheevent ofenteringintoaterminationagreement,theBoardwilltakesteps toimposealegalobligatio light ofcurrentmarketpractice.Compensationwillincludeloss ofsalaryandothercontractualbenefi or anystatementsinrespectofthedutymitigation.Compensation paymentswillbedeterminedonacase-by-casebasisinthe notice wouldincludebasicsalary, pensioncontributions andbenefi by theCompanyandnopre-determinedcompensationpackage exists intheeventofterminationemployment.Payment inlieuof There arenoprovisionswithinthecontractstoprovideautomaticpaymentsinexcess ofpayment inlieuofnoticeuponterminat tctn1 uut20 6months 18August2008 6months 12months 6months 6months 5January2005 10October1997 27November2003 5December2002 R PStockton R ISmeeton A DPomfret P GPearson Lund A TMorris R PLanyon P DGChavasse I MBuckley Executive director 83,876 413,073 425,937 496,949 507,028 397,937 – 949,965 542,270 78,278 954,767 8,489 49,095 585,471 528 5,392 204,396 7,014 1,036,507 1,640,578 139,834 206,971 7,770 429,967 4,060 – 69,933 52,095 6,373 21 60,896 5,938 21 65,992 23,772 5,306 45 18 10 32,271 45 9 58 62 45 fi During 2009, R ISmeeton P GPearson Lund A TMorris R PLanyon P DGChavasse ve directors (2008: fi ve directors(2008: continued ve) accruedbenefi 31.12.09 Age at Years ts underdefi or65basedonserviceto ve participatingdirectorsisthatwhich wouldbepaidannuallyonretirementatage60 ts underdefi service at 31.12.09 Years of ation ListingAuthority,nancial year, requiredtobedisclosed bytheUK areshownin ation ned benefi cation of the pension taxation regime on 6 April 2006 theCompanyhastaken cation ofthepensiontaxationregimeon6April2006 ned benefi ned benefi 31.12.09 Accrued t at t t schemes t 1 t schemes (auditedinformation) ts. There arenoprovisionsforthepaymentofliquidateddamages in accrued excluding Increase benefi infl ation ts 2 in accrued including Increase benefi infl ation ts 3 Transfer value contributions directors’ of 2less coe 0412months 1 October2004 ac 956 months 9 March 1995 uy20 6months 1 July2003 aeo otatNoticeperiod Date ofcontract Transfer value ts butmitigationwillbeapplied ts to anotherscheme increase intheaccruedpension of accrued benefi 31.12.09 ts at ts Transfer value t tobearrangedfor of accrued benefi 31.12.08 ts at ts ts would ts ection contributions orfor n on in transfer value less Increase directors’ ation, num ws: ntain ion

ion

4 shown onpage34. remuneration isdiscussed.The Committeemetonfi The chairman andchief executive, attheinvitationofCommittee,attendmeetingsbutarenotpresentwhentheirown on theirappointmenttotheBoard6January2010). James Barclay, OliverCorbett,DavidHarrel,MarkRobertshaw, Kate Avery andKathryn joinedtheCommittee Matthews(whoboth The currentmembers oftheRemunerationCommitteeareindependentnon-executive directorsCarolineBurton(chairman), Remuneration Committee reduced accordingly. whilstheretainsthefee paidof£27,350 on14December2009, Friendly Society salaryhasbeen perannum,hisRathbones £25,000).Followingfees Plc(2008: of£41,250 from NXT hisappointmentasacommitteememberoftheFamily Assurance An exception isIanBuckley, IanBuckley receive In2009, PlcpriortojoiningRathbones. ofNXT whowasappointedtotheboard being payabletotheCompany. more thanonepositioninamajorcompany. Prior approvalofanynewappointmentisrequiredbytheBoardwithfees generally Executive directorsareencouragedtotakeonexternal appointmentsasnon-executive directors,butarediscouragedfromholdin External appointments salary withinfi New executive directorsareencouragedtobuild up andmaintainashareholdingatleastequivalenttothevalueofoneyear’sb Shareholdings Chairman oftheRemuneration Committee Caroline Burton Approved bytheBoardon23February 2010andsignedonitsbehalf by isonpages114to120. NoticeoftheAGM ordinary resolutionseekingapprovalofthedirectors’Remuneration reportfor2009. andeffective The an in June2006 foraccountingperiodsbeginningonorafter1November2006. Boardwillmove attheAGM those ofshareholdersandconformtotheprincipleslaiddown in therevisedCombinedCodeonCorporateGovernancepublished The Committeeconsidersthat,takentogether, thesevariousremuneration componentshelptoaligntheinterestsofdirectorswi Annual GeneralMeeting(AGM) senior independentdirectorwhereheorsheisnotchairman oftheAuditorRemuneration Committees. to thechairmen oftheAuditandRemunerationCommitteesrespectively. Anadditionalfee of£5,000 perannumispayabletothe The basicnon-executive was£35,000perannumwithadditional paymentsof£7,500 directorfee in2009 and£5,000perannum than theSIP. directors, whodonotreceivepensionorotherbenefi directors issubjecttoanannualassessment.The executive directorsareresponsiblefordeterminingthefees ofthenon-execu the AnnualGeneralMeetingfollowingtheirappointmentandthereaftereverythreeyears.The effectiveness ofthe non-executive Non-executive directorsdonothavecontractsofemploymentbut,aswithallotherdirectors,arerequiredtostandforelectio Non-executive directors appointment isreviewedannually. The Committeeisalsoassistedbythepersonneldepartmentandcompanysecretary. Deloitte alsoprovidesoccasionalad-hocadvice,particularlyonsharescheme issues,andsuppliestaxcompliancesoftware.The Remuneration Committeemeetingperannumandadviseonbestpracticelatestdevelopmentsinseniorexecutive remuneration. The RemunerationCommitteehasappointedDeloitteLLP (Deloitte)asadviserstotheCommittee.Deloitteattendatleastone Advisers totheRemunerationCommittee ve yearsoftakinguptheirappointment. ve occasions in 2009 (2008: seven).Detailsofattendanceatmeetingsare (2008: ve occasionsin2009 ts fromtheGroupanddonotparticipateinany groupincentivescheme, other n at asic tive

th d

Rathbone Brothers Plc 43 Remuneration report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 44 Audit committee report resources andauthorityoftheGroupinternalauditdepartment. an internalrisk-basedauditprogrammewhich isapprovedbytheAuditCommittee.The AuditCommitteealsoregularlyreviewsthe The Groupinternalauditdepartmentreviewsoperationsonacontinuingbasis.The frequencyofreviewsisdeterminedby Internal audit A separateRiskManagementCommitteeconsidersriskmanagementissues(seepage35). economic conditions. also considerednewFinancialReportingCouncilGuidanceonchallenges forauditcommitteesarisingfromcurrent for acquisitions.Committeemembersvisitedoffi the riskgovernanceframework.ItreviewedGroupstructureandaprogrammeofrationalisation;accountingpolicy theCommitteeconsideredanindependentreviewbyGrantThorntonDuring 2009, ofriskgovernancearrangementsand the scopeandfi Group internalauditdepartment,reportsproducedbythecompliancefunctions,half-yearandannualfi The reviewoftheeffectiveness oftheGroup’sinternalfi Internal controlsandriskmanagementsystems narrativestatementsanddisclosures,toensurethattheyarereasonableconsistentwiththereportedresults. • theGroup’saccountingpoliciesandanyproposedchanges; • • the signifi The Committeeconsiders: Financial reporting These aresetout inthetermsofreference oftheCommittee,which arereviewedannually. RoleandresponsibilitiesoftheCommittee six).Detailsofattendancebymembersaresetoutonpage34. (2008: The Committeemet onsevenoccasionsin2009 a chartered accountantwhilst other membershaveconsiderableexperience offi The Boardissatisfi Committee ontheirappointmenttotheBoard6January2010. (chairman), James Barclay, CarolineBurton,DavidHarrel,andMarkRobertshaw. Kate Avery andKathryn Matthewsjoinedthe aretheindependentnon-executiveThe directorsOliverCorbett membersof the AuditCommitteewhoservedthroughout2009 Committee members Audit committeereport cant fi cant ndings oftheannualexternal auditandperiodicreviewswithsenior management. nancial reportingissuesandjudgementsmadeinconnectionwiththeCompany’sfi ed thatatleastonememberoftheCommitteehasrecentandrelevantfi ces inBristol,Edinburgh,LiverpoolandWinchester (aswellasLondon). It nancial controlsisachieved primarilybytheassessmentof work ofthe nancial matters. nancial nancial experience. The chairman is nancial reporting; nancial nancial statements, nancial

considers itnecessary. The CommitteeperformsanannualreviewofitsperformanceandthisisalsoreviewedbytheBoard. attend meetingstoassisttheCommitteefulfi unadjusted errors. audit,presentationswerereceivedfromtheauditorsonauditprogress,fi Regarding the2009 no managementpresent. page 75. The Committeealsoreviewstheauditengagementletterseach yearandhasdiscussionswiththeauditors independence oftheauditorshasnotbeenimpairedbyprovidingtheseservices.Detailsauditors’fees areshowninnote business, thereareoftenadvantagesinusingtheauditorstoprovidecertainnon-auditservices.The Committeeissatisfi in anyyearwithoutthepriorwrittenapprovalofAuditCommittee.The Committeerecognisesthat,giventheirknowledgeof expected toexceed £25,000.Fees fornon-auditservicespaidtotheauditorsshouldnot,inaggregate,exceed 50%oftheaudit levels relativetotheauditfee. Prior approvalbytheAuditCommitteeisrequiredwherefee foranindividualnon-audits The AuditCommittee reviewstheindependenceandnatureofnon-auditservicessuppliedbyauditorsfee experience needed toauditaGroupwithbankingsubsidiary. Thefull reviewhadbeenundertakenin2006. Committee’sviewwasthattherewerealimitednumberoffi PricewaterhouseCoopers LLP ontherecommendation oftheAuditCommittee.Afulltenderprocesswasnotundertakenasa auditwiththeCompany.fees forthe2009 The Boardappointed PricewaterhouseCoopers LLP astheywereunabletoagreemutuallyacceptableaudit resignedasauditors on 3June2009 quality andcost-effectiveness oftheirwork. change ofauditfi The AuditCommittee isresponsibleforreviewingexternal auditarrangementsandforanyrecommendationtotheBoardregarding External audit On invitation,thefi (or whistleblowing)policy. The AuditCommitteealsoapprovessignifi Whistleblowing Other rm. This reviewincludesconsiderationoftheexternal auditor’speriodinoffi nance director, otherexecutive directors,complianceoffi cant changes totheGroup’sPublic InterestDisclosureActconfi l itsduties.The Committeecanaccessindependentprofessional adviceifit KPMG Audit Plctofi cers, seniorinternalauditstaffandtheexternal auditors ll thevacancyarisingonresignationof ce, theircompensationandthescope, ndings andrecommendations rms withtheskilland dential reporting dential ed thatthe ervice is 7on the fee

Rathbone Brothers Plc 45 Audit committee report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 46 Nomination committee report Nomination committeereport offi management belowBoardlevel.This hasbeendone byvisitstoGroupoffi Boardevaluationprocesshighlighted adesiretoincreasenon-executiveThe committeemembersexposure 2008 tosenior by theCommitteewhoserecommendationtoBoardwasthatKate Avery andKathryn Matthewsbeappointed. directors. From alonglist,shortlistofcandidateswasthenproducedandinterviewed.Three candidatesweretheninterviewe Board. Towards afi theendof2009, should besubjecttoparticularlyvigorousreviewandtakeintoaccounttheneedforprogressiverefreshingof The Committeeare mindfuloftheCombinedCoderequirementthatanytermbeyondsixyearsforanon-executive director nine years. years. Anon-executive directorisnotappointedforafi followingtheirappointment,andre-electioneverythree All directorsarerequiredtoseekelectionbythemembersatAGM candidates and,inthecaseofnon-executive appointments,theirothercommitments. directors. When consideringpossiblecandidates,theCommitteeevaluatesskills,knowledgeandexperience ofthe decides uponanysuch appointment.Anexternal search consultancyand/oropenadvertisingareusedwhenrecruitingnew The Committeeconsiders andmakesrecommendationstotheBoardforappointmentofdirectors;asawhole RoleoftheCommittee It alsohadinformaldiscussionsonanumberofotheroccasionsduringtheyear. two).Detailsofattendancebymembersaresetoutonpage34. (2008: The Committeemet formallyontwooccasionsin2009 Committee ontheirappointmenttotheBoard6January2010. Caroline Burton,OliverCorbett,DavidHarrel,AndyPomfret andMarkRobertshaw. Kate Avery andKathryn Matthewsjoinedthe areMarkPowellThe membersof the NominationCommitteewhoservedthroughout2009 (chairman), JamesBarclay, Committee members ce forthefi rst timeandtheintroductionofaprogramme Boardpresentationsonimportantbusinessareasorissues. rm ofheadhunterswasapproached regardingtherecruitmentof newnon-executive xed termbutwouldnotnormallyserveasadirectorformorethan ces, theholdingofaBoardmeetinginourEdinburgh d sustainability trendsinthemediumandlongterm. In future,wehopetobeableconsiderhowsustainabilityissuescanfurtherintegratedintoourbusinessmodeland intensity Estimatedourcarbon • Followed reportingstandards toenablecomparability internationalcarbon • emissionsthroughoursupplychain fortravelandpaperconsumption Reportedourindirectcarbon • objectivesandoutlinedourfor2010 Reportedagainstour2008 • Discussedoursustainabilitytrendsintheshortterm • ReportedonsustainabilityissuesthatarematerialtoRathbones • In linewiththeprinciplesoutlinedinFramework, wehave: sustainability issuestobemainly: sustainability issuesisrelativelysmallcomparedtootherhighimpactsectorsorlargerfi As aproviderofinvestmentandwealthmanagementserviceswithoffi Oursustainabilityissues by thePrince ofWales’s AccountingforSustainabilityProject This yearwehave decidedtoreportinaccordancewiththecriteriasetConnectedReportingFramework, aninitiativelau Introduction Corporate responsibilityreport For moreinformation goto:www.accountingforsustainability.org 1 portfolio management. opportunity forprivateinvestors toinvestincompaniesattheforefrontofclimatechange mitigationthroughbespoke unitorinvestmenttrusts,ethicalbanking,mortgages,lessspaceisgiven tends tobeonproductsandservicessuch asSRI undoubtedly ledtogreaterawarenessoftheconcept‘ethical’ or‘sociallyresponsible’investment.Whilst agreatdealoff Increasing mediacoverageandgeneralconsumerawarenessof socialandenvironmentalissues(especiallyclimatechange) have GreenbankInvestments. ethical investmentservice,Rathbone and ethicalconsiderationsaretakenintoaccountforspecifi policy,Although generalinvestmentactivitiesarenotcoveredbyaformal sociallyresponsibleinvestment(SRI) social,enviro Socially responsibleinvestment &EnvironmentalCommitteehasidentifi Social With mattersastheyaffect ourbusiness,theBoardbelievesthatGrou regardtoenvironmental,socialandgovernance(ESG) to theGroupExecutiveCommittee. IT andinvestmentmanagement.The Committee ischaired byourchief executive, meetsonaquarterlybasisandreportsdirectly issues. The Committeeisformedbymembersofstafffromkeyfunctionssuch asfacilitiesmanagement,personnel,marketing, effectively managesitssustainability isresponsibleforensuringthatRathbones &EnvironmentalCommittee(SEC) The Social employees involved. Positive thelocalcommunitiesand engagementwiththecommunitiesaroundusisconsideredimportantforboth Community –Involvementandengagement fi As afi Employees –Access toskills travel costsandwastewillreduceprofi ReductionCommitmentlegislation,werecognisethatincreasingenergybills,paperusa Although wedonotfallundertheCarbon Environment –Carbonrelatedcosts impact thelong-termvalueofcompanies. Whilst theprimaryconsiderationistomaximiserisk-adjustedreturnsclients,werecognisethatnon-fi Socially responsibleinvestment nancial performance. nancial nancial companyouremployeesaremost valued asset.We believethatamotivatedandsatisfi ts as well as increasing our carbon footprintandshouldbeminimised. ts aswellincreasingourcarbon ed andassessedthesignifi c mandatesthroughouttheGroup,butparticularlybyourspecialist 1 . ces in the UK andJersey, ces intheUK weconsiderthatourexposure to cant riskstotheCompany’sshort-andlong-termvalue. nancial servicesproviders.We considerour nancial considerationscan ed workforceleadstobetter ocus nmental to the nched p ge,

Rathbone Brothers Plc 47 Corporate responsibility report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 48 Corporate responsibility report larger offi of unreportedconsumptionfortheLondon offi Our baseyearis1October2007 Baseyearfi September2008. to30 -part1. 14064 andISO (September 2009) Scope andboundaries Ourenvironmentalperformance emissions. In addition,wearecurrentlyevaluatingthebusinesscaseforoffsettingsomeofourcarbon Further reducetheneedfortravelthroughuseofvideoconferencing systems • staff Monitorandreducetheenergyconsumptionofouroffi engagement • order toachieve intensiveactivities.These thisgoal,wehaveagreedaseriesofactionsfocusedonaddressingcarbon include emissionsduringbaselineyear2007/08,Based onourcarbon footprintwherepossible. ouroverallgoalistoreducecarbon Howwemanageourenvironmentalimpacts related emissions,resourceconsumptionandwastegeneration. Our directenvironmentalimpactsarethosetypicalofanoffi Ourdirectenvironmentalimpacts addressed anyreasonablemeasuresitcouldbeexpected totake. considers thatthestepsithasalreadytakenincourseofrefurbishmentitsLiverpoolandLondon offi The needtocomply withanyfuturetighteningofenergyeffi not considerthattherewouldbeanysignifi restrictions onuniversalbusinessenvironmentalissuessuch asresourceuse,buildingprocurementandbusinesstravel,thenwe The Companyisnot alargeemitterofsuch gases,norisitanexcessive consumerofresources.Unlessfutureregulationsimpos government policyonissuessuch asclimatechange astheymightrelatetorestrictionsonemissionsofmajorgreenhousegases. considersitselftobeatlimitedriskfromanychangeFrom inregulationor thepointof viewofcommercialrisk,Rathbones Environment 2 Offi Institute (WRI) Data hasbeencollectedandcalculatedinaccordancewiththe requirementssetinthefollowingstandards:World Resources Data collectionandcalculation Birmingham andKendal To enablecomparability, operationsexcluding ofthedatacollectedareunchanged, coveringtheUK thescopeandboundaries 23 February September2009. to30 2010.Itrelatestotheperiodfrom1October2008 &EnvironmentalCommitteeandtheBoardon The informationprovidedinthisreportwasapprovedbytheSocial wasbasedonpaperpurchased andprintingrecords oftrainjourneyswereestimatedbasedoncost.Waste data:The majorityofwastedatawasestimated basedonoffi availableforthewholebuildingandhadtobeadjustedpro-ratagiveestimated fi benchmark wasused.Inmostcasesdatadidnotaccount forthefullreportingyearandhadtobeextrapolated. Inthecaseof Datasources: mostofourelectricityandgasusedatacomesfrommeterreadingsor invoices. DataforExeterwasnotavailab 3 since 2006 and became a signatory to the UN Principles forResponsibleInvestmentinSeptember2009. andbecameasignatorytotheUN since 2006 with specifi in newshareissuesoffered bycompaniesoffering environmentallyandsociallybenefi provide investmentservicesappropriatetoclients’interestintheseareas.Where appropriate,theCompanyisalsoabletopar UnitTrust GreenbankInvestmentsandRathbone Through Rathbone Management’sEthicalBondFund, theCompanyisableto Socially responsibleinvestment ces underscopeareinBristol,Cambridge,Chichester, Edinburgh,Exeter, London, Liverpool,andWinchester ces throughtheintroductionofanenergytracking tool. c interests in these areas. As a group, Rathbone Brothers Plc has been a signatory to the Carbon DisclosureProject BrothersPlchasbeenasignatory totheCarbon c interestsintheseareas.Asagroup,Rathbone

Greenhouse Gas (GHG) Protocol (revised version), DEFRA Guidance on How to Report GHG Emissions GuidanceonHowtoReportGHG Protocol (revisedversion),DEFRA Greenhouse Gas(GHG) 2 . This representsapproximately 92%ofGroupemployeesasat31December 2009. 3

continued cant impactonourbusiness. ce. We haveimprovedthequalityofenergyconsumptiondata reportedforour ces throughimprovedenergyefﬁ ce basedbusiness,forexample, energyconsumptionofbuildings, travel ciency standardswouldbeofgreaterimpact.However, Rathbones gures for the space occupied by Rathbones. Travel gures forthespace occupiedbyRathbones. data:approximately 40% gures havebeenrecalculatedfollowingtheidentiﬁ cial productsorservicesonbehalfofclients ciency, managementand ce samples.Paper data:Paper consumption Liverpool, gasdatawasonly le; thereforeaGovernment ces havelargely cation ticipate : do e In

0 Datare-baselined toincludepreviouslyexcluded envelopes 10 Asmallchange intheestimatedwastevolumerefl 9 Dataextrapolated toallowcomparisonwiththecompletedata coverage offl 8 Table 1.Absolute andrelativeCO Chart1–Tonnes ofCO tonnesofCO footprintforthisyearis2,390 Our totalcarbon Chart 1andinTable 1. We footprintinscopes1–3defi havereportedourcarbon Our carbonfootprint 7 Data re-baselined (see above). 1,074 Datare-baselined(seeabove). tonnesCO 7 Electricityconsumptionhasbeenre-baselinedfor2007/08. We previouslyreported1,999,470 kWh butwehaveaddedan additio 6 identifi

Company cars(CO Company cars(km) CO Waste (tonnes) uiestae k)295542,701,346 2,905,584 Bristolhasmovedoffi 5 We footprintintermsofCO haveexpressed ourcarbon 4 Paper (tonnes) Total CO Total CO Business travel(km) Scope 3 Total CO Offi Our environmentalperformance ubro mlye sa 1Dcme 9 704 699 Electricity andgasCO Gas (CO Gas use(kWh) Scope 1 Number ofemployeesasat31December Total CO Electricity (kWh) Scope 2 ce squaremetres(m 2 tne)prepoe . 3.4 3.4 e (tonnes)peremployee cation ofunreportedconsumptioninLondon 2 2 2 2 2 e (tonnes) e (tonnes) e (tonnes) e (tonnes) e tonnes) 2 ces which hasresultedinasmallchange inthetotalfl ons 319 13 e tonnes) 2 e tonnes/m 2 10,695 ) 2 e byemissionssource 2 continued 2 e fromRathbones’offi 2 e waspreviouslyreported ecting betterdataquality 2 equivalent(CO ned by the World Resources Institute (WRI) GHG Protocol in GHG ned bytheWorld ResourcesInstitute (WRI) 2 e 2 e) toaccommodatenon-CO 4 . (2007/08: tonnes). 2,392 oor areaforthegroup ight dataforthisyearandtomaintainconsistencyofapproach ces underscope 2 greenhousegasemissions Total 2,390 Air 273 opn as 13 77 Gas 254 Company cars Electricity 1,665 Non-company cars Taxis 6 Rail 102 ,6,1 2,984,736 3,060,113 ,4,3 1,455,655 1,243,539 48983,416 64,889 2008/09 2008/09 ,9 2,392 2,390 1,665 1,603 1,603 1,665 .80.18 0.18 5 300 254 1 226 470 213 458 6 319 267 898 98 nal 985,266 kWh followingthe nal 985,266 5 Tonnes CO (Base year) 10,727 2007/08 2 e 10 9 8 7 6

Rathbone Brothers Plc 49 Corporate responsibility report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 50 Corporate responsibility report both kilometrestravelledandCO both energy production.Asaresult,in London wehaveachieved ourobjectiveofsendingnowastetolandfi In London andLiverpoolwehavealsoseenwastetoenergyinitiatives implementedandnowsendhalfofournon-recycledwaste t suppliers. We continuetoimproveourrecyclinglevel,achieving anestimatedaverage83%recyclinglevelacrossthebusiness. We havecarriedout widesamplingofourwastestreamsinmainoffi recycling. Wherever possiblewecontinuetorecyclefl disposalagentwithazerotolandfi ITServices(anapprovedWEEE Redundant ITequipmentispassedtoEOL it isestimatedthat254kgrecycled. offi All offi Landfi We willcontinueto encouragetheuseofpublictransportwherepractical. Objectives for2010 emissionfactors.Non-companycarusehasdecreasedsignifi due tochanges inDEFRA against ouroperatingincomeandfundsundermanagement. For thefi Overall, wehavereportedadecreaseof2%inCO Business travel(excludingcompanycars) Scope 3 with electricity. Liverpool andBristolreportedadropinconsumption.Bristol’sincreaseisduetoanoffi Our totalelectricityconsumptionhasincreasedby3%comparedtothepreviousyear. Allofouroffi Electricity Scope 2 The phasingoutof companycarshascontinuedasleasesend. Company cars than originallyestimated. Government benchmark. Upontheintroductionofenergytracking wefound outthatinfactenergyconsumptionwas24%lower Natural gasconsumptionhasdecreasedby15%overthepastyear. Lastyear, Liverpoolgasconsumptionwascalculatedusinga Natural gas Scope 1 Performance analysis 1 Tonnes CO Table 2.Carbonintensity Ourenvironmentalperformance Our travelCO Flights although thefullbenefi whichcompleted ourconsolidationofbusinesstravelbookings hasresultedinincreased confi Our use of taxis has decreased by 11% to 25,391 km.However,Our useoftaxishasdecreasedby11%to25,391 relativeCO Taxis andnon-companycars network inExeter, BirminghamandEdinburgh. kmto1.67m from1.36m kmdueinparttotheexpansion oftheregionaloffi National railtravelincreasedby23%in2008/09 Rail ofwasteproducedperemployeeannum, ces shreddedpaper, andcansarealsorecycled.Ofthe305kg glass,plasticbottles prtn noe1681122. 18.2 0.23 20.5 0.18 131.2 10,460 116.8 13,100 Funds undermanagement (FUM) Operating income ces have an active recycling programme with high levels of participation that cover at a minimum paper and cardboard. Inmost ces haveanactiverecyclingprogrammewithhighlevelsofparticipationthatcoverataminimumpaperandcardboard. ll wasteandrecycling rst timethisyear, intensity andinlinewith theAccountingforSustainabilitymodel,wehavedecidedtoreportourcarbon 2 e emissionsaredominatedbyfl 2 e per £m of operating income or FUM e per£mofoperatingincomeorFUM ts willberecognisedin2009/10. 2 e emissionsin2008/09. continued ofemissions.Weights which generate60% arepleasedtoreportareductionof4%in 2 e emissionsfromthebaselineyear. We arepleasedtoreportthatwehave uorescent tubes,batteries,tonercartridgesandmobiletelephones. 2009 (£m) ces andhaveimprovedthequalityofdatareceivedfromour 2 e emissionshaveincreasedby1tonneCO 2008 (£m) ce movetonewpremisesthatonlyoperates cantly. dence inthequalityofdatawereport, ces withtheexception of ll. Carbon intensity Carbon 092008 2009 ll policy)forre-useor 1 2 e ce o each deal.We willalsocontinuetoseekcosteffective waystoreduceuseofvirginstock wherepossible. possible, asummaryofdealsisnowsenttoclientswiththeirperiodicvaluationsratherthanpostingcontractnoteatthet We remainfocusedonimprovedpapermanagementinouroffi Objectives for2010 emissionsforpaper, footprint. wehaveexcludedstandard currentlyexists thisfromtheoverallcarbon forGHG Table 3.Waste andrecyclingdata Ourenvironmentalperformance Table 4.Paper usage We tonnesCO haveestimatedthatourpaperconsumptionthisyearhascausedemissionsof 208 from yeartodueinpartprintinglayoutchanges forclientvaluationpacks andincreaseddemandforotherprintedstat We havemanagedtoreduceourstationerypaperusebyapproximately 3millionsheets.Paper useforprintinghas increased postconsumerwaste. 100% recycledproductmadeexclusively fromUK 65% ofourpaperconsumptionbyweightisrecycledstock. The majorityofthestationerypaperpurchased isEvolvebrand,a print supplierstoreducewasteintheprintingofourreportsandbrochures. intensiveproducttoproduce.Wecarbon aim,wherepossible,toreduceusage,purchase recycledpaperandtoworkwithour Total tonnes,which isapproximately paperconsumptionamountsto98 equivalentto14.1millionA4sheets.Paper isanenergya Paper usage ignppr51 161 21 15 77 6 40 37 21 77 16 50 5 100% 0% 0.3 27 6% 71% 226 30% – 35% 161 14 100% 68 9% 79 82% 0.3 4% 213 Virgin paper 48% Recycled paper 18 30% Paper weight(tonnes) 177 9 104 64 Per employee Total waste Residual landfi Waste toenergy Total recycling Other materials Secure shredding Paper andcardboard l at 89 529% 65 9% 18 waste ll

continued Mass collected (2008–09 (tonnes ces andwillincreaseeffortstoreduceourprinted paperuse.Where )% ) Stationery 2008–09 26 84 598 55 43 98 66 32 2008–09 Print 2008-09 Total 2 Mass collected e. However, asnoagreed (2007–08 Stationery 2007–08 (tonnes )% ) 2007–08 Print ime of ionery. 2007–08 Total nd

Rathbone Brothers Plc 51 Corporate responsibility report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 52 Corporate responsibility report goal istoincreasethisrating 4by2010strengtheningitsdatagatheringsystems. 1 (poorest)to5(best).For thisyear, overalldata qualityhasbeenrated3.2,animprovementcomparedtolast year(2.6).Ra Protocol principles.Datafromeach emissionsourcehasbeenrated Smarthas assessed thedataqualityagainstGHG Carbon To ourknowledge, dataisconsideredaccuratewithinthelimitsofqualityand completenessofthedataprovided. Accuracy estimations andre-baseliningperformed. Where relevant,wehaveincludedappropriatereferences totheaccounting andcalculationmethodologies,assumptions, Transparency re-baselined datatoaccountforchanges intheemissionsunderscope. In ordertoensurecomparability, wehave usedthesamecalculationmethodologiesandassumptionsaslastyear. We have Consistency efforts foritsmostmaterialemissions. control orsignifi oftotalemployeesincludingallentitiesthatmeetthecriteriabeingsubjectt Reported environmentaldatacoversover90% Completeness internalandexternalneeds ofusers,both totheCompany. inventoryappropriately refl We haveensuredtheGHG Relevance We haveconcludedthefollowing: of sourcedataandcollectionsystemsincludingcomparisonswiththepreviousyearasitevisittoLiverpool. personnel,areviewofinternalandexternalOur workhasincludedinterviewswithkeyRathbones’ documentation,interrogation and verifi –part1standard 14064 appropriate standardsandindustrypractices.DatahasbeencollectedcalculatedfollowingtheISO businessandthatthedatapresentediscredible,coherentcompliantwith footprintisrepresentativeoftheUK carbon thatthereported Corporateresponsibilityreport.Through SmarthasassuredRathbones for its2009 thisengagementCarbon offi footprintforselectedUK carbon BrothersPlctomeasureRathbones’ SmarthasbeencommissionedbyRathbone Carbon sustainability. managementapproachIt doesnotrepresentanindependentthirdpartyassuranceofRathbones’ to reliability ofRathbones’ footprintdataforthereportingperiodcarbon 1 October 2008 to 30 September 2009. anditsstakeholders withathirdpartyassessmentofthequalityand This statementprovidesRathbones Carbon SmartOpinionStatement Table 5.Performance versusourobjectives Ourenvironmentalperformance fl systems forenergy, Improve datacollection client communication use inouroffi Paper use:Reduce paper u betv o 09PromneCmetOurobjectivefor2010 Comment than fl the useofrailrather footprint byencouraging Performance Reduce ourtravelcarbon intensive offi Review energy Our objectivefor2009 Liverpool offi policy inourLondon and Implement azero-to-landfi ights andrail ed against the WRI GHG Protocol principlesofcompleteness,consistencyandaccuracy. GHG ed againsttheWRI ights ces ces cant infl cant ces andfor uence ofthereportingorganisation.We continuestoimprovedata collection recommendthatRathbones ll o civdWe haveseenasignifi Not achieved ntakOurdataqualityhasimproved.However On track EnergyauditforLiverpooloffi On track civdWe havereportedanincreaseinthe Achieved civdOurzero-to-landfi Achieved

continued ects the GHG emissions oftheCompanyandservesdecisionmaking ects theGHG increase inprintedpaper use. Howeverwehaveseenalarge (2 millionA4sheets)inouroffi cost data ofraildataisestimatedbased on 40% in November2009 Liverpool offi successfully initiatedinourLondon and emissions havedecreasedby2.6% the numberoffl number ofrailjourneysandareductionin ces ights. Ourscope3 ll programmehasbeen cant decrease cant ce ce paper ce client communication stationery use,particularlyfor Seek waystoreduceprinted in otheroffi Seek waysofreducingwaste access systemwithon-line booking Enhance thecentraltravel Energy auditinBristol the useofvideoconferencing and seekwaysofincreasing We willreviewourtravelpolicy ces thbones’ thbones’ ces o an independentandconfi paid forbytheCompany. staffhavetheopportunitytoattendanannualmedicalexamination alsoprovides andRathbones AllUK employees(andtheirdirectfamily members)areeligibleforprivatemedicalcov Upon completionofaqualifyingperiod,allUK are maintained. representatives fromallouroffi We providearangeoftrainingcoursesforthosestaffwithhealthandsafety responsibilitiesanda steeringgroupcomprising Ourenvironmentalperformance which paysamonthlyincomeinlieuofsalaryandpensioncontributions onbehalfoftheemployerandemployee. their employmentandtraining.Should thisnotbepossibleweprovidesupportintheformofa permanenthealthinsuranceschem whereverpracticable,arrangementsandadjustments aremadetocontinue become disabledduringtheirservice withRathbones, It isourpolicyandpracticetogivefullfairconsideration applicationsforemploymentbydisabledpeople.Ifemploye and onmeritregardlessoftheirrace,gender, maritalstatus,age,disability, religiousbelieforsexual orientation. isanequalopportunitiesemployeranditourpolicytoensurethatalljobapplicantsemployees aretreatedf Rathbones Equality anddiversity offi consultants ourhealthandsafety policyfortheUK iscommittedtoprovidingasafeRathbones andhealthyenvironmentinwhich itsemployeescanwork.With thehelpofexternal Health andwelfare AssociateDirector and involvementareallvitaltothecontinuingsuccessofbusiness. As withallprofessional servicesfi EstherRodriguez SmartLimited Carbon Employees SmartLimited Carbon Director Murray Ben Signed London, 23February 2010. criteriaforLead SustainabilityAssurance Practitioner.business andacademicexperts meettheIRCA andsustainabilityconsultancy headquarteredinLondon. Smartisacarbon Ourteamofsustainability,Carbon environmental, About CarbonSmart cp121%2Asignifi 2 2.6 11% 2 3.2 Scope1 Overall Scope ae / Highlevelofgoodqualitydatacoverage 4 Waste datahasimprovedsignifi 2 Flightdataqualitywasgoodwithminor n/a 2 n/a Majorityofelectricityrelateddataisfreefrom 4 3 19% 3 70% 3 Waste andrecycling 4 Paper Scope 3 Scope 2 dential employeeassistanceprogrammeoffering adviceonemployment,personalandlegalconcerns. Data qualityrating ces meetsquarterlytoshareknowledgeandensurethathealthsafety standards rms, Rathbones’ greatestassetisitspeople.Their health,well-being,development,remuneration rms, Rathbones’ 2008-09

continued % Carbon footprint % Carbon 2008-09 ces isregularlyupdatedtoreﬂ Data qualityrating 070 Comments 2007-08 based oncostbenchmarks required moderateextrapolation. Taxi data was assumptions andestimates.Railcardata extrapolations and proratacalculations assumptions andestimations.There aresomeminor London andLiverpool ofﬁ required minorassumptionsandestimates and benchmarks hadtobeused.Companycardata ect currentlegislationandbestpractice. cant portionofgasdatawasnotavailable ces cantly inkey es airly er e

Rathbone Brothers Plc 53 Corporate responsibility report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 54 Corporate responsibility report giving fi The professional standardselementoftheFSA’s aimstoraisetheprofessional standardsofth RetailDistributionReview(RDR) DistributionReview–professionalRetail standards client meetings.The proposition isfullyandpersuasivelyexplained. aimofthisistoensurethattheRathbone A newlongtermprogrammewaslaunched tohelpfurtherimprovebusiness developmentskillswithaninitialfocusonhandling more ofthistypetrainingduring2010. managers. This coursewastailoredforourbusinessanddesignedtobeimmediatelyrelevantback atthedesk.We aimtodelive A twodayrefreshercourse,‘The Application ofFinancialRatiostoStock Selection’wasattendedbythemajorityofourfund New initiatives wehavecontinuedtodevelopsomelongtermdevelopmentprogrammesaswelllaunchingDuring 2009 somenewinitiatives. the jobtrainingandcoaching. a numberofoptionsprovidedincludingattendingexternal coursesorconferences, internalseminars,developmentprogrammes,on regulatory requirements.We supportthisbyhelpingindividualstofi It isvitalthatallstaffcontinuouslyimprovetheirskills,keepuptodatewithdevelopmentsinareaofexpertise and Training anddevelopment annual sickness ratesandstaffturnover. The uptakeandeffectiveness ofthesepoliciesismonitoredtogetherwithotherindicatorsstaffsatisfactionlevelssuch as months’ unpaidleaveonceineverytenyearswithoutanylossofservice-relatedbenefi particularly fromparentswithyoungchildren. Oncompletionoffi for thosewithchildcare responsibilities.Flexible workingpoliciesareoffered withahighnumberofsuccessfulapplications, Maternity benefi additional daysofleavewiththeagreementtheirmanager. daysafterfi business. Holidayentitlementsare25daysincreasingto30 recognisestheimportanceofanappropriatework-life tothehealthandwelfareofemployees Rathbones balanceboth Work-life balance Employees An averageof2.3 daysperpersonwasspentattending trainingcourses. wespent £326,790 continuestoinvestinstaff training.In2009 Rathbones ondevelopment, anaverageof£476 perperson. Investment Offi A verycomprehensivetrainingprogramme involvingallstaffwasimplementedtosupportthe upgrade toanewversionofMicrosof IT Skills increased theengagementofthisgroupstaff. skills, networkingandinputfromarangeofstafftoenablegreater understandingofrolesacrossthebusiness.This initiati Now initssecondyear, the programmeofquarterlymeetingscomprisecommunicationkeybusinessinitiatives,traininginnew TrainingSecretarial Programme techniques ofmanagement.Eightdelegateshavechosen totakehigherlevelqualifi awarded bytheCharteredManagementInstitute.This wastheculmination ofaninemonthtrainingprogrammefocusingonthe At thebeginningofyear15ourmanagersandteamleaderssuccessfully completedanintroductorylevelqualifi Management Skills managers andfellow participants. At theconclusionofthisprogrammedelegatescreateindividualdevelopment planswiththehelpoffeedback fromsenior responsibility andtodevelopprojectmanagementskills. thebusinessoutsideoftheirarea This hasprovedtobeagoodopportunityfordelegatesgetknowmoreabout Implementationofasingleproviderforbusinesstravel • Standardisingdocumentationacrossthebusinesstoensureaconsistentimage • Aclientsurveytoensurethatwearetreatingclientsfairly • increasing involvementinthebusiness.Asignifi DevelopmentProgrammeThe hascontinuedthisyear with theaimofimprovingnetworking,professional Rathbone skillsand DevelopmentProgrammeRathbone processwewilllooktoenhancethisandensurethattargeteddevelopmentopportunitiescontinuebeavailable. CPD hasalongstanding andwhilstRathbones alsoplacesagreateremphasisoncontinuousprofessional development(CPD) The RDR ce. This enabledasmoothtransition andprovidedanopportunityformanytoupgradetheirskills. nancial adviceacrossthesector. Asaresultsmallnumberofourstaffwillhavetocompleteanadditionalqualifi

ts remaininexcess ofthoserequiredunderstatutoryprovisions.Careerbreaksuptotwoyearsarealsoavailable continued cant partofthishasinvolvedworkingonlivebusiness issuesincluding: ve years’service,employeeshavetheopportunitytotakeupthree nd themostappropriatedevelopmentopportunities.There are ve years’service.Employeesareabletobuyupﬁ cations andwillcompletetheseduring2010. ts such aspensionordeathinservicecover. cation meet cation. cation. ve has

ve average ose

benefi contributions toprovidedeathinservicecoverandbenefi recognisesitsresponsibilitytoassistinthefi Rathbones probationary periodandoffer acycletoworkscheme. To encouragetheuseofpublictransport,weoffer interest-freeloansforseasontickets toallstaffonsatisfactorycompleti of £156permonth. withanoptionexercise Take-up26 November2009 priceof£6.96. employeesparticipatingsavinganaverage wasstrongwith238 shareholdersapprovedthelaunchOn 19November2009, ofanapprovedSavingsRelatedShareOptionPlan.This waslaunched on monthly contributionsnowowns4,975 asat31December2009. shares,which werevaluedat£39,800 sinceitslaunch andwhohas madethemaximum growth conditionsareachieved. AmemberofstaffwhohasbeenintheSIP matches everysharepurchased byindividualemployeeswithanotherfreeofcharge. Sharesarealsogivenfreeofcharge ifearn remainspopularwith670 holdinganaverage of2,010shares.The(SIP) Company employeesparticipatingat31December2009 Employees areencouragedtoidentifyandbecomeinvolvedwiththefi Rewards andbenefi Employees support for 2008 and 2009. During 2009, £9,497 During 2009, hasbeenraisedbystaffforthese twocharities. and2009. support for2008 HelpforHeroesandthe RoyCastleLungIn 2008, CancerFoundation wereselectedbyemployee ballotasthecharities wewould experience placesforeach school each yearandoffer asmallnumberofsixthformpupilspaidsummerwork. Enterprise daysandpupilmentoring, alldesignedtoenhancecapabilityandfutureemployability. We alsoprovidetwowork management skills.Anumberof initiativeshavebeenimplementedwiththeindividualschools includingCV workshops, Business the variouscommittees.The membersofstaff involvedare,asaresult,givenopportunitiestodeveloptheir wider professional helpingtomaintainworkingrelationshipswitheach schoolbodies, whilstbringingawiderangeofskillsandbusinessexperien Specialist Schools and AcademiesTrust status.AnumberofemployeesfromourLiverpool offi wasdonatedaspartofafouryearcommitmentmadetosupportLiverpoolsecondary schools in theirbidsfor £30,000 £77,843) (2008: donated £81,109 tocauseschosen byemployeesthroughthismethod. by theCharitiesAidFoundation. The Companymatched staffdonations ofupto£200permonthmadethroughGAYE andin2009 employeesmadepaymentstotalling£384,273 Rathbone £107,783)In 2009, (2008: throughthisscheme, which isadministered Staff areencouragedtodonatecharity inataxeffi £165,478,(2008: ofcontinuingGrouppre-taxprofi representing0.39% During theyear, theGroupmadetotalcharitable donationsof£174,098, representing0.59%of continuingGrouppre-taxprofi Donations andfundraising in Liverpool. Liverpool whilst16employeesinworkedon-siteforadayhelpingbuild32awardwinningHabitatHumanityhomes During theyear, 20employeesassistedatPersonal eventsforschool children Finance EducationGroup(PFEG) inLondon and localandinternationalcharities.a widerangeofactivitiesinvolvingboth onagroupandlocalscale,supportsemployees’participationin continuestoreviewcommunityactivities,both Rathbones Community and marketing. committees andworkingpartiesdrawinparticipationfromacrossthefi Consultation withstafftakesplacewhenmajorchanges tobenefi these meetings. market trends,assetallocationandindividualinvestmentmatters.Non-investmentmanagementstaffarealsowelcometoattend daily morningmeetingtohearkeymarketnewsandbytelephonevideoconference weeklyforamorein-depthdiscussionof InvestmentManagement’soffi All investmentmanagersacrossRathbone workspace. Presentations tostaffonfullandhalfyearresultsaregivenbyBoardmembers. have easyaccesstopolicies,procedures,organisationcharts, announcementsandcompanynewsthroughaweb-basedshared Communication withstafftakesplacethroughavarietyofmeansincludinginternalemailandannewsletter. Employees Employee involvement scheme andtobring thecostmoreintolinewiththatofdefi The witheffect changesto careeraveragerevaluedearnings(CARE) from1July2009. weremadetoreducethecostof ts ofemployeesinthedefi continued ts ned benefi ned to65andamove t scheme werereducedbyanincreaseintheretirementagefrom60 cient mannerthroughtheGiveAsYou Earn(GAYE) payrollgivingscheme. nancial welfareofitsemployeeswhentheyreach retirementageandpays ts onretirement.Following aconsultation process,thefutureaccrued ned contributionscheme. ts such aspensionsarebeingconsideredandarangeofinternal rm onkeyissuessuch asIT, training,businesscontinuity ts). nancial performanceoftheGroup.The ShareIncentivePlan ces in the UK andinJerseyarelinkedbytelephonefora ces intheUK ce sitontherespectivegoverning on oftheir and ts ce to

ings

Rathbone Brothers Plc 55 Corporate responsibility report Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 56 Statement of directos’ responsibilities in respect of the report and accounts report andaccounts Statement ofdirectors’responsibilitiesinrespectthe Responsibility statement relevantauditinformation(asdefi each ofthedirectorshastakenall stepsthathe/sheoughttohavetakenasadirectormakehimself/herselfawareof • theCompany’sauditorsareunaware;and so far aseach ofthedirectorsisaware,therenorelevantauditinformation (asdefi • In thecaseofpersonswhoweredirectorsCompanyatdatewhenthisreportwasapproved: legislation inotherjurisdictions. governingthepreparationanddisseminationoffi Company’s website.Legislation intheUK The directorsareresponsibleforthemaintenanceandintegrityofcorporatefi Corporate governancestatementthatcomplywithlawandthoseregulations. Under applicablelawandregulations,thedirectorsarealsoresponsibleforpreparingaDirectors’report,Remunerationreport reasonably opentothemsafeguard the assetsoftheGroupandtopreventdetectfraudotherirregularities. that itsfi transactions anddisclosewithreasonableaccuracyatanytimethefi The directorsare responsibleforkeepingadequateaccountingrecordsthataresuffi Companywillcontinueinbusiness. preparethefi • subjecttoanymaterialdeparturesdisclosedandexplained intheCompanyaccounts;and • AccountingStandardshavebeenfollowed, fortheCompanyaccounts,statewhetherapplicableUK • asadoptedbytheEU; fortheGroupconsolidatedaccounts,statewhethertheyhavebeenpreparedinaccordancewithIFRS • makejudgementsandestimatesthatarereasonableprudent; • selectsuitableaccountingpoliciesandthenapplythemconsistently; • Company fi view ofthestateaffairsGroupandCompanytheirprofi Under companylawthedirectorsmustnotapprovefi GenerallyAcceptedAccountingPractice). (UK AccountingStandardsandapplicablelaw applicable lawandhaveelectedtopreparetheCompanyaccountsinaccordancewithUK an asadoptedbytheEU that lawthedirectorsarerequiredtoprepareGroupconsolidatedaccountsinaccordancewithIFRSs Company lawrequiresthedirectorstoprepareGroupconsolidatedaccountsandforeach fi accordance withapplicablelawandregulations. The directorsare responsibleforpreparingtheAnnualReportandGroupconsolidatedaccountsCompanyaccounts,in 23 February 2010 Chief executive A DPomfret We confi By OrderoftheBoard withthedescriptionof principal risksanduncertaintiestheyface. ofthebusinessandposition oftheCompanyandundertakingsincludedinconsolidationtakenasawhole,together glance,Strategyandbusiness performanceandthebusinessreviewincludesafairviewofdevelopment (2) the Directors’report,togetherwithinformation providedintheChairman’sandChiefexecutive’s at statements,Rathbones asawhole;and assets,liabilities,fi fi (1) the nancial statements,preparedinaccordancewiththerelevantfi nancial statements comply with the Companies Act 2006. They havegeneralresponsibilityfortakingsuchnancial statementscomplywiththeCompanies Act2006. stepsasare rm thattothebestofourknowledge: nancial statements,thedirectorsarerequiredto: nancial statementsonthegoingconcernbasisunlessitisinappropriatetopresumethatGroupand nancial positionandprofi ned) andtoestablishthattheCompany’sauditors areawareofthatinformation. t orlossoftheCompanyandundertakingsincludedinconsolidationtaken nancial statementsunlesstheyaresatisfi nancial positionoftheCompanyandenablethem toensure nancial reportingframework,giveatrueandfairviewofthe t orlossforthatperiod.Inpreparingeach oftheGroupand cient toshowandexplain theCompany’s nancial informationincludedonthe ned in the Companies Act 2006) ofwhich ned intheCompaniesAct2006) nancial statementsmaydiffer from ed thattheygiveatrueandfair nancial year. Under and a any d Consolidated accounts

Independent auditors’ report to the members of Rathbone Brothers Plc Consolidated income statement Consolidated statement of comprehensive income Consolidated statement of changes in equity Consolidated balance sheet Consolidated cash fl ow statement Notes to the consolidated accounts Rathbone Brothers Plc 57 Consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 58 Independent auditors’ report to the members of Rathbone Brothers Plc Independent auditors’ report to the members of Rathbone BrothersPlc Independent auditors’reporttothemembersofRathbone withthefi OpiniononothermattersprescribedbytheCompaniesAct 2006 theGroupaccounts,Article4ofIAS Regulation. • the fi Accounting GenerallyAccepted theCompanyaccountshavebeenproperlypreparedinaccordancewithUK Practice; • asadoptedbytheEU; theGroupaccountshavebeenproperlypreparedinaccordancewithIFRSs • andoftheGroup’sprofi 31December2009 • the fi In ouropinion: Opiniononfi A descriptionofthescopeanauditfi Scopeoftheauditfi require ustocomplywiththeAuditingPractices EthicalStandardsforAuditors. Board’s(APB’s) fi preparation ofthefi As explained morefullyintheDirectors’ responsibilitiesstatementsetoutonpage56,thedirectorsareresponsiblefor Respectiveresponsibilitiesofdirectorsandauditors the opinionswehaveformed. responsibility toanyoneotherthantheCompanyandCompany’smembers,asabody, forourauditwork,thisreport,orf state totheminanauditors’reportandfornootherpurpose.To thefullestextent permittedbylaw, wedonotacceptorassu Ourauditworkhasbeenundertakensothatwemightstatetothecompany’smembersthosemattersarerequired 2006. This reportismade solelytotheCompany’smembers,asabody, inaccordancewithChapter3ofPart 16oftheCompaniesAct GenerallyAcceptedAccountingPractice). (UK AccountingStandards been appliedinthepreparationofCompanyaccountsisapplicablelawandUK The fi asadoptedbytheEU. law andInternationalFinancialReportingStandards(IFRSs) to 113.The fi We haveauditedthefi theinformationgiveninDirectors’reportforfi • and thepartofRemunerationreporttobeauditedhasbeenproperlypreparedinaccordancewithCompaniesAct2006; • In ouropinion: nancial statements in accordance with applicable law and International Standards on Auditing (UK andIreland).Those standards nancial statementsinaccordancewithapplicablelawandInternationalStandardsonAuditing(UK nancial statements have been prepared in accordance with the requirements of the Companies Act 2006; and,asregards nancial statementshavebeenpreparedinaccordance withtherequirementsofCompaniesAct2006; nancial statementsgiveatrueandfairviewof thestateofGroup’sandCompany’saffairsasat nancial statements. nancial nancial reportingframeworkthathasbeenappliedinthepreparationofGroupaccountsisapplicable nancial statements nancial statementsandforbeingsatisfi nancial statements of Rathbone Brothers Plc for the year ended 31 December 2009 setoutonpages60 BrothersPlcfortheyearended31December 2009 nancial statementsofRathbone nancial statements nancial statements is provided on the APB’s websiteatwww.frc.org.uk/apb/scope/UKP. nancial statementsisprovidedontheAPB’s t fortheyearthenended; nancial yearforwhich thefi ed thattheygiveatrueandfairview. Ourresponsibilityistoauditthe nancial statementsarepreparedisconsistent nancial reportingframeworkthathas me or

for and on behalf of KPMG Audit Plc,StatutoryAuditor for andonbehalfofKPMG I Cummings(SeniorStatutoryAuditor) CombinedCodespecifi June2008 thepartofCorporategovernancereportrelatingtoCompany’scompliancewithnineprovisions • thedirectors’statement,setoutonpage56,inrelationtogoingconcern;and • Under theListingRuleswearerequiredtoreview: wehavenotreceivedalltheinformationandexplanations werequireforouraudit. • certaindisclosuresofdirectors’remunerationspecifi • accountingrecordsandreturns;or theCompanyfi • branches notvisitedbyus;or adequateaccountingrecordshavenotbeenkeptbytheCompany, orreturnsadequateforouraudithavenotbeenreceivedfrom • wearerequired toreportyouif,inouropinion: Under theCompaniesAct2006 We havenothingtoreportinrespectofthefollowing: Mattersonwhich wearerequiredtoreport byexception 23 February 2010 8 SalisburySquare,London EC4Y8BB Chartered Accountants nancial statementsandthepartofRemunerationreporttobeauditedarenotinagreementwith ed forourreview. ed bylawarenotmade;or

Rathbone Brothers Plc 59 Independent auditors’ report to the members of Rathbone Brothers Plc Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 60 Consolidated income statement for theyearended31December2009 Consolidated incomestatement The accompanyingnotesformanintegralpartoftheConsolidatedaccounts. Fee andcommissionincome holders oftheCompany: Earnings persharefortheperiodattributabletoequity – basic – basic Profi (Loss)/profi Discontinued operations Profi Profi Operating income Net feeandcommissionincome Net interestincome Interest andsimilarincome the periodattributabletoequityholdersofCompany: Earnings persharefromprofi – diluted Dividends paidandproposedfortheyear(£'000) Dividends paidandproposedfortheyearperordinaryshare(p) Loss recognisedonre-measurementofassetsthedisposalgroup Income taxcrediton(loss)/profi Other operatingexpenses Other operatingincome Net tradingincome Taxation Operating expenses Transaction costs Amortisation ofclientrelationships Additional levyforFinancialServicesCompensationScheme Dividend income Fee andcommissionexpense Interest expense andsimilarcharges Net lossfromdiscontinuedoperations – diluted tatrtxfo otnigoeain 20,197 19,628 29,468 t fortheperiodattributabletoequityholdersofCompany t aftertaxfromcontinuingoperations t beforetaxfromcontinuingoperations t beforetaxfromdiscontinuedoperations t fromcontinuingoperationsfor t beforetaxfromdiscontinuedoperations Note 17 17 12 12 11 10 9 7 7 6 6 6 5 4 103,735 116,757 (84,311) (87,289) 96,384 46.85p 18,496 18,496 45.53p 45.55p 42.00p 46.87p 21,502 21,502 18,159 18,159 (3,006) (1,967) (9,271) (7,351) 1,439 1,439 (569) (391) (229) (211) (782) £’000 358 358 2009 80 33 restated (note1) 131,166 131,166 106,656 (88,860) (86,146) (12,680) (13,421) (37,140) (1,404) (1,310) 42,306 42,306 98,091 28,885 28,885 68,115 68,115 19,000 44.09p 30,975 30,975 44.45p 42.00p 17,984 67.02p (9,885) 67.57p (8,565) 1,486 1,486 2,666 2,666 480 134 129 £’000 2008 – for theyearended31December2009 Consolidated statementofchanges inequity for theyearended31December2009 Consolidated statementofcomprehensiveincome ot fsae sudprhsd (,2)(1,728) (1,728) – taxonshare-basedpayments – costsofsharesissued/purchased Issue ofsharecapital At 1 January 2009 2,143 28,957 31,835 2,119 786 34,740 118,791 184,631 184,631 118,791 17,120 34,740 18,968 786 (1,848) 1,001 – taxonshare-basedpayments 2,119 – costsofsharesissued/purchased (2,849) 31,835 28,957 – transfer toliabilitiesforcash 2,143 – valueofemployeeservices Share-based payments: on disposalofsubsidiaries Reclassifi Issue ofsharecapital 184,750 100,677 Dividends paid 54,181 the period (215) Total comprehensiveincomefor 4,968 At 1January2009 49,428 27,758 2,134 13,193 Dividends paid for theperiod Total comprehensiveincome At 1January2008 (6,435) attributable toequityholdersoftheCompany Total comprehensiveincomefortheyear, netoftax Other comprehensiveincomefortheyear, netoftax – availableforsaleinvestmentsecurities Exchange translationdifferences Other comprehensiveincome: Profi Deferred taxrelatingtocomponents ofothercomprehensiveincome: – actuarialgainsandlosses – netlossfromchanges infairvalue Revaluation ofavailableforsaleinvestmentsecurities: Actuarial lossonretirementbenefi annso ipslo usday(753 1,9)1,9 – 17,593 (17,593) (17,593) earnings ondisposalofsubsidiary Transfer ofmergerreservetoretained At 31 December 2009 2,165 31,756 31,835 2,077 245 34,157 114,411 182,489 182,489 114,411 34,157 245 2,077 31,835 31,756 2,165 At 31December2009 – valueofemployeeservices Share-based payments: settled awards t fortheyear cation oftranslationreserve t obligation t Note 26 11 19 26 11 19 8 8 capital Share £’000 2279 2,821 22 2,799 9 1,199 1,208 1,208 9 1,199 premium Share £’000 reserve Merger £’000 Available Note for sale reserve 19 16 25 £’000 4)(8)(2)13,417 13,193 (224) (182) (42) Translation reserve (359) (359) 359 – 359 (359) (359) £’000 19,628 (8,626) 2,415 (182) £’000 reserves 2009 (59) 17 £’000 other Total 1,299 1,299 1,299 (17,503) (17,503) (,9)(1,096) (119) (1,096) (119) 1,219 1,219 (18,066) (18,066) Retained earnings 55 (515) (515) £’000 9)(94) (94) 19,000 17,120 (1,880) (3,957) 1,108 1,001 equity £’000 £’000 2008 Total (44) 12

Rathbone Brothers Plc 61 Consolidated statement of comprehensive income Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 62 Consolidated balance sheet he xctv Financedirector R PStockton The accompanyingnotesformanintergralpartoftheConsolidatedaccounts. Company registednumber:1000403. Chief executive A DPomfret as at31December2009 Consolidated balancesheet Approved bytheBoardofDirectorson23February 2010 Loans andadvances tobanks Retained earnings Other reserves oa iblte n qiy1,037,088 Total liabilitiesandequity Total equity Share premium Share capital Equity Total liabilities Retirement benefi Liabilities ofdisposalgroupsclassifi Settlement balances Deposits bybanks Liabilities Total assets Prepayments, accrued incomeandotherassets Deferred taxasset Intangible assets Settlement balances Cash andbalancesatcentralbanks Assets Current taxliabilities Accruals, deferred income,provisionsandotherliabilities Due tocustomers Property, plantandequipment Assets ofdisposalgroupsclassifi – heldtomaturity – availableforsale Investment securities Loans andadvances tocustomers t obligations t ed asheldforsale ed asheldforsale Note 25 10 23 22 21 20 19 18 17 10 16 16 15 14 13 26 26 1,037,088 854,599 854,599 694,000 694,000 182,489 182,489 766,361 766,361 114,411 86,932 86,932 92,661 34,157 34,157 46,875 22,157 81,973 31,756 29,878 26,745 17,305 1,603 1,603 9,413 2,414 2,165 5,676 7,379 £’000 315 2009 – – 1,044,351 1,125,816 1,310,447 1,310,447 184,631 118,791 175,973 874,979 38,646 38,646 14,048 14,048 68,232 81,991 39,412 42,450 28,957 15,751 34,740 4,008 4,008 2,483 6,035 9,201 6,816 5,813 2,143 5,723 351 £’000 2008 for theyearended31December2009 Consolidated cashfl Interest received Issue ofordinaryshares Tax paid – netdecreaseinaccruals,deferred income,provisionsandotherliabilities Impairment lossesonloansandadvances e dces)ices ncs n aheuvlns(115,621) 176,380 Cash andcashequivalentsattheendofperiod Net (decrease)/increaseincashandequivalents Net cashusedinfi Purchase ofsharesforshare-basedschemes Cash fl Net cashgeneratedfrom/(usedin)investingactivities Acquisition ofbusinesses,netcashacquired Cash fl Net cash(outfl Profi Cash fl Disposal ofbusinesses,netcashtransferred – net(increase)/decreaseloansandadvancestobankscustomers Changes inoperatingassetsandliabilities: Discontinued operations Defi Effect ofexchange ratechanges oncashand equivalents Cash andcashequivalentsatthebeginningofperiod Dividends paid Proceeds fromsaleandredemptionofinvestmentsecurities Purchase ofinvestmentsecurities Proceeds fromsaleofpropertyandequipment Purchase ofproperty, equipmentandintangibleassets Cash (usedin)/generatedfromoperations – netincrease/(decrease)insettlementbalancecreditors – net(decrease)/increaseinamountsduetocustomersanddepositsbybanks – netdecreaseprepayments,accruedincomeandotherassets – net(increase)/decreaseinsettlementbalancedebtors Interest paid Share-based paymentcharges Defi Depreciation andamortisation Profi Net interestincome Discontinued operations ned benefi ned ned benefi ned t beforeincometaxfromcontinuingoperations t ondisposalofplantandequipment ows fromfi ows frominvestingactivities ows fromoperatingactivities t pensioncontributionspaid t pensionscheme charges ow)/infl nancing activities nnigatvte (16,341) nancing activities o rmoeaigatvte (275,660) ow fromoperatingactivities ow statement ow Note 25 15 32 11 32 16 16 32 8 8 (1,796,282) 1,977,261 (265,751) (257,725) 139,044 139,044 255,021 (18,496) (18,066) (42,557) 29,468 29,468 49,315 49,315 33,819 (3,889) (1,554) (1,341) (1,522) (9,625) (3,319) (6,788) (8,723) 5,340 5,340 8,109 8,109 3,436 1,219 1,852 2,193 (468) (356) £’000 2009 (20) 22 65 (4) – (2,545,080) 2,435,375 restated (note1) (105,525) 163,240 163,240 255,021 214,220 174,648 (10,940) (18,023) (11,311) (30,975) (17,503) (37,970) 39,692 39,692 42,306 16,340 16,340 90,162 33,169 68,147 49,370 (2,911) (2,715) (5,878) (1,728) 1,109 1,109 1,208 1,299 4,914 5,822 1,942 4,614 2,247 (266) (734) 151 £’000 2008 (45) 52

Rathbone Brothers Plc 63 Consolidated cash fl ow statement Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 64 Notes to the consolidated accounts • IFRIC 18,‘Transfers ofassetsfromcustomers’ IFRIC • 17, IFRIC ‘Distributionsofnon-cash assetstoowners’ • operations oftheGroup: periods beginningonorafter1January2010later but which, intheopinionofdirectors,arenotrelevanttot thatarealsomandatoryfortheGroup’saccounting The ortheIFRIC followingstandardsandinterpretationsissuedbytheIASB ‘Consolidatedandseparatefi IAS 27(revised2008), • ‘Businesscombinations’ 3(revised2008), IFRS • to impactmateriallythefi 1 January2010orlaterperiodsandhavenotbeenearlyadopted bytheGroup.They arenotlikely, intheopinionof direct The followingstandardsandinterpretationsarealsomandatoryfortheGroup’saccountingperiodsbeginningonorafter 16,‘Hedgesofanetinvestmentinforeignoperation’ IFRIC • 15,‘Agreements fortheconstructionofrealestate’ IFRIC • (amendment),‘FinancialInstruments:Recognitionandmeasurement’ IAS 39 • –‘Puttable fi IAS 32(amendment),‘FinancialInstruments:Presentation’/ IAS 1(amendment).Presentation offi • 2(amendment), ‘Sharebasedpayments’ IFRS • IAS 23(amendments),‘Borrowingcosts’ • (amendment),‘Impairmentofassets’ IAS 36 • the Group,althoughtherewasnoimpactonconsolidatedresultsorfi The followingstandardsandinterpretationsareeffective forthefi respectoffairvaluemeasurementsandliquidityrisk. 7, AmendmentstoIFRS ‘Financialinstruments disclosures’. 7expand thedisclosurerequiredin The amendmentstoIFRS • decisionmaker. The newstandardhasnotrequiredtheGrouptochange itsreportedoperatingsegments. basisastheinformationthatinternallyisreportedtoGroupExecutiveCommittee, which istheGroup’s chief operating 8,‘Operating segments’. The IFRS newstandardrequiressegmentinformationtobedeterminedandpresentedonthesame • comprehensive allownerchanges inequity, whereasallnon-ownerchanges inequityarepresentedtheconsolidatedstatementof income. andcontentofthefi IAS 1(revised2007), ‘Presentation offi • fi In thecurrentyearfollowingnewandrevisedstandardshavebeenadoptedaffected theamountsreportedinthese Developments inreportingstandardsandinterpretations details, includingtheimpactonfi 5.AsrequiredbytheStandard,comparativebalancesforConsolidatedbalancesheethavenotbeenrestated.Furthe IFRS related noteswhereapplicabletorefl The comparative balances havebeenrestatedintheConsolidatedincomestatement,cashfl Changes inaccountingpoliciesanddisclosure to115. GAAP);thesearepresentedonpages108 (UK principles intheUK The Companyhaselectedtoprepareitsindividualaccountsinaccordancewithgenerallyacceptedaccounting (IFRS). EU The consolidated accountshavebeenpreparedinaccordancewithInternationalFinancialReportingStandardsasadoptedbythe Principal BrothersPlc(the‘Company’)isapubliccompanyincorporatedinGreatBritain. accountingpolicies Rathbone 1 Notes totheconsolidatedaccounts nancial statements. nancial nancial instrumentsandobligationsarisingon liquidation’ nancial statements.AsaresulttheGrouppresentsinConsolidatedstatementofchanges inequity nancial statementsintheperiodofinitialapplication: nancial statements,aregiveninnote10. ect thedisposalorplanneddiscontinuationofcertainsubsidiaryentitiesinaccordancewith nancial statements’. IAS 1(2007) has introducedanumberofchanges intheformat nancial statements’ nancial rst timeinthecurrentfi nancial position: nancial nancial yearandhavebeenadoptedby nancial statements nancial ow statementandthe he ors, r directly orindirectly, anyoftheentity’ssharecapital. effectively controlledbytheCompany, The until 12November2009. Companydidnotown, throughrepresentationontheboard, The consolidatedfi of subsidiarieshavebeenchanged wherenecessarytoensureconsistencywiththepoliciesadoptedbyGroup. losses arealsoeliminatedunlessthetransactionprovidesevidenceofimpairmentassettransferred. Accountingpolicies Intercompany transactions,balancesandunrealisedgainsontransactionsbetweenGroupcompaniesareeliminated.Unrealised is recogniseddirectlyintheincomestatement. recorded asgoodwill.Ifthecostofacquisitionislessthanfairvaluenetassetssubsidiaryacquired, interest. The excess ofthecostacquisitionoverfairvalueGroup’sshareidentifi a businesscombinationaremeasuredinitiallyattheirfairvaluestheacquisitiondate,irrespectiveofextent ofanym plus costsdirectlyattributabletotheacquisition.Identifi measured asthefairvalueofassetsgiven,equityinstrumentsissuedandliabilitiesincurredorassumedatdateex The purchase methodofaccountingisusedtoaccountfortheacquisitionsubsidiariesbyGroup.The costofanacquisiti is transferred totheGroup.They aredeconsolidatedfromthedatethatcontrolceases. when assessingwhetheranentityisasubsidiaryoftheCompany. Subsidiariesarefullyconsolidatedfromthedateonwhich con half ofthevotingrights.The existence andeffect ofpotentialvotingrightsthatarecurrentlyexercisable orconvertiblear Subsidiaries areallentitiesinwhich theCompanyhasacontrollinginterest,generallyaccompanyingshareholdingofmoreth (its subsidiaries),togetherthe‘Group’, madeupto31Decembereach year. The consolidated fi Principal accountingpolicies Basis ofconsolidation 1 revaluation increase. unless therelevant assetiscarriedatarevalued amount,inwhich casethereversalofimpairment lossistreatedasa for theassetorcashgenerating unitinprioryears.Areversalofanimpairmentlossisrecognised asincomeimmediately, carrying amountdoesnotexceed thecarryingamount thatwouldhavebeendeterminedhadnoimpairmentloss recognised instruments, orcashgenerating unitisincreasedtotherevisedestimateofitsrecoverableamount, butsothattheincreased Where animpairment loss(excluding goodwill)subsequentlyreverses,thecarryingamountof asset,except for equity expense immediately. amount oftheassetorcashgeneratingunitisreducedtoitsrecoverable amount.Impairmentlossesarerecognisedasan If therecoverableamountofanassetorcashgeneratingunitis estimatedtobelessthanitscarryingamount,the that objectiveevidenceofimpairmentisidentifi of availableforsalesecuritiesiscalculatedasthecumulativeloss thathasbeenpreviouslyrecogniseddirectlyinequityat as thepresentvalueofestimatedfuturecashfl have notbeenadjusted.The recoverableamountofheldtomaturityinvestment securitiesandloansreceivablesiscalculate market assessmentsofthetimevaluemoneyandrisks specifi in use,theestimatedfuturecashfl The recoverableamountofnon-fi generating unittowhich theassetbelongs. does notgeneratecashfl (if any).Heldtomaturityinvestmentsecuritiesandloansreceivablesareconsideredindividuallyforimpairment.Where an any such indicationexists, therecoverableamountofassetisestimatedinordertodetermineextent oftheimpairment Financial assetsareassessedatthereportingdateorifthereisobjectiveevidenceofimpairmentduringaccountingperio impairment andannually. Intangibleassetswithfi Goodwill andotherintangibleassetswithindefi Impairment basis ofaccountinginpreparingthefi adequate resourcestocontinueinoperationalexistence fortheforeseeablefuture.Thus theycontinuetoadoptthegoingconce The directorshave,atthetimeofapprovingfi been appliedconsistentlytoallperiodspresentedintheconsolidatedaccounts. The principalaccountingpoliciesadoptedaresetoutbelow. The accountingpoliciessetoutbelowhave,unlessotherwisestate The fi Basis ofpresentation nancial statementshavebeenpreparedonthe historicalcostbasis,except fortherevaluationofcertainfi nancial statementsincorporatethefi nancial statementsincorporatethefi ows thatareindependentfromotherassets,the Groupestimatestherecoverableamountofcash nancial assetsisthehigheroffairvaluelessanycosttosellandinuse.Inassessing ows arediscountedtotheirpresentvaluesusingapre-taxdiscountratethatrefl nancial statements.Further detailiscontainedinthebusinessreview onpage23. continued ed. nite useful lives are tested for impairment both whenthereisanindicationof nite usefullivesaretestedforimpairmentboth ows, discountedattheeffective interestrateoftheassetonrecognition.Impairment nite livesaretestedforimpairmentwherethere isanindicationofimpairment. nancial statements,areasonableexpectation thattheCompany andtheGrouphave able assetsacquiredandliabilitiescontingentassumedin nancial statements of Rathbone InternationalFinanceB.V., nancial statementsofRathbone which was nancial statementsoftheCompanyandentitiescontrolledby c totheassetforwhich theestimatesoffuturecashfl able netassetsacquiredis nancial instruments. nancial ects current ects difference e considered thetime inority ows change, asset d. If loss an one on is d, d rn trol

Rathbone Brothers Plc 65 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 66 Notes to the consolidated accounts to aneventoccurringaftertheimpairmentlosswasrecognisedinprofi or loss.Ifthefairvalueofadebtinstrumentclassifi impairment loss. income isrecognisedusingtherateofinterestusedtodiscountfuturecashfl Once afi of theeffective interestrate,transactioncostsandallotherpremiums ordiscounts. losses. The calculationincludesallfees andinterestpaidorreceivedbetweenpartiestothecontractthatareanintegralpa the Groupestimatescashfl a shorterperiodtothenetcarryingamountoffi discounts estimatedfuturecashpaymentsorreceiptsthroughtheexpected life ofthefi allocating theinterestincomeorexpense overtherelevantperiod.The effective interestrateisthethatexact An impairmentlossinrespectofaninvestmentequityinstrumentsclassifi related objectivelytoaneventoccurringaftertheimpairmentlosswasrecognised. An impairmentlossinrespectofheldtomaturitysecuritiesorloansandreceivablesisreversedifthesubsequentincreaseca on astraightlinebasisovertheestimatedaveragelife oftheunitholding. income isrecognisedontheperformanceofthatservice.Otherretainedinitialcharges aredeferred and recognisedasincome To theextent thatretainedinitialcharge incomereceivedonthesaleofunitsarises from anidentifi Commissions receivableandpayableareaccountedforintheperiodwhich theyareearned. management fees arerecognisedrateablyovertheperiodserviceisprovided. Portfolio andothermanagementadvisoryservicefees arerecognisedovertheperiodserviceisprovided.Asset Fees andcommissions of anyleaseincentives. a straightlinebasisoverthetermoflease.Lease expense recognisedintheincomestatementisadjustedforimpact Group areclassifi Lease agreementswhich donottransfer substantiallyalloftherisksandrewardsownershipleasedassetsto Operating leases dividends arerecognisedwhenpaid. Dividend incomefromfi Dividend income The effective interestmethodisaofcalculatingtheamortisedcostfi fi and foravailablesaledebtinstrumentsusingtheeffective interestmethod.Interestpayableandreceivableonderivative Interest incomeandexpense arerecognisedasearnedintheincomestatementforallinstrumentsmeasuredat amortised cost Net interestincome Principal accountingpolicies 1 eshl rpry overthelease term income statement. Gains andlossesondisposalsare determinedbycomparingproceedswiththecarryingamount. These areincludedinthe The assets’residuallivesarereviewed,andadjustedifappropriate,ateach balancesheetdate. overthreetofi Plant, equipmentandcomputerhardware: Leasehold property: using thestraightlinemethod,onfollowingbases: Depreciation ischarged soasto writeoffthecostofassetstotheirestimatedresidualvalueoverusefulliv includes expenditure thatisdirectlyattributabletotheacquisitionofitems. All property, plantandequipmentisstatedathistoricalcostlessaccumulated depreciationandimpairmentlosses.Historical Property, plantandequipment nancial instrumentsanddividendsreceivablefrommoneymarketfundsareincludedwithinnetinterestincome. nancial assetoragroupofsimilarfi ed asoperatingleases.Payments madeunderoperatingleases arerecognisedintheincomestatementon nal dividendsonequitysecuritiesisaccounted foronthedatesecuritybecomesex-dividend. Interim ows consideringallcontractualtermsofthefi continued nancial assetshasbeenwrittendownasaresultofanimpairmentloss,interest ed asavailableforsaleincreasesandtheincreasecanbeobjectivelyrelated nancial assetorfi ve years ve nancial liability. When calculatingtheeffective interestrate, t orloss,theimpairmentisreversedthroughprofi nancial instrumentbutdoesnotconsiderfuturecredit ed asavailableforsaleisnotreversedthroughprofi nancial assetorafi ows forthepurposeofmeasuring nancial instrumentor, whenappropriate, able brokerageservice,the nancial liabilityandof t orloss. ly es, rt cost n be t yield basis. measured atamortisedcostusingtheeffective interestmethod,lessanyimpairment,withrevenuerecognisedonaneffective receivables orthattheGrouphasclassifi Group’s managementhasthepositiveintentionandabilitytohold tomaturity, otherthanthosethatmeetthedefi Held-to-maturity investmentsarenon-derivativefi c Held-to-maturity the receivable.Loans andreceivables aremeasuredatamortisedcostusingtheeffective interestmethod,lessany impairment. market. They arisewhentheGroupprovidesmoney, goodsorservicestoadebtorpurchases aloan withnointentionoftradin Loans andreceivablesarenon-derivativefi Loans andreceivables b reported withinotherassetsorliabilities. so designated.Derivatives,which arecategorised asfairvaluethroughprofi at inception.Afi This categoryhastwosub-categories:fi Financialassetsatfairvaluethrough profi a at initialrecognition.Financialassetsareinitiallyrecognisedfairvalue. receivables, held-to-maturityinvestmentsandavailableforsalefi impairment testing.Cashgeneratingunitsareidentifi Group’s segments,astheserepresentthelowestlevelwithinGroupatwhich managementmonitorgoodwillforpurposesof subsequently reversed.Goodwillarisingonacquisitionisallocatedtogroupsofcashgeneratingunitsthatcorrespondwiththe circumstances indicatethatitmightbeimpaired.Anyimpairmentisrecognisedimmediatelyintheprofi Goodwill isrecognisedasanassetandreviewedforimpairmentatleastannually, orwhenother occasionsorchanges in identifi Goodwill arisingonconsolidationrepresentstheexcess ofthecostacquisitionoverGroup’sinterestinfairvalue a Goodwill Principal accountingpolicies Intangible assets 1 The Groupclassifi Financial assets lives (tentofi Amortisation iscalculatedusingthestraight-linemethodtoallocatecostofclientrelationshipsovertheirestimated recognised atfairvalue.Clientrelationshipshaveafi Client relationshipsacquiredareinitiallyrecognisedathistoricalcost.Those inrespectofbusinesscombinationsareinitia c Client relationships as anexpense asincurred. Costs associatedwithdevelopingormaintainingcomputersoftwareprogramsthatarenotrecognisedasassets recognised asassetsareamortisedusingthestraight-linemethodovertheirusefullives(notexceeding fouryears). recognised asintangibleassetswhentherecognitionrequirementsofIAS aremet.Computersoftwaredevelopmentcosts 38 Costs thataredirectlyassociatedwiththeproductionofidentifi software. These costsareamortisedonthebasisofexpected usefullives(threetofouryears). Acquired computersoftwarelicencesarecapitalisedonthebasisofcostsincurredtoacquireandbringusespecifi Computersoftware andsoftware developmentcosts b to beingtestedforimpairmentatthatdate. GAAPamountssubjec hasbeenretainedatthepreviousUK Goodwill arisingonacquisitionsbeforethedateoftransitiontoIFRS of theprofi On disposalofasubsidiarytheattributedamountgoodwillthathasnotbeensubjecttoimpairmentisincludedindeterm that arelargelyindependentofthecashinfl able assets,liabilitiesandcontingentofasubsidiaryatthedateacquisition. t orlossondisposal. fteen years). fteen nancial assetisclassifi es itsfi nancial assetsinthefollowingcategories:fi ed inthiscategoryifacquiredprincipallyforthe purposeofsellingintheshorttermorif nancial assetsheldfortrading,andthosedesignated atfairvaluethroughprofi ed asavailableforsaleorfairvaluethroughprofi nancial assetswithfi continued ows fromotherassetsorgroupsofassets. nancial assetswithfi t orloss nite usefullife andarecarriedatcostlessaccumulatedamortisation. ed asthesmallestidentifi able anduniquesoftwareproductscontrolledby theGroupare xed ordeterminablepaymentsthatarenotquotedinanactive nancial assets.The classifi nancial assetsatfairvaluethroughprofi xed ordeterminablepaymentsandfi t orloss,arealsocategorisedasheldfortrading and able groupofassetsthatgeneratescashinfl t orloss.Heldtomaturityinvestmentsare cation offi nancial assetsisdetermined t andlossisnot xed maturitiesthatthe t orloss,loansand nition ofloansand t orloss lly useful ows of the c

ination g t

Rathbone Brothers Plc 67 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 68 Notes to the consolidated accounts used bymarketparticipants. recent arm’slengthtransactions,discountedcashfl is notactive(andforunlistedsecurities),theGroupestablishesfairvaluebyusingvaluationtechniques. These includethe The fairvaluesof quotedfi using theeffective interestmethodisrecognisedintheincomestatement. cumulative gainorlosspreviouslyrecognisedinequityshouldbetheincomestatement.However, interestcalcula sale fi in theincomestatementperiodwhich theyarise.Gainsandlossesarisingfromchanges inthefairvalueofavailable and lossesarisingfromchanges inthefairvalueof‘fi Loans andreceivables andheld-to-maturityinvestmentsarecarriedatamortisedcostusingtheeffective interestmethod.Gains Available forsale fi expired orbeeneffectively transferred, orwherethe Grouphastransferred substantiallyallrisksandrewardsofownership. value throughprofi Financialassetsareinitiallyrecognisedatfairvalueplustransactioncostsforallfi to theborrowers. on tradedate–thewhich theGroupcommitstopurchase orsell theasset.Loans arerecognisedwhencashisadvanced Purchases andsalesoffi response toneedsforliquidityorchanges ininterestrates,exchange ratesorequityprices. other categories.Available forsaleinvestmentsarethoseintendedtobeheldanindefi Available forsale fi Available forsale d notifi Provisions forrestructuringcostsarerecognisedwhentheGrouphasadetailedformalplanwhich hasbee recognised withininterestexpense. of thetimevaluemoneyandrisksspecifi of theexpenditures expected toberequiredsettletheobligationusingapre-taxratethatrefl probable willresultinanoutfl Provisions arerecognisedwhentheGrouphasapresentobligation(legalorconstructive)asresultofpasteventwhich it Provisions in theperiodwhich theyareincurred. by takingintoaccountanyissuecostsanddiscountsorpremiaonsettlement.Borrowingarerecognisedasanexpense aresubsequentlymeasuredatamortised costusingtheeffectiveand borrowings interestratemethod.Amortisedcostiscalculat areinitiallyrecognisedatthefairvalueofconsiderationreceived.AfterAll depositsandborrowings initialrecognition Deposits andborrowings Principal accountingpolicies 1 translated usingtheexchange rateappliedonthedateofacquisition. asnon-monetary foreigncurrencyitemsandtheyare currency arisingonacquisitions beforethedateoftransitiontoIFRS Group haselectedtotreatgoodwill andfairvalueadjustmentsdenominatedinacurrencyother thantheGroup’sfunctional entity andtranslatedattheclosing rate.Gainsandlossesarisingontranslationaretakentothe Group’stranslationreserve Goodwill andfairvalueadjustments arisingontheacquisitionofaforeignentityaretreatedas assetsandliabilitiesofthe translation differences are transferred toequityintheperiodwhich theoperationisdisposed. rates fortheperiod.Exchange differences arising,ifany, arerecognised inequitywithintheGroup’stranslationreserve.Su currency atexchange ratesprevailing onthebalancesheetdate.Incomeandexpense itemsaretranslatedattheaverageexchang On consolidation,theassetsandliabilitiesofGroup’soverseas operationsaretranslatedintotheGroup’spresentational non-monetary assetsandliabilitieswherethechanges infairvaluearerecogniseddirectlyequity. Gains andlossesarisingonretranslationareincludedinnetprofi the ratesprevailingatdatewhenfairvaluewasdetermined. balance sheetdate.Non-monetaryfi sheet date,monetaryassetsandliabilitiesthataredenominated inforeigncurrenciesareretranslatedattheratesprevailing Group entity’sfunctionalcurrencyarerecordedattheratesof exchange prevailing onthedatesoftransactions.At each b The Company’sfunctionalandtheGroup’spresentationalcurrencyissterling.Transactions incurrenciesotherthantherelevan Foreign currencies ed toaffected parties. nancial assetsarerecogniseddirectlyinequity, untilthefi t orloss.Financialassetsarederecognisedwhentherightstoreceivecashfl nancial assetsandfi nancial assetsarenon-derivativesthateitherdesignatedinthiscategoryornotclassifi nancial assetsatfairvaluethroughprofi nancial instrumentsinactivemarketsarebasedoncurrentbidprices.Ifthemarketforafi ow ofeconomicbenefi nancial assetscarriedatfairvaluethataredenominatedinforeigncurrenciestranslated nancial assetsatfairvaluethroughprofi continued c totheobligation.The increaseintheprovisionduetopassage oftimeis ow analysis,optionpricingmodelsandothervaluation techniques commonly ts thatcanbereliablyestimated.Provisions aremeasuredatthe presentvalue nancial assetsatfairvaluethroughprofi nancial assetissold,derecognisedorimpairedatwhich timethe t orlossfortheperiod,except forexchange differences arisingon t orloss,held-to-maturityandavailableforsalearerecognised t orlossaresubsequentlycarriedatfairvalue. nite periodoftime,which maybesoldin ects currentmarketassessments ows fromthefi t orloss’categoryareincluded nancial assetsnotcarriedatfair ed inanyofthe nancial assetshave nancial asset nancial , deposits foreign use of ch ch . The onthe for is alance t ted n

ed e intends tosettleitscurrenttaxassetsandliabilitiesonanetbasis. Deferred taxassetsandliabilitiesareoffsetwhentheyrelatetoincometaxesleviedbythesame taxationauthorityandtheG with inequity. income statement,except whenitrelatestoitemscreditedorcharged directlytoequity, inwhich casethedeferred taxisals and areexpected toapplywhentheliabilityissettledorassetrealised.Deferred taxischarged orcreditedint Deferred taxisdeterminedusingrates(andlaws)thathavebeenenactedorsubstantivelybythebalancesheetdate probable thatsuffi The carryingamountsofdeferred taxassetsarereviewedateach balancesheetdateandreducedtotheextent thatitisnolon temporary difference intheforeseeablefuture. except wheretheGroupisabletocontrolreversaloftemporarydifference anditistheGroup’sintentionnottorever Deferred taxliabilitiesarerecognisedfortaxabletemporarydifferences arisingoninvestmentsinsubsidiariesandassociates b fromtheinitialrecognitionofotherassetsandliabilitiesinatransaction, which affects neitherthe taxprofi (b) fromtheinitialrecognitionofgoodwillforwhich amortisationisnotdeductiblefortaxpurposes;or (a) may beutilised.Such assetsandliabilitiesarenotrecognisedifthetemporarydifference arises: are recognisedtotheextent thatitisprobabletaxableprofi computation oftaxableprofi between thecarryingamountofassetsandliabilitiesinfi Deferred taxisaccountedforusingthebalancesheetliabilitymethodinrespectoftemporarydifferences arisingfromdiffere balance sheetdate,andanyadjustmenttotaxpayableinrespectofpreviousyears. Current taxistheexpected taxpayableonthetaxableincomeforyear, usingtaxratesenacted orsubstantivelyenactedat extent thatitrelates toitemsrecogniseddirectlyinequity, inwhich caseitisrecognisedinequity. Tax ontheprofi Taxation Payments todefi liabilities willbemetbyinsurancepolicies. for deathinservicebenefi Death inservicebenefi contributions totheplan. of planassets.Anyassetresultingfromthiscalculationislimitedtothepresentvalueavailablerefundsandreductionsi The amountrecognised inthebalancesheetrepresentspresentvalueofdefi straight-line basisovertheaverageperioduntilamendedbenefi Past servicecost isrecognisedimmediatelytotheextent thatthebenefi occur, inthestatementofcomprehensiveincome. valuations beingcarriedoutateach balancesheetdate.Actuarialgainsandlossesarerecognisedinfulltheperiodwhi The costofproviding benefi Principal accountingpolicies Retirement benefi 1 defi For thepurposesofConsolidatedcashfl Cash equivalentscompriseshort-termhighlyliquidinvestments withamaturityoflessthanthreemonthsfromthedateacqui Cash comprisescashonhandanddemanddepositswhich maybeaccessedwithoutpenalty. Cash andcashequivalents ned above, net of outstandingbankoverdrafts. ned above, accounting profi t orlossfortheyearcomprisescurrentanddeferred tax.Tax isrecognisedintheincomestatementexcept tothe ned contributionretirementbenefi cient taxableprofi t obligations ts areprovidedtoallemployeesthroughthepensionschemes. The amountrecognisedinthebalancesheet t, otherthaninabusinesscombination. ts representsthepresentvalueofestimatedobligation,reducedbyextent towhich anyfuture ts underdefi t. Inprinciple,deferred taxliabilitiesarerecognisedforalltemporary differences and deferred tax assets ts willbeavailabletoallowallorpartoftheasset toberecovered. ned benefi ned continued ow statement,cashandequivalentsconsistofas t schemes arecharged asanexpense astheyfalldue. t plansaredeterminedusingtheprojectedunitcreditmethod,withactuarial nancial statementsandthecorrespondingtax basis usedinthe ts willbeavailableagainstwhich deductibletemporarydifferences ts becomevested. ts arealreadyvested,andotherwiseisamortisedona ned benefi ned t obligationreducedbythefairvalue t northe n future he o dealt ch they se the , nces roup the sition. ger

Rathbone Brothers Plc 69 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 70 Notes to the consolidated accounts benefi Such moniesandthecorrespondingamountsduetoclientsarenotshownonfaceofbalancesheetasGroupis The GroupholdsmoneyonbehalfofsomeclientsinaccordancewiththeClientMoneyRulesFinancialServicesAuthority. fi individuals, trusts,retirementbenefi The Groupcommonlyactsastrusteeandinotherfi Fiduciary activities each segment. allocated betweensegmentsinproportiontotheprincipalcostdriverforeach categoryofindirectcoststhatisgeneratedby Transactions betweenoperatingsegmentsarereportedwithintheincomeorexpenses forthosesegments.Indirectcostsare ataglanceonpage6.NooperatingsegmentshavebeenaggregatedintheGroup’s fi is giveninRathbones Operating segmentsareorganisedaroundtheservicesprovidedtoclients,adescriptionofbyeach segmen fi resourcesallocatedtothesegmentandassessitsperformance,forwhichCommittee tomakedecisionsabout discrete transactions withanyoftheGroup’sothercomponents,whoseoperatingresultsarereviewedregularlybyGroupExecutive in businessactivitiesfromwhich itmay earn revenuesandincurexpenses, includingrevenuesandexpenses thatrelateto Committee, which istheGroup’schief operatingdecisionmaker. Anoperating segmentisacomponentoftheGroupthatengages The GroupdeterminesandpresentsoperatingsegmentsbasedontheinformationthatisprovidedinternallytoExecutiv Segmental reporting of theliabilityisremeasuredwithanychanges infairvaluerecognisedprofi liability. At thedateonwhich theliabilityissettled,andateach balancesheetdatebetweengrantandsettlement,the For cashsettledshare-basedpayments,aliabilityisrecognisedfortheservicesreceived,measuredinitiallyatfairvalu vesting conditionsaremet.Sharespurchased andissuedarecharged directlyto equity. received arerecognisedregardlessofwhetherornotthemarketrelatedvestingconditionismet,providedthatnon-market corresponding adjustmenttoequity. Where vestingconditionsarerelatedtomarketconditions,thecharges fortheservices so thatultimately, theamountrecognisedinincomestatementrefl into accountbyadjustingthenumberofsharesorshareoptionsincludedinmeasurementcostemployeeservices included inthetermsofgrantarenottakenintoaccountestimatingfairvalue.Non-marketvestingconditions option/award andotherrelevantfactors.Exceptforthosewhich includetermsrelatedtomarketconditions,vestingconditions option, thecurrentshareprice,riskfreeinterestrate,expected volatilityoftheCompany’ssharepriceoverlif The fairvalueofthe optionsgrantedisdeterminedusingoptionpricingmodels,which takeintoaccounttheexercise priceof options grantedisrecognisedintheincomestatementovervestingperiod,withacorrespondingcredittoequity. or shareoptionsgrantedonthedateofgrant.The costoftheemployeeservicesreceivedinrespectsharesorshare equity settledshare-basedpayments,thefairvalueofservicesreceivedismeasuredbyreference tothefairvalueof The Groupengages inshare-basedpaymenttransactionsrespectofservicesreceivedfromcertainemployees.Inrelationto Principal accountingpolicies Share-based payments 1 less cumulativeamortisation,which isrecognisedoverthelife ofthecontract. measured atthehigherofbestestimateanyamountto be paidtosettletheguaranteeandamountinitiallyrecognise Financial guaranteesissuedbytheGroupareinitiallyrecognised inthebalancesheetatfairvalue.Guaranteesaresubsequent Financial guarantees nancial statements,astheyarenotassetsofthe Group. nancial informationisavailable. cially entitledthereto. t plansandotherinstitutions.Such assets,andincomearisingthereon, areexcluded fromthese continued duciary capacitiesthatresultintheholdingor placing ofassetsonbehalf ects thenumberofvestedsharesorshareoptions,witha t orlossfortheyear. nancial statements. nancial e ofthe e ofthe fairvalue shares the

ly d t e sensitivity oftheretirementbenefi respect ofretirementbenefi different tothoseforecast.IfactualeventsdeviatefromtheassumptionsmadebyGroupthenreportedsurplusordefi Long-term forecasts andestimatesarenecessarilyhighlyjudgementalsubjecttoriskthatactualeventsmaybesignifi assumptions underlyingthereporteddefi retirement benefi arangeoflong-termtrendsandmarketconditionstodeterminethevaluedefi The Groupmakes estimatesabout Retirement benefi would resultinachange intheircarryingvalueofapproximately £140,000. the likelyimpactofeconomicturmoilonJerseybusiness.Changingestimatedrepaymentdatenotesbyoneyea repayment date.Intheyear, management’sestimateofthelikelyrepaymentdatehasbeenputback from2013to2015,basedon The carryingvalue ofthenoteshasbeencalculatedas£3,267,000 usingadiscountedcashfl refi Theof theGroup’sJerseytrustoperationsin2008. notesarerepayableontheoccurrenceofcertainevents,principally As describedinnote15,theGrouphasissuedvendorloannotes(‘notes’)withanominalvalueof£5,000,000toacquirer Vendor loannotes expectations offuture eventsthatarebelievedtobereasonableunderthecircumstances. year. Estimatesandjudgementsarecontinuallyevaluatedbasedonhistoricalexperience andotherfactors,including Criticalaccountingjudgementsandkey sourcesofestimationanduncertainty The Groupmakes estimatesandassumptionsthataffect thereportedamountsofassetsandliabilitieswithinnext fi 2 nancing oftheoperationsdisposedof. t schemes, basedontheGroup’sexpectations ofthefutureandadvicetakenfromqualifi t obligations t obligationsmaybemateriallydifferent. The historyofexperience adjustmentsandinformationon the t obligationtochanges inunderlyingestimatesissetoutnote 25. cit of£9,413,000aregiveninnote25. ow modelbasedontheestimated ed actuaries.The principal nancial cit onits cantly cit in cit r

Rathbone Brothers Plc 71 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 72 Notes to the consolidated accounts Group ExecutiveCommittee. the presentationforinternalreporting.The informationpresentedinthisnotefollowsthepresentationforinternalreporting Certain itemsofincomearepresentedwithindifferent categoriesofoperatingincomeinthefi and Trust andTax Services.These segmentsarethebasisonwhich theGroupreportsits performancetotheExecutiveCommittee. For managementpurposes,theGroupiscurrentlyorganisedintothreeoperatingdivisions:InvestmentManagement,UnitTrusts a Operating segments Segmental 3 information prtn xess(512 752 455 (87,289) (4,555) (7,572) (75,162) Profi Operating expenses Total assets Unallocated assets Segment totalassets Income taxcreditfromdiscontinuedoperations Income taxexpense fromcontinuingoperations Discontinued operations Allocation ofindirectexpenses Other directexpenses Staff costs–variable Staff costs–fi Net interestandotherincome Net commission Net fee income 31 December2009 oa tf ot 3,7)(,3)(,9)(45,806) (2,798) (3,938) (39,070) Total staffcosts of theCompany Profi fteCmay2,5 4 43 28,866 (433) 148 29,151 116,757 4,724 7,720 104,313 of theCompany Profi Operating income tbfr a rmcniun prtos2,5 4 6 29,468 169 148 29,151 t beforetaxfromcontinuingoperations t fortheyearattributabletoequityholders t/(loss) beforetaxattributabletoequityholders xed ,0,8 5979421,027,703 9,472 15,947 1,002,284 Management Management Investment Investment 2,0)(,7)(,9)(26,177) (15,306) (1,292) (465) (1,479) (2,155) (23,406) (12,686) 1,0)(,5)(1)(16,067) (315) (1,852) (13,900) 2,7)(,8)(,8)(29,739) (2,483) (2,086) (25,170) 979106 19,986 67 68,031 130 4,657 19,789 7,590 55,784 870––28,740 – – 28,740 nancial statementscomparedto £’000 £’000 62 (602) (602) – – Unit Trusts Unit Trusts £’000 £’000 Trust andTax Trust andTax Services Services £’000 £’000 1,037,088 tothe (continuing (continuing 19,628 (9,271) 9,385 £’000 £’000 Total Total 33

) ) are located: The followingisananalysisofthecarryingamountnon-currentassetsanalysed bythegeographicalareainwhich theassets expenditure. Centrally incurredindirectexpenses areallocatedtooperatingsegmentsonthebasisofcostdriversthatgenerate receivable fromUnitTrusts. Intersegmentsalesarecharged atprevailingmarketprices. ofcommission £1,160,000) Included withinInvestmentManagementnetcommissionincomeis£1,028,000(31December2008: a Operating segments Segmental 3 information The followingisananalysisofoperatingincomeanalysedbythegeographicallocationGroupentityprovidingservic b Geographic analysis The Groupisnotreliantonanyoneclientorgroup ofconnectedclientsforgenerationrevenues. c Major clients emn oa ses121681,1 6981,279,227 36,938 10,611 1,231,678 (13,421) (10,014) (10,014) – – 28,157 – Total assets 70,344 – 32,665 Unallocated assets 4,882 – Segment totalassets 11,149 28,157 54,313 1,290 of theCompany Profi 31,375 Income taxcreditfromdiscontinuedoperations Income taxexpense fromcontinuingoperations of theCompany Profi Discontinued operations Profi Operating expenses Total staffcosts Operating income Net interestandotherincome Net commission Net fee income restated(note1) 31 December2008 Jersey United Kingdom United Kingdom te ietepne 1,4)(,9)(3)(14,973) (435) (17,338) (26,372) (2,094) (368) (1,089) (12,444) (1,770) (3,412) (23,513) (13,558) Allocation ofindirectexpenses Other directexpenses Staff costs–variable Staff costs–fi Jersey t fortheyearattributabletoequityholders t/(loss) beforetaxattributabletoequityholders t beforetaxfromcontinuingoperations xd(456 279 272 (30,177) (2,792) (2,799) (24,586) xed

continued continued 1,4 249482131,166 4,882 12,439 113,845 Management Management 3,4)(,1)(,6)(47,515) (3,160) (6,211) (38,144) 7,0)(005 464 (88,860) (4,684) (10,075) (74,101) Investment Investment 974234(,1)32,292 (9,816) 2,364 42,306 198 39,744 2,364 39,744 £’000 £’000 113,121 116,757 Unit Trusts Unit Trusts 87,649 87,645 3,636 £’000 £’000 £’000 £’000 2009 2009 4 Trust andTax Trust andTax Services Services £’000 £’000 1,310,447 restated (note1) 131,166 126,772 (continuing (continuing 19,000 31,220 75,048 73,059 1,989 4,394 e: 129 £’000 £’000 £’000 £’000 2008 2008 Total Total ) )

Rathbone Brothers Plc 73 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 74 Notes to the consolidated accounts Dividend,nettradingandotherincome 6 Net tradingincome £134,000). (2008: Dividend incomecomprisesfromavailableforsaleequitysecuritiesof£80,000 Dividend income Netfeeandcommissionincome 5 Netinterestincome 4 Net tradingincomecomprisesthefollowing: leased byGroupcompaniesand sundryincome. iscomprised ofrentalincomefromsub-leasesoncertainproperties £1,486,000) (2008: Other operatingincomeof£1,439,000 Other income 31 December 2009 was £nil (2008: £nil). was£nil(2008: 31 December2009 £nil)andthetotalliability recognisedintheaccountsat (2008: wereoutstanding at31December2009 No FRAs rate risk.The Group’sinterestinthesecontractsdoesnotmeettherequirementsofIAS toqualifyforhedgeaccounting. 39 From tomanageitsnetexposure timetotime,theGroupusesovercounterForward tointerest Rate Agreements(FRAs) e e n omsinicm 96,384 Increase invalueofderivativefi Net feeandcommissionincome Investment Management Fee andcommissionexpense Investment Management Fee andcommissionincome Net interestincome Banks andcustomers Interest expense Loans andadvances tobanksandcustomers Held tomaturityinvestmentsecurities Interest income Unit Trust netdealingprofi Available forsale investmentsecurities Unit Trusts Trust andTax Unit Trusts ts nancial instruments nancial 103,735 18,496 21,502 21,502 16,250 (3,006) 86,577 12,587 (4,328) (3,023) (7,351) 3,669 3,669 1,583 1,583 4,571 £’000 £’000 358 358 £’000 2009 2009 2009 – restated (note1) 106,656 (37,140) 98,091 68,115 46,833 18,589 83,168 30,975 19,178 (8,565) (1,827) (6,738) 4,899 2,104 480 458 £’000 £’000 £’000 2008 2008 2008 22 7 Operating 7 expenses A moredetailedanalysisofauditors’remunerationisprovidedbelow: operations(note17).Legal andprofessional fees totalling£782,000 wererecognisedduring theyearinrelationtothis. (ii) During theyear, theGroupenteredintoanagreementtoacquirecertaindiscretionaryinvestmentmanagementassetsand 2010/11year. Further charges arelikelytobeincurredinfutureyearsandtheultimatecostremainsuncertain(note30 thenetcharge fortheyearis£229,000which in2009, includesaprovisionforthe thegovernment’scostofborrowing Aslowerinterestratesreduced and2009/10. wasmadeinrelationtoestimatedliabilitiesrespectof2008/09 £1,404,000 deposit-takinginstitutionsresultedinsignifi The toprotectdepositorsoffailed arrangementsputinplacebytheFinancialServicesCompensationScheme (‘FSCS’) (i) oa uiosrmnrto o otnigoeain 1454 91 Total auditorsremunerationforcontinuingoperations icniudoeain – – – 78 Discontinued operations Fees payabletotheCompany’sauditorsinrespectofprioryearaudit Fees payabletotheCompany’sauditorsandtheirassociatesforother Depreciation ofproperty, plantandequipment(note18) Total Other Amortisation ofintangibleassets,excluding clientlists(note17) Other operatingexpenses nulacut 85 – 87,289 annual accounts Fees payabletotheCompany’sauditorsforauditof Total operatingexpenses Amortisation ofclientrelationshipintangibleassets(note17) Operating leaserentals Auditors’ remuneration(seebelow) Staff costs(note8) Transaction costs Additional levyforFinancialServicesCompensationScheme Impairment lossesonloansandadvances(note15) Amortisation ofinternallygeneratedintangibleassetsincludedinoperating ui fteCmayssbiire usatt eilto 203 – – auditoftheCompany’ssubsidiariespursuanttolegislation services totheGroup: te evcs662 6 – otherservices expenses (note17) te evcsprun olgsain–104 – – taxservices – otherservicespursuanttolegislation (ii) cant FSCS leviesontheindustry. cant FSCS acharge totheprofi In2008 (i) Pricewaterhouse Coopers £’000 1454 91 7– 56,594 84,311 18,738 5,039 2,180 1,967 KPMG £’000 £’000 545 229 915 782 278 2009 22 t andlossaccountof £’000 545 545 545 545 104 203 2009 68 85 78 – 7 restated (note1) restated (note1) 88,860 86,146 20,233 57,859 1,404 1,310 2,122 4,173 906 602 602 248 248 525 525 127 276 £’000 £’000 2008 2008 ). 52 32 23 95 77 77 – –

Rathbone Brothers Plc 75 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 76 Notes to the consolidated accounts The averagenumber ofemployeesduringtheyearwasasfollows: Staff 8 costs directly to equity (2008: £605,000). directly toequity(2008: hasbeencredited payments andgainslossesarisingonavailableforsaleinvestment securitiesamountingto£2,338,000 In additiontotheamountcharged totheincomestatement,deferred taxrelatingtoactuarialgainsandlosses,share-based The taxeffect ofdisallowableexpenses included£219,000inrespectoftheLloydsBankingGrouptransaction(note17) 1 Incometaxexpense 9 the UK of 28.0% (2008: 28.5%).The of28.0%(2008: differences areexplainedthe UK below: The taxcharge onprofi Tax onoverseasearnings Disallowable expenses Effects of: Deferred tax(note19) Share-based payments Shared services Trust andTax Unit Trusts Under provisionfortaxinpreviousyears Tax onprofi Adjustments inrespectofpreviousyears Investment Management Current tax Wages andsalaries – defi – defi Pension costs(note25) securitycosts Social Share-based payments ned contributionschemes benefi ned t from ordinary activities at the standard rate of 28.0% (2008 –28.5%) t fromordinaryactivitiesatthestandardrateof 28.0%(2008 t schemes t t from continuing operations for the year is higher (2008: higher)thanthestandardrateofcorporationtaxin t fromcontinuingoperationsfortheyearishigher (2008: 1 56,594 5,899 5,899 8,251 3,218 9,271 9,271 47,063 2,905 2,905 5,407 5,407 1,053 1,852 1,219 £’000 £’000 446 566 681 681 438 154 154 179 179 2009 2009 2009 (22) £’000 40 30 24 2009 restated (note1) restated (note1) 11,366 11,366 48,165 48,165 13,421 13,421 12,057 57,859 1,299 1,299 2,923 1,942 2,233 5,472 (178) 388 981 981 429 623 675 273 172 £’000 £’000 £’000 2008 2008 2008 2008 80 43 31 The resultsofthe discontinuedoperations,which havebeenincludedintheConsolidatedincomestatement,wereasfollows: representing thefi Trust planstoliquidateRathbone At 31December 2009, CompanyB.V. Bank(BVI)Limitedwerewelladvanced, andRathbone InternationalFinanceB.V.to consolidatetheresultsofRathbone witheffect fromthatdate. trading agreementswiththatcompanywereterminatedandtheGroupceasedtohaveeffective controloverit.The Groupceased InternationalFinanceB.V., theGroupceasedtoberepresentedonBoardofRathbone On 12November2009, theGroup’s TrustGroup disposedofitssubsidiaryRathbone InternationalB.V.. Trustits subsidiariesRathbone Trust Company(BVI)LimitedandRathbone the (Singapore)Pte.Limitedandon17November2009 On 10February Trust theGroupdisposedofitssubsidiaryRathbone 2009 CompanyS.A.,on 31March theGroupdisposedof 2009 Trust JerseyLimited. CompanyJerseyLimitedandRathbone theGroupannounceditsintentiontoexitDuring 2008, itsinternationaltrustbusinessesanddisposedofsubsidiariesRath Disposalgroupsanddiscontinuedoperations 10 The majorclassesofassetsandliabilitiescomprisingtheoperationsclassifi The operationsofthesebusinessesareincludedwithinTrust andTax Servicesinthesegmentalanalysisnote3. retained earnings. £359,000wastransferredAs aresultofthedisposalin yearofsubsidiariesdescribedabove, fromthetranslationreserve Cash fl 5. Comparative balanceshavenotbeenrestatedtoshowassets and liabilitiesheldforsale,inaccordancewithIFRS as follows: Loss recognisedonre-measurementofassetsthedisposalgroup Net cashusedininvestingactivities Loans andadvancestocustomers Accruals, deferred incomeandotherliabilities Total assetsofthedisposalgroup Intangible assets (Loss)/profi osfo icniudoeain (569) Cash andbalancesatcentralbanks Loss fromdiscontinuedoperations Attributable taxexpense (Loss)/profi Operating expenses Operating income Property, plantandequipment Attributable taxcredit e seso h ipslgop– Net (decrease)/increaseincashandequivalents Net cash(outfl Net assetsofthedisposalgroup Total liabilitiesofthedisposalgroup Prepayments, accruedincomeandotherassets Loans andadvancestobanks ows arisingfromdiscontinuedoperations,which havebeenincludedintheConsolidatedcashfl t aftertaxfromdiscontinuedoperations t beforetaxfromdiscontinuedoperations ow)/infl nal stageintheGroup’sexit fromoverseastrustactivities. ow fromoperatingactivities ed asheldforsalewerefollows: ow statement,were (1,350) (1,526) (1,522) (358) (391) (211) £’000 959 959 2009 £’000 £’000 2009 2009 33 (4) – – – – – – – – – – restated (note1) (12,680) (16,562) 19,228 (9,885) bone bone 2,666 2,666 1,981 1,805 4,008 4,008 to 5,813 4,153 2,247 2,795 (266) 148 655 129 790 790 £’000 £’000 £’000 2008 2008 2008 46 21 –

Rathbone Brothers Plc 77 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 78 Notes to the consolidated accounts Further detailsregarding historicaldividendpaymentsareincludedintheDirectors’reportonpage28. on 5March 2010.Nofi A secondinterimdividendof26.0ppershareispayableon31March 2010toshareholdersontheregisteratcloseofbusine 18 September2009. A fi Share IncentivePlan,weightedfortherelevantperiod(seetablebelow). long-term incentiveplan,employeeshareoptionsremainingcapableofexercise andanydilutivesharestobeissuedunderthe Diluted earningspershareisthebasicshare,adjustedforeffect ofcontingentlyissuablesharesunderthe the periodof43,087,369 42,745,197). (2008: Basic earningspersharehasbeencalculatedbydividingtheweightedaveragenumberofsharesinissuethroughout Earnings usedtocalculateearningspershareonthebasesreportedinthesefi Earningspershare 12 Dividends 11 rst interim dividend of 16.0p per share was paid on 7 October 2009 toshareholders ontheregisteratcloseofbusiness rst interimdividendof16.0ppersharewaspaidon7October2009 Effect ofcontingentlyissuableordinaryshares Effect ofdilutivesharesissuableundertheShare fi of26.0p(2008: 2009 Proposed second interimdividendfortheyearended31December Weighted average numberofordinarysharesin Profi Underlying profi – fi Amounts recognisedasdistributionstoequityholdersintheyear: – fi Transaction costs Additional levyforFinancialServices Loss fromdiscontinuedoperations Profi Amortisation ofclientrelationships Effect ofordinaryshareoptions under thelong-termincentiveplan Incentive Plan issue duringtheperiod–basic (2007: 25.0p)pershare (2008: 16.0p)pershare (2008: Compensation Scheme iue riaysae 43,111,294 Diluted ordinaryshares nal dividend for the year ended 31 December 2008 of26.0p nal dividendfortheyearended31December2008 rst interim dividend for the year ended 31 December 2009 of16.0p rst interimdividendfortheyearended31December2009 t fromcontinuingoperations tatiual osaeodr 886(,3)19,628 (9,238) 28,866 t attributabletoshareholders t attributabletoshareholders nal dividendisproposed. nal dividendof26.0p)pershare 948(,7)20,197 (9,271) 29,468 22,560 (9,886) 32,446 197 551(1,416) (1,967) Pre tax (602) 33 (569 (569 33 (602) (229) 64 (165) 64 (229) 72 –(782) (782) £’000 2009 nancial statementswere: Taxation £’000 2009 Post tax £’000 2009 43,087,369 ) (10,014 236(341 28,885 (13,421) 42,306 222(322 19,000 (13,292) 32,292 30,826 45,020 (14,194) 18,066 15,948 11,164 11,257 (1,404) 400 (1,004) 400 (1,404) 130 373 (937) (1,310) 6,902 6,902 7,977 Pre tax £’000 £’000 2008 2009 2009 – – 2 (9,885) 129 ) Taxation £’000 2008 43,098,863 42,745,197 172,823 172,845 10,662 11,143 17,503 6,841 7,998 Post tax £’000 £’000 2008 2008 2008 ss

The Group’sexposure tocreditriskarisingfromloansandadvancesbanksisdescribedinnote 28. £175,227,000).(2008: (note32) were£55,039,000 Loans andadvancestobanksincludedincashequivalentsat31December 2009 discounted amountofestimatedfuturecashﬂ The fairvalueofloansandadvancesisnotmateriallydifferent totheircarryingamount.Fair valuehasbeencalculated asth Earnings persharefromdiscontinuedoperationsandunderlyingearningswereasfollows: 4 Loansandadvancestobanks 14 Cashandbalancesatcentralbanks 13 Earningspershare 12 in hand,balanceswithcentralbanksandmandatoryreservedepositsarenon-interestbearing. Mandatory reservedeposits,which areheldwithcentral banks,arenotavailableforuseintheGroup’sday-to-dayoperations. Mandatory reservedeposits – ﬁ – non-interestbearing – 3monthsorlessexcluding ondemandoratshortnotice – ondemandoratshortnotice Repayable: Cash inhand(note32) Earnings persharefromdiscontinuedoperationsforthe Underlying earningspersharefromcontinuingoperationsforthe – variableinterestrates Amounts includeloanswith: – 1yearorlessbutover3months – diluted(p) – basic(p) year attributabletoequityholdersoftheCompany: – diluted(p) – basic(p) year attributabletoequityholdersoftheCompany: xed interestrates continued ows expected tobereceivedusingcurrentmarketrates. (1.32)p (1.32)p 52.36p 52.33p 92,661 92,661 40,625 92,661 40,003 52,036 51,873 £’000 163 622 2009 £’000 315 310 2009 2009 5 restated (note1) (22.93)p (23.12)p 148,614 148,614 150,073 175,973 175,973 e 71.52p 25,900 25,900 72.12p 27,188 Cash 171 2008 £’000 348 351 2008 £’000 2008 – 3

Rathbone Brothers Plc 79 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 80 Notes to the consolidated accounts ending in2012. £nil).The (2008: loandoesnotbearinterestandisrepayableinthreeapproximately31 December2009 equalannualinstalments denominated loantotheacquirerofGroup’sGenevatrustoperationswithanominalvalueequivalent£831,000at Included withinloansandadvancestocustomersrepayablefi notes wasreassessedduringtheyearandextended bytwoyearsto2015. is recognisedovertheexpected life ofthenotesundereffective interestratemethod.The expected repaymentdateofthe England baserate.The carryingvalueofthenoteshasbeencalculatedbasedonadiscountedcashfl notes’ nominalvalueforthefollowingtwoyears.Thereafter, interestisreceivableonthenotes’fullnominalvalueatBa The notesbearnointerestforthreeyearsfromissue.InterestisthenreceivableattheBankofEnglandbaserateonhalf the occurrenceofcertainevents,principallyrefi The andunsecured,arerepayableon by theacquirerofGroup’sJerseytrustoperationsin2008. notesaresubordinated value of£3,267,000 The noteshaveanominalvalueof£5,000,000andwereissued £3,268,000). (2008: at31December2009 Included withinloansandadvancestocustomersrepayableaftermorethanfi £1,021,000). amountto£850,000(2008: services includedinloansandadvancestocustomersasat31December2009 losses onloansandadvancesrelatetodebtorsfortrustpensionservices.The totaldebtorsinrelationtotrustandpensi noneimpaired).The (2008: allowancefor No bankingloansandadvancestocustomerswereimpairedasat31December2009 Trust andPensions businessesarenon-interestbearing. discounted amountofestimatedfuturecashfl The fairvalueofloans andadvancesisnotmateriallydifferent totheircarryingamount.Fair valuehasbeencalculatedasth 5 Loansandadvancestocustomers 15 Allowance forlossesonloansandadvances The Group’sexposure tocreditriskarisingfromloansandadvances tocustomersisdescribedinnote28. – non-interestbearing – over5years Transferred ondisposalofbusiness Transferred tonon-currentassets heldforsale – discontinuedoperations – continuingoperations Charge totheincomestatement Amounts writtenoff Exchange rateadjustment At 1January Less: allowancefor lossesonloansandadvances – 1yearorlessbutover3months – ondemandoratshortnotice Repayable: – fi – variableinterestrates Amounts includeloanswith: – 5yearsorlessbutover1year – 3monthsorlessexcluding ondemandoratshortnotice xed interestrates ows expected tobereceivedusingcurrentmarketrates.Debtorsarisingfromthe nancing oftheoperationsdisposedof. ve yearsbutaftermorethanoneyearisaSwiss Franc ve yearsarevendorloannotes(‘notes’)witha fair ow modelandinterestincome 12,015 21,387 26,745 26,745 5,358 5,358 3,268 4,043 6,670 (112) £’000 £’000 831 175 2009 2009 (82) 82 22 (3) – – – – restated (note1) nk of e on the 39,412 25,695 39,412 14,823 11,243 5,883 5,883 5,887 7,830 7,155 (427) (350) (607) (175) 483 483 130 130 639 175 738 £’000 £’000 2008 2008 52

Held tomaturitysecurities Available forsalesecurities Investment 16 securities Debt securitiescomprisebankandbuildingsocietycertifi Maturity ofdebtsecurities The movementininvestmentsecuritiesmaybesummarisedasfollows: sharesin LondonThe Stock Groupcontinuestohold300,000 Exchange GroupPlc. ‘at fairvaluethroughprofi profi The Grouphasnotreclassifi demand, havebeenincludedwithincashequivalents(note32). Money marketfunds,which declaredailydividendsthatareinthenatureofinterestatavariablerateandwhich arerealisabl Available forsalesecuritiesincludemoneymarketfundsanddirectholdingsinequitysecurities.Equitydonotbea assets isbasedonmarketbidprices. Fair valueforheldtomaturity £894,968,000). (2008: was£699,881,000 The fairvalueofdebtsecuritiesat31December2009 included Giltsandtreasurybills. t3 eebr20 6926400780,932 694,000 86,932 At 31December 2009 Loss fromchanges infairvalue – listed Debt securities–atamortisedcost – listed Equity securities–atfairvalue Disposals (salesandredemption) Additions Due aftermorethan1year t1Jnay20 191 7,7 956,970 874,979 81,991 At 1January2009 Due within1year osfo hne nfi au 397 (3,957) 772,222 2,914,080 – 765,274 (2,725,375) 2,545,080 369,000 (2,435,375) 6,948 (3,957) (290,000) Loss fromchanges infairvalue Disposal (salesandredemption) Additions At 1January2008 – unlisted – unlisted Money marketfunds–atfairvalue – unlisted t and loss during the year (2008: nonereclassifi t andlossduringtheyear(2008: t orloss’. ed anyfi nancial assetfrombeingmeasuredatamortised costtobeingmeasuredatfairvaluethrough ed). The Grouphasnotdesignatedatinitialrecognitionanyfi cates ofdeposit,which havefi Available for sale 6100 19721 (2,578,261) (1,977,261) (601,000) 606,000 1,796,282 2,402,282 2,402,282 1,796,282 606,000 £’000 5)–(59) (59) xed coupons. In 2008, debtsecuritiesalso xed coupons.In2008, Held tomaturity 694,000 694,000 694,000 694,000 654,000 654,000 40,000 40,000 86,932 84,000 2,153 £’000 £’000 £’000 779 779 £’000 2009 2009 2009 – nancial asset as asset nancial 849,979 873,978 874,979 874,979 r interest. e on 81,991 25,000 79,000 1,462 1,462 1,001 1,529 £’000 £’000 £’000 £’000 2008 2008 2008 Total

Rathbone Brothers Plc 81 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 82 Notes to the consolidated accounts weighted averagecostofcapitalandrefl cash fl cases)basedonmanagement’sexpectation offutureindustrygrowthrates.Theboth pre-taxrateusedtodiscounttheforecast and2%fortheTrustmedium- tolong-termgrowthrateof3%fortheInvestmentManagement CGU andTax 2% in (2008: CGU recent fi The growthratesarebasedonindustryforecasts.The Grouppreparescashfl CGUs. discount ratesusingpre-taxthatrefl for thevalueinusecalculationsarethoseregardingdiscountratesandgrowthduringperiod.Managementestimat aredeterminedfromvalueinusecalculations.The keyassumptions The recoverableamountsofgoodwillallocatedtotheCGUs benefi thatareexpected Goodwill acquiredinabusinesscombinationisallocated,atacquisition,tothecashgeneratingunits(CGUs) determination ofthefi follo Additions togoodwillrepresentanadjustmenttheacquiredwithCitywallFinancialManagementLimitedin2008 Intangible 17 assets Goodwill Transferred toassetsheldforsale Transferred toassetsheldforsale Additions Exchange adjustment Impairment charge recognisedintheyear e arigaon fgowl t3 eebr47,241 Trust andTax Net carryingamountofgoodwillat31December At 31December Goodwill At 1January Accumulated impairmentlosses At 31December At 1January Cost Investment Management Other intangibleassets Disposals t fromthatbusinesscombination.The carryingamountofgoodwill hadbeenallocatedasfollows: ows is10%forInvestmentManagementand12%Trust and Tax cases)basedonariskadjusted 11.5%inboth (2008: nancial budgetsapprovedbymanagement,covering theforthcomingyear, extrapolated forupto10yearsbasedona nal considerationpayment. ecting therelativelysmallsizeofTrust andTax CGU. ect currentmarketassessmentsofthetimevalue ofmoneyandtherisksspecifi ow forecastsderivedfromthemost 81,973 34,732 45,287 47,023 47,241 47,241 47,241 1,954 1,954 £’000 £’000 £’000 218 2009 2009 2009 – – – – – – – c tothe (23,550) 45,069 45,069 68,232 68,232 21,209 70,536 47,023 47,023 47,023 47,023 1,954 to (887) (887) 887 247 677 £’000 £’000 £’000 2008 2008 2008 es wing – – Other intangibleassets Intangible 17 assets Purchased software withacostof£7,732,000 £6,756,000) (2008: hasbeen fullyamortisedbutisstill in use. £185,000 havebeenrecognised asaresultofthetransaction.Nootherassetswereacquired. ofconsiderationispayableon25September2010.Intangible assetsforclientrelationshipswithafairvaluetotallin £60,000 theGroupacquired tradeofTrustOn 25September2009 FinancialLimitedfor£125,000incashconsideration. Afurther Group transaction.Nogoodwill arose inrelationtothetransaction. Transaction costsof£782,000 havebeenrecognisedintheConsolidated incomestatementinconnectionwiththeLloydsBanking consideration ultimatelypayableisbelowthisvalue. willbemadeon26February Anadvancepaymentofupto£8,382,000 was £8,382,000. 2010,which isrecoverableifthetotal payable underthefl from thecalculationofmaximumpurchase consideration.At thetheoreticalmaximumconsideration 31December2009, consideration payable.Funds undermanagementforthoseclientswho electtoremainwithLloydsBankingGroupareexcluded consideration, inrecognitionofassistancefromLloydsBanking Groupwiththetransfer ofclientsandacap onthemaximum at thattime.The agreementincludesafl noassetshadbeenrecognisedinrelationtonewrelationshipswithsuch2009 clientsasno had transferred totheGrou Plans tomigratediscretionaryprivateclientportfoliosfromLloyds TSB during2010areatanadvancedstage.As31Decembe to transfer totheGroupatthosedates. June2010and31December 2010inproportiontothetotalvalueoffundsundermanagementforclientswhohaveagreed 30 values determined.ConsiderationpaymentsforPortfolio ManagementServiceclientswillbemadeininstalmentsshortlyafter those formerBankofScotlandPortfolio ManagementServiceclientsfromwhomconsenthadbeenreceivedandportfoliotransfer hadbeenrecognisedinrelationtonewrelationshipswith acquiredclientrelationshipsof£11,683,000 As at31December2009, discretionaryinvestment managementactivities. discretionary investmentmanagementassetsandHBOS’s theGroupagreedtermswithLloydsBankingfortransferOn 20October2009, ofelementsLloydsTSB’s legacy arigaon t1Jnay20 2855417915,198 1,759 12,399 554 21,209 2,492 8,461 2,121 906 1,147 12,885 711 2,791 276 18,377 9,968 1,310 7,601 871 (41) 1,496 – 33,608 – (8) 10,582 1,858 7,585 (41) – 21,168 433 1,268 565 Carrying amountat1January2008 – – – Carrying amountat31December2008 – 25,166 9,360 6,317 433 (46) (8) 1,425 – (46) – 14,381 Charge fortheyear At 1January2009 565 – Transferred tonon-currentassetsheldforsale(note10) Disposals – discontinued – – continuing Charge fortheyear At 1January2008 Purchased intheyear Internally developedintheyear At 1January2009 Disposals Transferred tonon-currentassetsheldforsale(note10) Acquired throughbusinesscombinations Purchased intheyear Internally developedintheyear Exchange adjustment At 1January2008 Cost t3 eebr20 6282261,5 50,291 11,757 2,236 36,298 Amortisation At 31December2009 t3 eebr20 ,5 ,2 ,7 15,559 9,376 1,425 34,732 4,758 2,381 811 31,540 Carrying amountat31December2009 At 31December2009 oor, ifmorethan50%ofclientselectnottoremainwithLloydsBankingGroupnortransfer toRathbones, continued oor ontheminimumtotalconsiderationpayable,which is50%ofthemaximumpurchase Acquired client relationships 15,130 – 15,130 1,175 16,305 1,967 2781,967 915 3,160 £’000 8)– (87) (87) 6––26 26 – 4)(46) –(46) – – 378 – 378 378 – 378 – development Software £’000 costs Purchased software £’000 g p £’000 Total r

Rathbone Brothers Plc 83 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 84 Notes to the consolidated accounts 8 Property, plantandequipment 18 t3 eebr20 ,4 38420,904 13,864 7,040 Depreciation At 31December2009 t3 eebr20 ,8 15615,228 5,676 11,546 2,318 3,682 3,358 Carrying amountat31December2009 At 31December2009 arigaon t1Jnay20 ,7 ,5 8,131 (2,039) 6,816 13,456 503 3,457 2,122 (1,632) 3,100 10,535 475 431 4,674 106 1,425 (407) 13,927 3,716 2,921 72 419 697 106 (4,424) 11,226 (1,638) 20,272 56 2,701 (2,442) – 528 (1,440) 13,635 Carrying amountat1January2008 Carrying amountat31December2008 22,058 116 (1,982) (198) 6,637 454 3,780 1,4152,365 Disposals 14,683 Charge fortheyear 116 At 1January2009 (1,786) Disposals 74 Transferred 7,375 tonon-currentassetsheldforsale(note10) Acquired throughbusinesscombinations – discontinued – (1,541) – continuing Charge fortheyear Exchange adjustments At 1January2008 (245) Disposals Additions At 1January2009 Disposals Transferred tonon-currentassetsheldforsale(note10) Acquired throughbusinesscombinations Additions Exchange adjustments At 1January2008 Cost improvements Short term leasehold £’000 403 682 682 403 1,085 761 1,419 2,180 43 (453) – (453) 48 (408) – (408) equipment Plant and £’000 £’000 Total The deferred taxcharge intheincomestatementcomprisesfollowingtemporarydifferences: The movementon thedeferred taxaccountisasfollows: 28%). (2008: Deferred incometaxesarecalculated onalltemporarydifferences undertheliabilitymethodusinganeffective taxrateof28% Deferredtaxasset 19 Deferred taxliabilities Deferred taxasset 31 December 2009 (2008: £3,804,000). (2008: 31 December2009 at certain subsidiariesassuch Unremittedearningstotalled£3,601,000 amountsarenotexpected toberemittedtheUK. havenotbeenrecognisedin respectofunremittedearnings £684,000) Deferred (2008: incometaxliabilitiesof£648,000 – fairvaluemeasurementofavailableforsalesecurities – share-basedpayments – actuarialgainsandlosses – amountscharged totheincomestatement Other movementsindeferred tax: Other provisions At 1January Excess ofdepreciation Pensions Excess ofdepreciation Available forsalesecurities Share-based payments – credited/(charged) directlytoequity Discontinued operations Intangible assets Unremitted overseasearnings Staff relatedcosts Share-based payments Staff relatedcosts Intangible assets Deferred income Pensions Staff relatedcosts Disposals – charged totheincomestatement Adjustments inrespectofprioryears: Unremitted overseasearnings (2,984) 1,603 2,483 4,558 3,434 2,415 3,218 3,218 2,955 1,728 1,778 1,778 (234) (135) £’000 £’000 £’000 £’000 298 298 638 208 208 382 583 266 269 188 807 151 2009 2009 2009 2009 (70) 41 71 17 – – – (1,656) 2,509 1,346 4,992 1,602 2,483 1,108 2,233 1,627 3,528 1,743 (490) (489)

(419) 396 339 339 661 339 217 824 658 754 709 £’000 £’000 £’000 £’000 678 2008 2008 2008 2008 (96) (87) 93 12 73 73 –

Rathbone Brothers Plc 85 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 86 Notes to the consolidated accounts 0 Prepayments, accruedincomeandotherassets 20 2 Duetocustomers 22 discounted amountofestimatedfuturecashfl The fairvalueofdeposits bybankswasnotmateriallydifferent tothecarryingvalue.Fair valuehasbeencalculatedasthe nil). depositsbybanksincludedovernightoverdraftbalancesof£1,224,000(2008: 31 December2009, theLondoninstalments endingon4April2011.Interestispayabletheloanat0.7%above Inter-BankOffer Rate.On £9,201,000)ofanunsecuredtermloanwhichThe isrepayableinfour, Grouphasdrawn down£6,155,000(2008: six-monthly Depositsbybanks 21 3 Accruals, deferredincome,provisionsandotherliabilities 23 value oftheBShareswillbeupdated ateach reportingdatewith changes invaluebeingtakentoprofi £65,000).The £55,000was includedinCreditorsrepresentingtheestimatedpresentvalue ofthefutureliability(2008: f 2009, UnitTrustto thegrowthinvalueofRathbone ManagementLimited,comparedtoitsvalueat31December2007. At 31December Shares entitletheholdertorequireanothersubsidiaryofGroup topurchase the‘B’Sharesatavaluedeterminedwithrefe UnitTrust Rathbone On 5November2008, ManagementLimited,asubsidiaryoftheGroup,issued22,225‘B’Shares.The ‘B’ fi with nostatedmaturity, which includesnon-interestbearingdeposits,istheamountrepayableondemand.The estimated fairva The fairvalueofamountsduetocustomerswasnotmateriallydifferent totheircarryingvalue.The estimatedfairvalueofde xed-interest bearingdepositsisbasedondiscounted cashfl – fi Prepayments Other provisions(note24) Accruals anddeferred income – variableinterestrates Amounts include: – 5yearsorlessbutover1year Trust workinprogress – ondemandoratshortnotice Repayable: Creditors – 3monthsorlessexcluding ondemandoratshortnotice Accrued income – non-interestbearing – 1yearorlessbutover3months xed interestrates ows expected tobepaidusingcurrentmarketrates. ows usinginterestratesfornewdebtswithsimilar remainingmaturity. 766,361 766,361 705,071 702,705 t orloss. 59,060 59,736 23,235 23,525 46,875 29,878 17,749 17,749 4,596 4,596 5,601 5,601 1,554 6,023 £’000 £’000 £’000 620 2009 2009 2009 – 1,044,351 1,044,351 639,197 394,678 349,751 677,056 posits 38,646 42,450 25,191 13,656 32,507 10,476 3,888 3,888 8,964 8,964 8,295 rence 5,475 lue of 664 664 air £’000 £’000 £’000 2008 2008 2008 third parties.Non-currentprovisionsareexpected tobesettledwithin24monthsof the balancesheetdate. The timingofsettlementprovisionsforclientcompensationorlitigationisdependent,inpart,onthedurationnegotiat made inrelationtoanumberofcaseswherelegalproceedingsareexpected toresultinlosstheGroup. assessed onacasebybasisandprovisionsforcompensationaremadewherejudgednecessary. Provisions havealsobeen In theordinarycourseofbusiness,Groupcanreceivecomplaintsfromclientsinrelationtoservicesprovided.Complai £450,000)wereincludedwithinotherassets. (2008: anticipatedinsurancerecoverables relatingtoclientcompensationandlitigationrelatedprovisionsof£n At 31December2009, investment managementactivitiesfromLloydsBankingGroup(note17). inrelationtotheagreement acquirecertaindiscretionar relationships, which havebeencapitalisedandinclude£11,486,000 Other movementsinprovisionsrelatetodeferred paymentstoinvestmentmanagersandthirdpartiesfortheintroductionofclie Other 24 provisions The Groupoperatestwofundedpensionschemes providingbenefi £518,000)ofwhich £489,000). were £52,000(2008: £32,000relatestodiscontinuedoperations(2008: £952,000).The(2008: Groupalsooperatesdefi arrangements forcertaindirectorsandemployees.The totalofcontributionsmadetothisscheme duringtheyearwas£1,033,000 The Groupoperatesadefi Long-termemployeebenefi 25 employee benefi £864,000).Theestimatedpresentvalueofthe uninsured deathinservicebenefi the year(2008: purchased forthebenefi The Groupprovidesdeathinservicebenefi Average RevaluedEarnings. basis withtheexisting assetsremaining investedthereunder. With effect allfutureaccrualisbasedonCaree from1July2009 1987The Scheme Rathbone wasclosedtonewentrantswitheffect from31March 2002.Bothschemes continueonaclosed Laurence Keen Scheme 1987 wereincludedundertheRathbone Scheme foraccrualofretirement benefi Asfromthatdatealltheactive membersofthe pension accrualforthecurrentmembershipwitheffect from1October1999. The Stockbrokers scheme Limited(theLaurenceKeen operatedbyRathbone Scheme) wasclosedtonewentrantsandfuture nominated bymembersofthefund. is determinedbytheschemes’ trustdocumentationandlegislation. The Grouphasapolicythatone-thirdofalltrusteesshould The trusteesofthefundarerequiredtoactinbestinterestfund’sbenefi of theGroup. accordance withthestatementsofinvestmentprinciplesagreedbytrustees.Scheme assetsareheldseparatelyfromthose InvestmentManagementLimited,withinvestments managedonadiscretionarybasis,in clientsofRathbone currently both 1987 (theRathbone Scheme andtheLaurenceKeenstaff employedbytheCompanyinUK Scheme). The schemes are tlsdpi uigtepro 577 64 3)(6,460) (39) 578 8,964 685 30 (644) 140 140 (5,777) – 14,667 438 1,007 545 14,667 7,927 – – Non-current Current Utilised/paid duringtheperiod Other Net charge totheincomestatement Unused amountcreditedtoprofi movements Charged totheincomestatement At 1January2009 ts liabilities. ts ts wherepossible and£547,000 ofrelatedinsurancepremiawereexpensed totheincomestatement in ned contributiongrouppersonalpensionscheme andcontributes tovariousotherpersonalpension to os–(0)– (107) – (107) – t orloss ts ts to all employees through the Rathbone 1987 Scheme.ts toallemployees throughtheRathbone Third partyinsuranceis ned contributionschemes foroverseasemployees,which thetotalcontributions ts basedonfi nal pensionablepayforexecutive directorsand ciaries. The appointmentoftrusteestothefund Other payables 16,588 801 131 801 16,588 17,520 687811117,749 17,749 131 131 16,817 801 801 16,817 229 – 229 £’000 ts isincludedin long-term compensation Client £’000 ts forfurtherservice. and other Litigation related £’000 ions with nts are be r y nt £’000 il Total

Rathbone Brothers Plc 87 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 88 Notes to the consolidated accounts refl the timescalecoveredbyliability, outinpractice.The maynotnecessarilybeborne principalactuarialassumptionsused, The assumptions usedbytheactuariesarebestestimateschosen fromarangeofpossibleactuarialassumptionswhich, duet sheet dateinbetweenfullvaluations.The latestfullactuarialvaluationswerecarriedoutasatthefollowingdates: discounted toapresentvalueusingratethatrefl value ofbenefi The schemes arevaluedbyindependentactuarieseverythreeyearsusingtheprojectedunitcreditmethodwhich looksatthe The amountincludedinthebalancesheetarisingfromGroup’sobligationsrespectofschemes isasfollows: 5 Long-termemployeebenefi 25 males anda0.5%underpinforfemales. The assumedlife expectations onretirementwere: recent andexpected futureimprovementsinlife expectancy byusingthe‘MediumCohort’projection,witha0.75% underpinfor theassumptionforlife expectancy actuarialtables. In2008, schemes wasupdatedtotakeaccountof isbasedonthePNA00 to65duringtheyear.normal ageofretirementincreasedfrom60 The assumedlife expectancy for themembershipofboth Normal retirementageis65formembersoftheLaurenceKeen Scheme 1987 andformembersoftheRathbone Scheme the the returnsexpected oneach classof assetheldbythescheme, asdisclosedbelow. 1987 25years).The Schemethe Rathbone overallexpected is24years(2008: returnonscheme assetsisaweightedaverageof The assumeddurationoftheliabilitiesforLaurenceKeen 25years)andtheassumeddurationfor Scheme is18years(2008: The amountsrecognisedintheincomestatement,withinoperatingexpenses, areasfollows: ect thedifferent membershipprofi Interest cost Death inservicebenefi Infl Expected returnonscheme assets Discount rate Rate ofincreasedeferred pensions Rate ofincreasepensionsinpayment Laurence Keen Scheme 1987 SchemeRathbone Total defi Present valueofdefi –aged60 Retiring today Rate ofincreaseinsalaries Current servicecost eiigi 0yas–aged60 Retiring in20years Expected returnonscheme assets Defi Fair valueofscheme assets ation cit inschemes ct(8)(,2)(9,413) (8,626) (787) cit ts accruingovertheyearsfollowingvaluationdatebasedonprojectedsalarytoofterminationservices, ned benefi ned t reserve-unfunded – aged65 – aged65 t obligations t les oftheschemes, were: ts continued ects thecharacteristics oftheliability. The valuationsareupdatedateach balance Laurence Scheme 3.60 3.60 6.00 4.85 5.70 3.70 Keen 2009 % 1,8)(441 (85,577) (74,491) (11,086) 0296,5 77,254 66,955 10,299 Laurence Laurence Scheme Scheme 43 347 (3,940) (3,477) (463) 77 756 (8,323) (7,536) (787) £’000 £’000 9 ,6 4,052 3,462 590 2 ,2 1,852 1,725 127 Keen Keen 2009 2009 ,4 1,740 – 1,740 (1,090) – (1,090) Rathbone Rathbone Laurence Scheme Scheme Scheme 2.80 5.30 2.80 3.40 6.15 4.05 £’000 £’000 2009 2009 2008 1987 1987 Keen % Males 3625.4 30.3 24.2 23.6 29.1 28.5 22.0 26.8 £’000 £’000 Total Total 2009 2009 2009 Rathbone 970 5,4)(63,993) (54,243) (9,750) Laurence Laurence Females 8,760 50,551 59,311 Scheme Scheme Scheme 90 473 (5,723) (4,733) (990) (4,682) (3,692) (990) 65 403 (4,628) (4,013) (615) 3.60 3.60 3.50 4.85 5.70 £’000 £’000 7.00 579 3,435 4,014 2008 2008 3)1981,942 1,978 (36) Keen Keen 2009 2009 1987 – 2,556 2,556 (1,041) – (1,041) % 31 December2008 31 December2007 Rathbone Rathbone Scheme Scheme 3525.3 30.3 24.1 23.5 29.0 28.4 21.9 26.7 £’000 £’000 Males 2008 2008 2008 1987 1987 which Rathbone Females Scheme 2.80 6.40 2.80 2.80 6.15 4.05 £’000 £’000 2008 2008 2008 2008 1987 Total Total o % Movements inthepresentvalueofdefi as follows: is The cumulativeactuarial gainsandlossesreportedinthestatementofcomprehensiveincomesinceadoptionIFRS £7,750,000(2008: 1987 Scheme. fall)fortheRathbone £1,100,000fall)fortheLaurenceKeen (2008: Schemewas ariseinvalueof£1,403,000 andariseinvalueof£9,791,000 Actuarial gainsandlosseshavebeenreportedinthestatementofcomprehensiveincome.The actualreturnonscheme assets Long-termemployeebenefi 25 Movements inthefairvalueofscheme assets wereasfollows: Contributions frommembers At 1January t3 eebr(0)(,4)(7,954) (7,549) (405) At 31December t3 eebr1,8 55186,667 75,581 11,086 Benefi Contributions fromscheme members Actuarial gains/(losses) At 31December Benefi Actuarial loss/(gain) Interest cost Service cost(employer’spart) At 1January Actuarial (losses)/gainsrecognisedinyear At 1January t3 eebr1,9 69577,254 66,955 10,299 At 31December Contributions fromthesponsoringcompanies Expected returnonscheme assets ts paid ts paid ts ned benefi ned ts continued t obligationswereasfollows: Laurence Laurence Laurence Scheme Scheme Scheme 1,050 14,830 15,880 15,880 14,830 1,050 9,750 55,284 65,034 65,034 9,750 55,284 8,760 50,551 59,311 8,760 59,311 50,551 34 90 (1,284) (980) (304) (1,284) (980) (304) 10 856 (8,626) (8,516) 672 967 (110) (295) £’000 £’000 £’000 590 3,462 4,052 3,462 590 440 6,348 6,788 6,348 440 7,254 6,314 940 463 3,477463 3,940 Keen Keen Keen 2009 2009 2009 – 1,245 1,740 1,740 – – 1,245 Rathbone Rathbone Rathbone Scheme Scheme Scheme £’000 £’000 £’000 2009 2009 2009 1987 1987 1987 £’000 £’000 £’000 Total Total Total 2009 2009 2009 10,301 60,27410,301 70,575 175 1,7)(12,392) (10,677) (1,715) Laurence Laurence Laurence ,6 05159,311 50,551 8,760 9,708 54,415 64,123 65,034 55,284 9,750 Scheme Scheme Scheme 88 844(44) (888) 33 77 (1,030) (727) (303) (1,030) (727) (303) 87 1,2)(12,348) (11,521) (827) 672 967 (295) 593 123 716593 123 455 2,260 2,715 455 2,260 615 4,013 4,628 £’000 £’000 £’000 579 3,435 4,014 2008 2008 2008 Keen Keen Keen – 1,267 1,267 – 2,556 2,556 – 1,267 1,267 Rathbone Rathbone Rathbone Scheme Scheme Scheme £’000 £’000 £’000 2008 2008 2008 1987 1987 1987 £’000 £’000 £’000 2008 2008 2008 Total Total Total

Rathbone Brothers Plc 89 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 90 Notes to the consolidated accounts was asfollows: The analysisofthe scheme assets,measuredatbidprices,andexpected ratesofreturnonthoseassetsatthebalancesheetda Laurence Keen Scheme Long-termemployeebeneﬁ 25 Rathbone 1987 Scheme The sensitivitiesregardingtheprincipalassumptionsusedtomeasuretotal of thetwoschemes’ liabilitiesaresetoutbel invested incompaniesoutsidetheFTSE 350andnotmorethan15%oftheassetsmaybeheldinalternativeassets. In theLaurenceKeen equitiesmaybe Scheme, notmorethan55%oftheassetsmaybeheldinequities. Amaximumof15%UK invested incompaniesoutsidetheFTSE 350andnotmorethan5%oftotalequityassetscanbeinvestedinhedgefunds. equitiesmaybe 1987 oftheassetsmaybeheldinequities.Amaximum5%UK In theRathbone Scheme, notmorethan80% classesinthestatement ofinvestmentprinciples. portfolio inthefollowingsectorsandproportions: The statementofinvestmentprinciplessetbythetrusteesrequiresthatassetsscheme areinvestedinabalanced government bonds. Cashhasbeenassumedtogenerateasimilarreturnshortdat of defaultandfuturedowngradeinrelationtocorporatebonds. expected rateofreturnondebtinstrumentsisbasedlong-termyieldsatthestartyear, withanadjustmentforther The 3.25%above). The thereturnonlongdatedGilts(2008: expected returnonequitieswasassumedtobe3.25%above intended tobroadlyalignwiththedurationofscheme’s liabilities. £5,000,000)inaninterestrateswapfund.The(2008: fundisinvestedinlongdatedinterestrateswaps,thedurationofwhich withanominalvalueof£3,812,000 1987 496) Scheme theRathbone At held335shares(2008: 31December2009

Debt instruments Cash Interest rateswapfunds Cash Debt instruments Cash deposits Equity instruments Equity instruments t3 eebr10,299 At 31December ie neetsok 45%–65% – rateofinfl – discountrate 0.5% increaseto: The totalallocationofassetsintheLaurenceKeen Scheme tofi * Fixed intereststocks Overseas equities equities UK erices olneiya 0240 2.8 2,440 1 yearincreasetolongevityat60 – rateofsalarygrowth t3 eebr66,955 At 31December ation ts continued xed intereststocks andcashdepositsisexpressed asacombinedpercentageofthetwoasset Expected Expected 4.50 4.50 4.90 0.50 4.90 0.50 0.50 return return 1.1.09 1.1.09 7.75 7.75 % % Expected Expected 2.00 4.10 6.15 2.00 4.10 1.1.08 1.1.08 7.35 7.35 return return % % 52,219 arneKe ceeRathbone1987 Scheme Laurence Keen Scheme 8,843 8,843 4,204 1,356 1,356 5,252 4,537 Combined impactonschemes’ liabilities £’000 £’000 value value 843 843 (Decrease)/increase 2009 2009 Fair Fair 45% –65% 5 5 43%–57% 35% –55% %–2%21%–35% 0% –20% 33,232 50,551 919 (10.5) (9,119) 4,086 4.7 4,086 3,283 3.8 4,694 4,694 3,494 9,135 5,431 2,753 8,760 £’000 £’000 £’000 572 572 2008 2008 value value Fair Fair * * allocation allocation Current Current (Decrease)/increase 2009 2009 13 41 51 78 78 % % 2 7 8 14% –28% 0% –8% ow: isk allocation allocation is Current Current 2008 2008 ed te 40 16 11 54 67 67 % % 6 6 % pension costwillincreaseasthemembersofscheme approach retirement. also bemadefrom2010until2017. Asthescheme thecurrent wasclosedtonewentrantswitheffect from 1October1999, to bemadetheLaurenceKeen Scheme. Following will triennialvaluationfurtherannualcontributionsof£336,000 the2008 £nil).Annualcontributionsof£420,000willcontinue (2008: Additional lumpsumcontributionsof£20,000werepaidin2009 The totalcontributionsmadebytheGrouptoLaurenceKeen £455,000). Scheme duringtheyearwere£420,000(2008: cost willincreaseasthemembersofscheme approach retirement. until 2016.After 31March 1987 2002theRathbone Scheme wasclosedtonewentrantsand,consequently, thecurrentpension £nil)andtheGrouphascommitted tomakeadditionalannualcontributionsthescheme (2008: of£2,750,000were paidin2009 13.9%).Additionallumpsumcontributionsof£2,750,000 basedon22.6%ofpensionablesalaries(2008: £2,260,000) (2008: 1987The Scheme totalregularcontributionsmadebytheGrouptoRathbone during theyearwere£3,598,000 Laurence Keen Scheme The historyofexperience adjustmentsisasfollows: Long-termemployeebenefi 25 The followingmovementsinissuedsharecapitaloccurredduringtheperiod: £0.05 pershare.Allissuedsharesarefullypaid. 100,000,000)withaparvalueof was100,000,000(2008: The totalauthorisednumberofordinarysharesat31December2009 Share 26 capital Rathbone 1987 Scheme – amount(£’000) Experience adjustmentsonscheme liabilities: – percentageofscheme assets(%) Defi Fair valueofscheme assets(£’000) – percentageofscheme assets(%) Present valueofdefi Present valueof defi t3 eebr20 32630 ,6 17633,921 31,756 2,165 31,100 1,502 28,957 1,319 1,488 2,143 1,311 29,892 14 8 27,758 2,134 415.0–852.0 795.0 –796.0 43,296,330 272,334 165,800 42,858,196 42,689,942 At 31December2009 – onexercise ofoptions – toshareincentiveplan Shares issued: At 1January2009 Shares issuedonexercise At 1January2008 – amount(£’000) Experience adjustmentsonscheme assets: – amount(£’000) Experience adjustmentsonscheme assets: – percentageofscheme liabilities(%) Defi Fair valueofscheme assets(£’000) – percentageofscheme liabilities(%) – amount(£’000) Experience adjustmentsonscheme liabilities: fotos1824450–82091191,208 1,199 9 415.0–852.0 168,254 of options cit inthescheme (£’000) cit inthescheme (£’000) ned benefi ned benefi ned t obligations(£’000) t obligations(£’000) ts continued Number of shares (11,086) (75,581) 66,955 66,955 10,299 (8,626) 6,314 (787) 940 305 305 395 2009 2009 9% 4% 9% 0% 5,8)(024 5,8)(50,501) (53,982) (60,274) (55,284) 50,551 54,415 44,646 35,37050,551 54,415 44,646 10,677 90 753 4,297 970 1,0)(043 (11,697) (10,423) (10,301) (9,750) 473 589 936 (15,131) (9,336) (5,859) (4,733) Exercise 2,937 1,264 3,038 7,1382,937 1,264 3,038 1,715 70 85 539 8,760 9,708 8,996 8,118 90 53 147 (3,579) (1,427) (593) (990) 0 %1 7% 1% 1% 20% 1 %2 12% 2% 0% 21% Pence 248 104 248 1,592 1,864 0820 062005 2006 2007 2008 2005 2006 2007 2008 price %1 5 16% 15% 1% 3% %2 %14% 6% 2% 5% capital Share £’000 premium Share £’000 £’000 Total

Rathbone Brothers Plc 91 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 92 Notes to the consolidated accounts Movements inthenumberofshareoptionsoutstandingwereasfollows: options incash. years fromthedatetheybecomeexercisable. The Grouphasnolegalorconstructiveobligationtorepurchase orsettlethe service (thevestingperiod)andareexercisable threeyearsfrom grant date.The optionshaveacontractualoptiontermofsev and2000.Optionsareconditional ontheemployeecompletingthreeyears’ 1996 (asamendedin1996), shareholders in1993 to subscribeforsharesintheCompanyatpricesrangingfrom415p1172p undertheshareoptionschemes approvedby The Companyhasashareoptionscheme forallemployeesoftheGroup.Underscheme, certainemployeesholdoptions Share optionscheme information onthescheme isgivenintheRemunerationreportonpage40. At theendofsavingsperiod,employeescanelecttoacquiresharesorreceivetheirsavings,includinginterest,incash. Under thescheme, employeescancontributeupto£250permonthacquiresharesattheendofthreeyearsavingsperiod. During theyear, Revenue&Customsapprovedsavingsrelatedshareoptionplan(saveasyouearn). theGroupestablishedanHM Savings relatedshareoptionplan Dividendsontheseshareshavebeenwaivedbythetrustees. £393,354). with atotalmarketvalueof£341,544(2008: thetrusteesofLTIPAt 31December2009, 47,193) (2008: held42,693 BrothersPlc ordinarysharesof5peach inRathbone £119,000 hasbeenrecognisedfortheestimatedfairvalueoffutureawards. under theLTIP totreatthemascashsettledratherthanequitywitheffect At from31March theyearend,aliab 2009. following changes tocapitalgainstaxrules.Asaconsequenceofthis, theGroupchanged thebasisofaccountingforaward awardincashasanalternativetos thetrusteesofplanelectedtosettlesubstantiallyall2006/08 In March 2009, Details ofthegeneraltermslong-termincentiveplan(LTIP) to43. aresetoutintheRemunerationreportonpages36 Long-term incentiveplan 412,701) (2008: Of thetotalnumberofsharesheldbytrustees341,138 havebeenconditionallygiftedtoemployees. £10,755,417). (2008: Brothers Plcwithatotalmarketvalueof£10,851,336 Nodividendsontheseshareshavebeenwaived. ordinarysharesof5peach inRathbone 1,290,392) held1,356,417(2008: thetrusteesofSIP As at31December2009, paid incash. dividendsarereinvestedandusedtopurchase shareswhilstforoverseasemployees,dividendsare employees,SIP For UK uptoamaximumof£3,000perannum. £100 per1%realincreaseinEPS The Groupalsoprovides performance-relatedfreeshares,witheligibleemployeesreceivingsharesvaluedattherateof currently matches employeecontributionsonaone-for-onebasistoacquirematching shares. £125 permonthtoacquireshareswhich areacquiredtwiceayearattheendofsixmonthaccumulationperiods.The Group which isavailabletoallemployees.Employeescancontributeup The Groupoperates aShareIncentivePlan(SIP), Share IncentivePlan Share-based 27 payments The inputsintothebinomialmodelforoptionsgranted duringtheyear, asatthedateofissue,were asfollows: determinedusingabinomialvaluationmodelincluding expectedfair valueof£49,000, dividends,weregrantedon22August2008 todirectorsandstaffundertheSAYEdividends, weregrantedon23December 2009 scheme. Optionswithanaggregateestimated Options withanaggregateestimated fairvalueof£323,000,determinedusingabinomialvaluation modelincludingexpected hadaweightedaverageexerciseexercisable priceof£7.53 at31December2009 £7.11). (2008: 4.0years).Options hadaweightedaveragecontractuallifeThe of3.3years(2008: optionsoutstandingat31December2009 The weightedaveragesharepriceatthedatesofexercise forshareoptionsexercised duringtheyearwas£7.93 £9.24). (2008: Exercised intheyear Forfeited intheyear Granted intheyear t3 eebr77248.19 777,214 At 31December At 1January 2234 5.52 (272,334) 906,963 7.74906,963 193,585 6.96 6.96 193,585 5,0)9.71 (51,000) Number of options share 2009 Weighted exercise average price 2009 £ 1,049,099 7.641,049,099 1824 7.17 (168,254) 0,6 7.74 906,963 30,000 8.14 30,000 Number of 382 9.07 (3,882) options 2008 share Further hares Weighted ility of en exercise average s 2008 price £ .

2 Share-based 27 payments accordance with theGroup’sriskappetite. policy istomanage short-termliquidityrequirements whilstmaintaininganappropriate levelofexposure to otherfi documents are in placetocoverthemanagement andmonitoringofeach typeofrisk.The primary objectiveoftheGroup’streasu risk, liquidityriskandmarketrisk. Procedures anddelegatedauthoritiesaredocumentedin aGrouptreasurymanualandpolicy The treasurydepartment,reportingthroughtheBanking Committee,hasprincipalresponsibilityformonitoring exposure tocredi Board). (the RIM InvestmentManagementLimited Banking Committee,which ofdirectorsRathbone isastandingcommittee oftheboard mitigation andmanagementofrisksaretheExecutiveCommittee, theAuditCommittee,RiskManagementCommitteeand subsidiaries andcertainoftheBoard’sstandingcommittees.The principalcommitteesthathaveresponsibilityfortheidentifi Board). The ofdirectorstheGroup’soperating Boardhasembeddedriskmanagementwithinthebusinessthroughboards The Group’soverallstrategyandpoliciesformonitoringmanagementoffi and therangeoffi The Groupregularlyreviewsitsriskmanagementpoliciesandsystemstorefl limits andcontrolstomonitortherisksadherence bymeansofreliableandup-to-dateinformationsystems. The Group’sriskmanagementpoliciesaredesignedtoidentifyandanalysethe risks thattheGroupfaces,tosetappropriateri The sectionsbelowoutlinetheGroup’sriskappetiteandexplain howitdefi marketrisk(which includesfairvalueinterestraterisk,cashfl (iii) liquidityrisk;and (ii) (i) credit risk; Group categorisesitsfi with therequirementsofFinancialServicesAuthority(theFSA)initsapplicationCapitalRequirementsDirective.T accordance withitsriskappetite,asdescribedintheGroup’sInternalCapitalAdequacyAssessmentProcess, preparedinaccord The Grouphasidentifi Financialriskmanagement 28 £1,299,000). (2008: The Grouprecognisedtotalexpenses of£1,219,000inrelationtoequity-settledshare-basedpaymenttransactions2009 they maybeexercised aregivenbelow: The numberofshare optionsoutstandingattheendofyear, theperiodsinwhich theyweregrantedandtheperiodsinwhich 09660 2013 696.00 813.502011–2018 1,116.002009–2016 743.50 2007–2014 810.002005–2012 2004–2011 915.80 827.50 2004–2011 2004–2011 985.00 932.502003–2010 814.172002–2009 2009 2008 2006 2004 2002 2001 2001 2001 2000 1999 Risk freerate Expected volatility Exercise price(pence) Exercisable Expected dividendyield 99732.50 2002–2009 1999 Year ofgrant Share price(pence) 061,172.00 2009–2016 2006 05852.002008–2015 415.002006–2013 2005 2003 nancial instrumentsthatitutilises. ed therisksarisingfromitsactivitiesandhasestablished policiesandprocedurestomanagetheseitemsin nancial risksintothreeareas: continued Exercise Pence price ow interestraterisk,currencyriskandpricerisk). nes andmanageseach categoryoffi ect changes inthebusiness,counterparties,markets nancial risk are set by the board ofdirectors(the nancial riskaresetbytheboard Exercise period 161,148 161,148 193,585 101,810 777,214 15,948 15,948 66,184 61,956 61,956 66,351 38,110 22,500 30,000 30,000 10,000 32.0% 9,622 5.3% 2.1% 696 803 2009 2009 No. – – nancial risk. nancial nancial risksin 906,963 181,528 101,810 189,676 cation, he 30,000 35,948 38,110 66,184 10,000 22,500 58,350 24,550 71,351 76,956 26.0% sk 5.0% 4.6%

t 814 814 2008 2008 ance

ry No. –

Rathbone Brothers Plc 93 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 94 Notes to the consolidated accounts monthly basis. purchase andsaleofassetsonaclient’sbehalf.Overdraftsareactivelymonitoredreportedto the BankingCommitteeona Overdrafts onclients’investmentmanagementaccountsarise from timetodueshort-termtimingdifferences betweenthe (a) Overdrafts credit riskontradedebtorsarisingfromtheTrust andTax andPensions Advisorybusinesses(trustandpensiondebtors). InternationalFinanceB.V.via previouslyRathbone The InternationalFinanceloanbook). Groupisalsoexposed (theRathbone to and The GroupprovidesloanstoclientsthroughitsInvestmentManagementoperations(theloanbook) Loans andadvancestocustomers liquidate specifi by theBankingCommitteeonamonthlybasis.The BankingCommitteemaysuspenddealinginaparticularcounterparty, or individual counterpartyorconnectedgroupofcounterparties.Counterpartyexposures aremonitoredonadailybasisandreviewe long-term ratingof‘A’ byFitch orequivalentratingbyMoody’s.Counterpartylimitsarealsoinplacetolimitexposure toan The Group’spolicyrequiresthatallsuch exposures areonlytakenwithcounterpartiesthathavebeenawardedaminimum surplus investmentmanagementclientcash,which isheldunderabankingrelationship,andtheGroup’sownreserves. certifi The Grouphasexposures toawiderangeoffi Loans andadvancestobanksdebtothersecurities nil). £6,322,000). Nosettlementbalanceswereimpairedatthebalancesheetdate(2008: (2008: daysbutnotimpairedat31December2009 werepastduebyfewer than90 Settlement balancesof£4,980,000 The InvestmentManagementandUnitTrust businesseshaveexposure tomarketcounterpartiesinthesettlementoftrades. terms aremonitoredonadailybasis. basis, which resultsinsecuritiesandcashbeingexchanged withinaveryclosetimeframe.Settlementbalancesoutsidestandard corresponding deliveryofasecurityorreceiptcash.The majorityoftransactionsarecarriedoutonadeliveryversuspaym Settlement riskarisesinanysituationwhereapaymentcashortransfer ofasecurityismadeintheexpectation ofa Settlement balances formal external ratings,theBankingCommitteealsoutilises marketintelligenceinformationtoassistitsongoingmonitoring. Moody’s Corporation(‘Moody’s’).Each exposure isassessedindividually, atinceptionandinongoingmonitoring.Inadditi both The Groupcategorises itsexposures basedonthelong-termratingsawardedtocounterpartiesbyFitch RatingsLtd(‘Fitch’) or tomeetrepaymentobligations. andpotentialborrowers taking intoaccounttheabilityofborrowers Exposure tocreditriskismanagedthroughsettingappropriateratingsrequirementsandlendinglimits.Limitsarereviewedreg against clients’assetsthatareheldandmanagedbyGroupcompanies. institutions. Investmentsarespreadtoavoidexcessive exposure toanyindividualcounterparty. Loans madetoclientsaresecu It istheGroup’spolicytoplacefundsgeneratedinternallyandfromdepositsbyclientswitharangeofhighqualityfi guarantees givenonclients’behalf. with otherbanksandholdinginterestbearingsecurities.The Groupalsohasexposure and tocreditriskthroughitsloanbooks through itsbanking,treasury, trustandpensionsadvisoryactivities.The principalsourceofcreditriskarisesfromplacing The Grouptakes on exposure tocreditrisk,which is theriskthatacounterpartywillbeunabletopayamountsinfullwhendu (i) Credit Financialriskmanagement risk 28 cates of deposit, money market funds and government bonds. These exposurescates ofdeposit,moneymarketfundsandgovernment bonds. principallyarisefromtheplacementof c holdings,inthelightofadversemarketinformation. continued nancial institutionsthroughitstreasuryportfolio which includes bankdeposits, nancial funds ent on to e, red

ularly,

d losses arose in the year (2008: none). losses aroseintheyear(2008: Impairment provisionsforcreditrisk,which relatesolelytotrustandpensiondebtors, aresetoutinnote15.Nootherimpai anticipated receiptsforeach individualexposure. The assessmentconsiders,whereapplicable,thevalueofanycollateralheld,changes totheexternal creditratingandthe allowances oncreditexposures aredeterminedbyanevaluationoftheincurredlossatbalancesheetdateonacase-by-casebas All creditexposures arereviewedindividually, atleast annuallyormoreregularlywhenindividualcircumstancesrequire.Impa date, basedonobjectiveevidenceofimpairment. Impairment provisionsarerecognisedforﬁ Impairment andprovisioning policies (i.e. contractswithapositivefairvalue),which inrelationtoderivativesisonlyasmallfractionofthenotional valueof At anyonetime,theamountsubjecttocreditriskislimitedcurrentfairvalueofinstrumentsthatarefavourablet control limitsonnetopenderivativepositions(i.e.thedifference betweenpurchase amountandt andsalecontracts),byboth From timetotime,theGroupmakesuseofderivativeﬁ Derivatives (note15). anditsGenevatrustoperationsin2009 2008 Other loansandadvancestocustomersareconstitutedbymadetheacquirersofGroup’sJerseytrustoperations in (e) Other debtors companies. Impairmentprovisionsaremadeforanydebtswhich areconsideredtobedoubtfulforcollection. and pensiondebtorsarereviewedonamonthlybasisbytheManagementCommitteesofGroup’sTrust andPension Advisory Trust andpensiondebtorsrelatetofees which havebeeninvoicedbutnotyetsettledbyclients.The collectionandageingof Trust andpensiondebtors (d) (note10). wasdisposedofon12November2009 InternationalFinanceloanbook The Rathbone RathboneInternationalFinanceloanbook (c) £4,555,000). committed (2008: £25,000,000)ofwhich(2008: £18,712,000 hadbeen £12,459,000)andafurther£5,260,000 hadbeenadvanced(2008: At 31December, was£30,000,000 thetotallendingexposure limitfortheInvestmentManagementloanbook are establishedwithclientsbeforeloansbecomeoverdueoruncovered. The BankingCommittee reviewsallloansonamonthlybasisandapprovesloanextensions. Where necessary, repaymentplans if required. nomineenameandareadvancedforamaximumofoneyear.Rathbones’ Extensionstotheinitialloanperiodmaybegranted have short-tomedium-termcashrequirements.Such loansarenormallymadeonafullysecuredbasisagainstportfoliosheldin Loans andshort-term overdraftsareprovidedasaservicetoInvestmentManagementclientswhogenerallyassetrich but Investmentmanagementloanbook (b) (i) Credit Financialriskmanagement risk 28 continued continued nancial reportingpurposesonlyforlossesthat havebeenincurredatthebalancesheet nancial instrumentstomanageinterestraterisk (note6).The Group maintains thecontract. he Group rment irment erm. trust

is.

Rathbone Brothers Plc 95 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 96 Notes to the consolidated accounts of trustandpensiondebtorswhereanormalsettlementperiod ofsevendaysisexpected. as pastduewhenthecontractualdateforsettlementhas passed andthebalancehasnotbeenrepaid,except inthecase of theloan,which aredescribed onpage95,andthoseloansthatnolongermeettheinitiallendingcriteria.Anexposure is r externally unrated,isanalysedbelowbetweenthoseloansthatremainwithinthe standardlendingcriteriarequiredattheince whichThe are al creditqualityofloansandadvancestocustomersthatwereneitherpastdue norimpairedat31December2009, Neitherpastduenorimpaired (a) nil). No loansandadvanceshavebeenrenegotiated(2008: Maximum exposuretocreditrisk (i) Credit Financialriskmanagement risk 28 Loans andadvancesaresummarisedasfollows: Loans andadvances 77.9%).represents investmentsindebtsecurities(2008: 12.9% ofthetotalmaximumexposure 17.8%) isderivedfromloansandadvancestobankscustomers(2008: and82.4% net carryingamountsasreportedinthebalancesheet. any collateralheldorothercreditenhancementsattached. For on-balancesheetassets,theexposures arebasedo setoutabove withouttakingaccount of and2008, tablerepresentsthegrosscreditrisk exposureThe tothe Group at31December2009 above impairment (note15) Less: allowancefor Past duebutnotimpaired Loan commitments Credit riskrelatingtooff-balancesheetexposures: – Listeddebtsecurities Loans andadvances tobanks e arigvle9,6 26,745 Outside standardlendingcriteria Standard lendingcriteria At 31December2009 26,827 92,661 92,661 Net carryingvalue Gross carryingvalue Neither pastduenorimpaired Financial guarantees Other ﬁ – Unlisteddebtsecuritiesandmoneymarketfunds Investment securities – Otherdebtors – Trust andpensiondebtors – InternationalFinanceloanbook – InvestmentManagementloanbook Settlement balances Credit riskrelatingtoon-balancesheetexposures: Impaired – Overdrafts Loans andadvances tocustomers nancial assets nancial continued continued andadvances 92,661 26,235 92,661 to banks Loans £’000 2009 – (82) – 82 – 510 Overdrafts ,6 872 28 – 22,137 258 – 3,167 18,712 ,6 872–2840826,235 4,098 258 – 18,712 3,167 £’000 – – 4,098 4,098 and advances Management to customers Investment loan book Loans £’000 £’000 2009 International loan book Finance £’000 and advances 944,641 7,7 39,412 39,587 175,973 175,973 175,973 38,627 778,000 22,663 22,663 92,661 18,712 Trust and 17,305 pension 5,260 5,260 6,018 3,167 debtors to banks £’000 £’000 Loans £’000 850 850 2008 2009 –(175)– 244 – 716 5 – – debtors Other £’000 1,224,167 to customers and advances to customers 952,978 175,973 eported 12,483 12,483 18,323 loans and 15,751 31,731 advances ption 4,492 4,492 4,555 1,001 5,000 1,021 859 £’000 Loans £’000 £’000 2008 2008 Total n l (i) Credit risk Financialriskmanagement 28 The gross amount of loans and advances by class to customers that were past due but not impaired at 31 December 2009 were: The grossamountofloansandadvancesbyclasstocustomersthatwerepastduebutnotimpairedat31December2009 Loans andadvancesthatarepastduenotconsideredimpairedunlessotherinformationisalsoavailabletoindicatethecon Pastduebutnotimpaired (b) by reference tothelong-termcreditrating awarded byFitch, orequivalentratingbyMoody’sasatthebalancesheetdate. isanalysedbelow The creditquality ofloansandadvancestobanksthatwereneitherpastduenorimpairedat31December2009 debtors is £82,000 (2008: £244,000).There £nil). debtors is£82,000(2008: wereno otherimpairedcreditexposures (2008: at31December2009 Allowance hasbeenmadeforindividuallyimpairedtrustandpension debtors.The balanceofindividuallyimpairedtrustandpen (c) Impaired Other Outside standard lending criteria – – 3,224 – 3,268 6,492 6,492 3,268 32,135 – – 3,224 282 – 14,878 12,483 4,492 – Outside standardlendingcriteria Standard lendingcriteria A toA+ <90 daysoverdue <90 AA- toAA+ At 31December2008 >365 daysoverdue >365 270–365 daysoverdue 180–270 daysoverdue daysoverdue 90–180 At 31December2009 35dy vru 2 1 –333 25 56 81 – 221 – – – – 112 25 56 221 81 221 – – – – – – – – – – – – – – daysoverdue >365 270–365 daysoverdue 180–270 daysoverdue daysoverdue 90–180 daysoverdue <90 At 31December2008 continued continued Overdrafts Overdrafts Overdrafts ,9 2431,0 8 ,6 38,627 3,268 282 18,102 12,483 4,492 £’000 £’000 £’000 2 9 716 – 495 221 – – 1 510 – 510 – – – – – 58 58 – – 40 40 – 91 – 91 – 120 – – 120 201 – 201 Management Management Management Investment loan book Investment Investment loan book loan book £’000 £’000 £’000 International International International loan book loan book loan book Finance Finance Finance £’000 £’000 £’000 92,661 92,661 Trust and Trust and Trust and pension debtors pension pension debtors debtors £’000 £’000 £’000 £’000 2009 – – debtors debtors debtors Other £’000 £’000 £’000 Other Other to customers 104,481 104,481 to customers to customers 175,973 loans and advances 71,074 loans and loans and advances advances trary. sion 418 £’000 £’000 £’000 £’000 2008 Total Total Total

Rathbone Brothers Plc 97 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 98 Notes to the consolidated accounts Moody’s long-termratingdesignation. basedonFitch’sThe tablebelowpresents ananalysisofdebtsecuritiesbyratingagencydesignation,asat31December2009, Debt securities (i) Credit Financialriskmanagement risk 28 date. Inthisanalysis,exposures arecategorisedbasedonthecountryofdomicilecounterparty. The followingtableanalysestheGroup’screditexposures, attheircarryingamounts,bygeographicalregionasthebalance (a) Geographical sectors rating downgrade.This mayhappeninrelationtospecifi investments inthelightofadversemarketinformation,forexample inanticipationoforresponsetoanyformalFitch orMo The BankingCommittee activelymonitorscounterpartiesandmayreduceriskbyeithersuspendingdealingorliquidating The Grouphascounterparty concentrationriskwithinitstreasuryassetsinthatexposure istoanumberofsimilarcreditinst Concentration ofcreditrisk AA- toAA+ – Overdrafts Loans andadvancestocustomers Loans andadvancestobanks Settlement balances At 31December2009 AAA At 31December2008 Other fi – Listeddebtsecurities – Unlisteddebtsecuritiesandmoneymarketfunds Investment securities – Otherdebtors – Trust andpensiondebtors – InternationalFinanceloanbook – InvestmentManagementloanbook A toA+ itddb euiis101 – 1,001 – – 846 4,492 – 540 1,001 470 18,323 – 18,323 3,482 – 15,751 12,483 846 4,087 609 952,978 – – 476,017 175,973 – – 128,419 – 11,664 476,961 11,874 47,554 Other fi – Listeddebtsecurities – Unlisteddebtsecuritiesandmoneymarketfunds Investment securities – Otherdebtors – Trust andpensiondebtors – InternationalFinanceloanbook – InvestmentManagementloanbook – Overdrafts Loans andadvancestocustomers Loans andadvancestobanks Settlement balances nancial assets nancial nnilast 945 8 228 31,731 12,228 68 19,435 assets nancial continued continued Goverment securities £’000 2009 – 84,000 – 84,000 84,000 694,000 778,000 – – – – 84,000 263,000 431,000 263,000 431,000 c banksorwithinaparticularcountrysector. market Money funds £’000 2009 Certifi of deposit cates £’000 2009 £’000 Total 2009 7,1 ,0 6 3,806 572,817 314,000 – 464,000 464,000 314,000 – 778,000 1,2 ,1 2,3 937,374 522,431 410,727 4,216 Goverment 40,892 289 289 40,892 51,480 92,661 19,168 162 19,168 3,333 22,663 25,759 79,000 849,220 953,979 25,759 79,000 95,351 200,110 15,621 – 1,684 17,305 Kingdom 17,975 – 737 18,712 securities Kingdom 2,303 497 367 367 497 2,303 3,167 United United £’000 £’000 £’000 768 – 768 768 2008 – – 224,016 529,853 224,016 529,853 – 3,268 – 3,268 –3,268 – 3,268 – – 830 4,098 – 3,268 – market Jersey Money Jersey £’000 £’000 £’000 2008 funds Certifi 40,223 1,216,846 1,216,846 40,223 the World of deposit the World Rest of Rest of £’000 £’000 £’000 cates 2008 itutions. ody’s sheet £’000 £’000 £’000 2008 Total Total Total or operate were: The Group’scredit exposures atthebalancesheetdate,analysedbyprimaryindustrysectorsinwhich ourcounterparties (b) Industry sectors (i) Credit Financialriskmanagement risk 28 Group isincreasinglyanetprovider ofliquiditytothebankingmarkets. liquidity ininvestmentmanagement clients’portfoliosasinvestmentmanagerspositionassets moredefensively. Consequently, t The Groupdoesnotrelyonexternal fundingforitsactivities.Current marketconditionshaveresultedinanincreasethel by Moody’s. with highqualitycounterparties,defi realisable atshortnotice.The Groupoperatesastrictsetofcriteriaforcounterparties toensurethatinvestmentsareliqui the FSA’s liquiditymismatch guidelines.Liquidityriskisprimarilymanaged byholdingcashandmarketableinstrumentswhich a can bemet.Liquiditymismatches aremonitoredonadailybasisagainsttheliquiditylimits setbytheBankingCommitteeand (the Bank)maintainsasurplusofimmediatelyrealisableassets overitsliabilitiessuch thatallknownand potentialcashobl primary responsibilityforensuringcompliancewiththeGroup’s liquiditypolicy, which InvestmentManag requiresthatRathbone The primaryobjectiveoftheGroup’streasurypolicyistomanageshort-termliquidity requirements.The treasurydepartmentha settled bydeliveringcashoranotherfi Liquidity riskisthethatGroupwillencounterdiffi (ii) Liquidity risk itddb euiis101 – 1,001 – – 846 846 1,001 – 18,323 15,751 18,323 – – 12,483 – 12,483 175,973 – 952,978 – – 15,751 – – – 175,973 – 928,220 – 24,758 Other fi – Listeddebtsecurities – Unlisteddebtsecuritiesandmoneymarketfunds Investment securities – Otherdebtors – Trust andpensiondebtors – InternationalFinanceloanbook – InvestmentManagementloanbook – Overdrafts Loans andadvancestocustomers Loans andadvancestobanks Settlement balances At 31December2008 Other fi – Listeddebtsecurities – Unlisteddebtsecuritiesandmoneymarketfunds Investment securities – Otherdebtors – Trust andpensiondebtors – InternationalFinanceloanbook – InvestmentManagementloanbook – Overdrafts Loans andadvances tocustomers Loans andadvances tobanks Settlement balances At 31December2009 nnilast 1 1,2 1,9 31,731 13,493 18,027 211 assets nancial assets nancial continued ned asthosewhohavebeenawardedalong-termratingof‘A’ byFitch orequivalent orabove nancial asset. nancial continued culty inmeetingobligationsassociatedwithfi 590111294,3 1,216,846 49,637 1,141,239 25,970 Public sector sector £’000 Public £’000 ,6 – 3,268 – 3,268 – 4,492 4,492 9,3 345937,374 43,435 893,939 – – – 5,973 778,000 16,690 – – 22,663 – – 778,000 – 768 –768 – 4,098 – – – – 4,098 – – 92,661 18,712 – 3,167 17,305 – 92,661 18,712 – 17,305 3,167 institutions nancial liabilitiesthatare institutions Financial Financial £’000 £’000 and other and other Private clients Private clients £’000 £’000 d andare igations evel of re ement s he £’000 £’000 Total Total

Rathbone Brothers Plc 99 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 100 Notes to the consolidated accounts (ii) Liquidity risk Financialriskmanagement 28 contracts at 31 December 2009 (2008: nil). (2008: contracts at31December2009 liquidity riskinrelationtonetsettled derivativecontractsislimitedtothefairvalueofunsettled contracts.There were As describedinnote6theGroup employsForward RateAgreementsinmanaginginterestraterisk fromtimetotime.The Group’s fl Derivative cash do nothaveacontractualmaturitydate,which historicalexperience showsareunlikelytobecalledintheshort-term. arebalancesthatrepayableondemandor Included withintheamountsduetocustomersondemand disclosedabove and liabilitiesbyremainingcontractualmaturitiesatthebalancesheetdate. The tablebelowpresents theundiscountedcashfl fl Non-derivative cash e iudt a 5571 5,3 8,1 660–112,168 – 36,690 280,711 350,538 (555,771) Net liquiditygap Cash fl At 31December2009 At 31December2008 Other fi Due tocustomers Settlement balances Deposits bybanks Other fi Investment debtsecuritiesandmoneymarketfunds Loans andadvances tocustomers Loans andadvances tobanks Settlement balances Cash andbalancesatcentralbanks Cash fl eoisb ak 153 ,0 656 9,950 – – 1,048,991 6,516 1,901 5,857 1,533 12,685 352,961 – 677,488 353 – 177,522 – – – 14,048 – 14,048 – 43,558 1,765 – 11,522 – 12,838 Net liquiditygap 6,936 – 979,709 151,614 Cash fl – 350 25,908 10,497 15,751 – Other fi 3 Due tocustomers 28,07815,751 Settlement 240,792 Deposits bybanks 631,817 79,022 Cash fl balances Cash fl Other fi Investment debtsecuritiesandmoneymarketfunds Loans andadvancestocustomers Loans andadvancestobanks Settlement Cash andbalancesatcentralbanks Cash fl balances Cash fl Cash fl nancial liabilities nancial assets nancial nnillaiiis9 565 4 1,6 – 37,836 – 11,869 343 13,924 – 25,615 9 23 6 13,792 103 liabilities nancial assets nancial ows arisingfromfi ows arisingfromfi ows arising fromfi ows arisingfromfi ows arisingfromfi ows arisingfromfi ows arisingfromfi ows arisingfromfi ows (derivativessettledonanetbasis) continued ows nnillaiiis72181132504986–828,430 – 9,876 5,034 101,322 712,198 nancial liabilities nancial assets nancial liabilities nancial liabilities nancial assets nancial assets nnilast 5,2 5,6 8,4 656–940,598 – 46,566 285,745 451,860 156,427 nancial liabilities nancial assets continued ows receivableandpayablebytheGroupundernon-derivativefi 5194 2,0 3,0 531175119,992 1,765 15,381 238,707 426,103 (561,964) 1,3 2,6 5,3 9631751,230,817 1,765 39,623 253,636 820,260 115,533 101,166 368,257 272,960 40,301 – 782,684 –782,684 40,301 272,960 368,257 101,166 1,7 515 ,6 – 767,719 – – 1,562 710,972 55,185 7,9 9,5 4992,4 –1,110,825 24,242 14,929 394,157 677,497 52,036 40,109 628 – – 92,773 – – 628 40,109 52,036 demand ,9 ,5 211620 – 29,649 8,050 3,198 12,151 6,250 ,2 ,3 ,7 ,0 –7,435 – 1,574 1,224 1,533 3,104 demand £’000 £’000 22 17,829 6 15 – 17,872 – 15 6 22 17,829 On On 217 22,157 – 31,119 – – 6,772 1,898 2 22,447 – – 22,157 315 – – – – 5 310 17,305 – – 17,305 Not more 3 months 3 months Not more £’000 £’000 than than more than 3 months more than 3 months but not but not 1 year 1 year £’000 £’000 After After more than more than but not 5 years 5 years but not 1 year 1 year £’000 £’000 After After nancial assets nancial 5 years 5 years £’000 £’000 After no unsettled After £’000 £’000 Total Total reported bytheircontractualpaymentdates.Capitalcommitmentsaresummarisedtheearliestexpected dateofpayment. are analysedbythedurationofcommitment.Future minimumleasepaymentsundernon-cancellableoperatingleasesare The contractualvalue oftheGroup’scommitmentstoextend credittoclientsandmaximumpotentialvalueoffi Cash fl Off balancesheetitems (ii) Liquidity risk Financialriskmanagement 28 Cash fl Interest raterisk (iii) Market risk Total liquidityrequirement generally lengthensthemismatch whentheyieldcurveisrisingandshortens itwhentheyieldcurveisfalling. maturity profi yield ontheGroup’sinterest-bearing assetsiscorrelatedtothefutureexpectation ofbaseratesandvariesdependingonthe and liabilities.Inparticular, customeraccountsandloanbalancesarerepriced veryshortlyafterchanges inbaserates, wher The Group’sprincipalexposure tocashfl market interestrates. interest rates.Fair valueinterest rateriskisthethatvalueofafi oa f aac he tm 0523641,6 03647,557 10,346 13,065 3,634 20,512 Total offbalancesheetitems oa f aac he tm 688 ,7 1,2 1,8 37,398 11,984 14,822 3,774 6,818 – 37,398 11,984 14,822 31,834 3,774 Total 11,984 offbalancesheetitems 6,818 Cash fl 14,813 3,774 150– At 31December2008 150 1,263 850–9 859 4,555– 4,555 Total offbalancesheetitems Cash fl At 31December2009 Total offbalancesheetitems Capital Operating leasecommitments Financial commitments Loan At 31December2008 guarantees commitments Capital commitments Operating leasecommitments Financial guarantees Loan commitments At 31December2009 ows arisingfromtheGroup’soffbalancesheetfi ow interestrateriskisthethatfuturecashfl ows arisingfromfi ows arisingfromfi le oftheGroup’s treasuryportfolio.The averagematuritymismatch iscontrolledbytheBankingCommittee,which continued nnillaiiis6747 9,5 1,2 2,4 –1,110,825 24,242 14,929 394,157 677,497 liabilities nancial liabilities nancial continued ow interestrate riskarisesfromthemismatch betweentherepricingofitsfi nancial liabilities (note 30) aresummarisedinthetablebelow. nancial liabilities(note30) ows ofafi 712,198 101,322 5,034 9,876 – 828,430 – 828,430 9,876 5,034 101,322 712,198 712,198 121,834 8,668 22,941 10,346 875,987 10,346 22,941 8,668 121,834 712,198 677,497 400,975 18,703 39,064 11,984 11,984 39,064 1,148,223 18,703 677,497 400,975 nancial instrumentwillfl demand demand nancial instrumentwillfl £’000 £’000 On On 0523641,6 036 47,557 10,346 13,065 3,634 20,512 – 14,002 – 14,002 Not more Not more 3 months 3 months 3 months 3 months Not more Not more 5,260 – 5,260 1,245 3,634 1,245 3,634 13,065 10,346 28,290 £’000 £’000 £’000 £’000 than than than than 5 – more than more than 3 months 3 months more than more than 3 months 3 months but not but not uctuate becauseofchanges inmarket but not but not 1 year 1 year 1 year 1 year £’000 £’000 £’000 £’000 After After After After uctuate becauseofchanges in

more than more than more than more than but not but not 5 years 5 years 5 years 5 years but not but not 1 year 1 year 1 year 1 year £’000 £’000 £’000 £’000 After After After After –

nancial guarantees nancial 5 years 5 years 5 years 5 years nancial assets nancial £’000 £’000 £’000 £’000 After After After After –

eas the 5,260 5,260 £’000 £’000 £’000 £’000 Total Total Total Total

Rathbone Brothers Plc 101 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 102 Notes to the consolidated accounts (iii) Market risk Financialriskmanagement 28 amounts, categorisedbytheearliercontractualrepricingormaturitydates. The tablebelowshows theconsolidatedrepricingprofi 31 December 2009 (2008: none). (2008: 31 December 2009 at thebalancesheet datefora2%decreaseor increaseininterestrates.The Groupheldnoforwardrate agreementsat exposure of72 days).The totalpotentialimpacton profi 48 days (2008: fourdays)torepricing which(2008: werematched bysterlingassetsaveraging 74 52days)torepricing, creatinga days(2008: million)ofsterlinginterestbearingliabilitiesaveragingtwo theBankhad£738.5At £993.4 31December2009, million(2008: of theinterestbearingliabilities comparedwiththeperiodtorepricingonacorrespondingamount ofinterestbearingassets. principal operatingsubsidiary. The potential totalprofi profi The £5,000,000)forthetotal BankingCommitteehassetanoverallpre-taxinterestrateexposure limitof£5,000,000(2008: At 31December2009 Liabilities Total fi Interest rate repricing gap (182,365) 138,068 130,467 36,911 – (9,538) 113,543 113,543 (9,538) – 36,911 130,467 138,068 (182,365) Interest raterepricinggap Total fi At 31December2008 Other fi Due tocustomers Settlement balances Deposits bybanks Other fi – debtsecuritiesandmoneymarketfunds – equitysecurities Investment securities Loans andadvances tocustomers Loans andadvances tobanks Settlement balances Cash andbalancesatcentralbanks Assets eoisb ak ,3 – ,3 615 – 9,201 – 10,424 1,044,351 – 483 663 6,135 – – 1,533 14,048 – – 15,341 14,048 1,017,440 175,973 351 170 1,533 – 3 – 39,412 7,830 953,979 – – – 483 Interest raterepricinggap Total 663 fi – – – – – Other fi 2,991 – Due tocustomers 2,991 – – – Settlement – 25,000 Deposits bybanks 10,000 6,911 – Liabilities 246,762 – 672,217 23,525 175,803balances 15,751 Total fi Other fi 15,751 348 – debtsecuritiesandmoneymarketfunds – Investment securities Loans andadvancestocustomers equity Loans andadvancestobanks Settlement Cash andbalancesatcentralbanks securities Assets balances t orlossresulting fromanunexpected immediateandsustained2%movementinsterlinginterest ratesfortheBank, nancial assets 580,603 139,000 132,622 40,000 – 48,396 940,621 940,621 48,396 – 40,000 132,622 139,000 580,603 nancial assets nnillaiiis7298 3 215 ,8 – 794 827,078 57,934 – 3,089 2,155 932 762,968 nancial liabilities nancial liabilities nancial assets nancial liabilities nancial assets nancial n nill aiiis––––– 37,998 – 37,998 – – 31,731 – 31,731 nancial liabilities nancial assets continued continued t orlossiscalculated onthebasisofaveragenumberdaystorepricing le oftheGroup’sfi 1,018,973 15,341 1,533 6,798 483 62,470 483 6,798 1,105,598 1,533 1,018,973 15,341 (147,080) 238,332 8,467 18,865 – (3,994) 114,590 114,590 (3,994) – 8,467 238,332 18,865 (147,080) 7,9 5,7 1,0 2,6 43 58,476 483 1,220,188 25,663 10,000 871,893 253,673 760,211 932 622 – – 4,596 4,596 766,361 – – 932622 760,211 467,000 139,000 132,000 – 40,000 778,000 21,417 – 5,328 26,745 186 2 – –163 – 92,661 –622 91,876 demand 2,757 – 1,533 – 3,089 7,379 demand £’000 £’000 310 –5 315 On On 22,157 – 22,157 – – 22,663 – 2,932 22,663 2,932 – 17,305 17,305 – 31,181 31,181 Not more 3 months 3 months Not more £’000 £’000 t after tax and equity was £2,088,000 (2008: £1,894,000) £1,894,000) (2008: t aftertaxandequitywas£2,088,000 than nancial assetsandliabilities,statedattheircarrying than more than 3 months more than 3 months but not but not 1 year 1 year £’000 £’000 After After more than more than but not 5 years 5 years but not 1 year 1 year £’000 £’000 After After 5 years 5 years £’000 £’000 After After Non-interest Non-interest 5 years 5 years £’000 £’000 days £’000 £’000 n Total Total liabilities, atcarryingamounts,categorisedbycurrency. IncludedinthetableareGroup’sfi exposure toforeign currencytranslationriskat31December2009. The Groupdoesnot haveanymaterialexposure totransactionalforeigncurrencyrisk.The tablebelowsummarisestheGroup’s and Dutch operationsduringtheyear(note10). Group’s structuralcurrencyexposure wassubstantiallyeliminatedonthedisposalofitsSwitzerland,Singapore,BritishVirgin are managedthroughtheuseofspotcontracts,fromtimetotime,soasreduceanycurrencyexposure toaminimalamount.Th The Groupmonitors itscurrencyexposures thatariseintheordinarycourseofbusinessonadailybasisandsignifi Foreign exchange risk exchange rates,remain constant. the USdollaror Eurowouldhavehadanequal andoppositeeffect. This analysisassumesthat allothervariables,inparticula and profi wouldhavereducedequity A 10%weakeningoftheUSdollar orEuroagainstthepoundsterling,occurringon31December 2009, (iii) Market risk Financialriskmanagement 28 eoisb ak ,0 – – 9,201 – – 2,876 1,044,351 – 28,653 10,696 1,002,126 9,201 232216205 13,395 14,048 Other fi Due tocustomers Settlement Deposits bybanks balances Liabilities Liabilities Total fi – equity securities 1,534 – 1,457 – 2,991 2,991 – 1,457 – 15,751 953,979 91 – 351 1,534 39,412 3 392 – – 579 175,973 18,972 3,343 – – 99 Loan commitments 14,689 11,158 12,994 Net onbalancesheetposition 348 953,979 148,478 20,338 Total fi 3 Total fi Other fi – debtsecuritiesandmoneymarketfunds – equitysecurities Investment securities Loans andadvancestocustomers Loans andadvancestobanks Settlement balances Cash andbalancesatcentralbanks Assets At 31December2008 Other fi Due tocustomers Settlement balances Deposits bybanks Other fi – debtsecuritiesandmoneymarketfunds – equitysecurities Investment securities Loans andadvances tocustomers Loans andadvances tobanks Settlement balances Cash andbalancesatcentralbanks Assets At 31December2009 Net on balance sheet position 112,463 482 405 193 113,543 113,543 193 405 – 5,260 482 5,260 112,463 Loan Net onbalancesheetposition commitments Total fi t after tax by £35,000 or £29,000 respectively (2008: £215,000 and£194,000respectively). A10%strengtheningof t aftertaxby£35,000or£29,000 respectively(2008: nancial assets 911,287 10,671 15,184 3,479 940,621 940,621 3,479 15,184 10,671 911,287 nancial assets nancial liabilities nancial assets nnillaiiis7884 019 479 ,8 827,078 3,286 14,779 10,189 798,824 nancial liabilities nnillaiiis3,8 13 ,0 1 37,998 13 1,202 103 36,680 liabilities nancial nnilast 096 0 0 4 31,731 4 801 20 30,906 assets nancial liabilities nancial assets nancial continued continued 1,061,402 11,031 30,071 3,094 3,094 30,071 11,031 1,061,402 1,105,598 ,6,2 4003,8 3,441 32,780 14,040 1,169,927 1,220,188 0,2 ,0 ,0 347 2,709 3,009 108,525 114,590 778,000 – 778,000 742,557 7,684 13,060 3,060 766,361 6001550 – 165520 26,060 26,745 222 833 686 15,564 17,305 66,853 9,353 66,853 3,257 13,198 92,661 2671 6 – 6 10 22,647 22,663 29,512 834 649 186 186 29,512 834 649 31,181 19,376 1,671 1,070 40 40 22,157 19,3761,070 1,671 4,555 – – 4,555 Sterling 2,158 – 2,158 774 – 2,932 7,379 – 7,379 Sterling £’000 £’000 1 – –315 – 5 310 US Dollar US US Dollar £’000 £’000 £’000 £’000 Euro Euro nancial assetsand cant exposures cant Other £’000 £’000 Other Islands r other £’000 £’000 Total Total e

Rathbone Brothers Plc 103 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 104 Notes to the consolidated accounts (iii) Market risk Financialriskmanagement 28 breaches duringthecourse oftheyear. BrothersPlcBoardinFebruary wasapprovedbytheRathbone ICAAP The 2010. There 2009 have beennocapitalrequirement approach tooperational risk. In calculatingthecapitalrequirement, theGrouphasadoptedstandardisedapproach tocreditriskandthebasicindicator Tier 2capital,which isunrealisedgainsarisingonthefairvaluationofequityinstruments heldasavailableforsale. • valueofgoodwillandother intangibleassets;and earnings,netofthebook Tier 1capital,which isthetotalofissuedsharecapital,retainedearningsandreservescreatedbyappropriations retai • The Group’sregulatorycapitalismonitoredbythetreasurydepartmentanddivided intotwotiers: tomaintainastrongcapitalbasesupportthedevelopmentofitsbusiness. • benefi tosafeguard theGroup’sabilitytocontinueasagoingconcernsothatitcanprovidereturns forshareholdersa • withintheGroupoperate; tocomplywiththecapitalrequirementssetbyregulatorsofbankingandother regulatedmarketswheretheentities • The Group’sobjectiveswhenmanagingcapitalare: InsuranceLimitedinregulatorycapitalvalues. due tothenon-consolidationofRathbone individual businesses,functionheadsandexecutive committeeswithintheGroup.Regulatory capitaldiffers fromaccountingcap the CapitalRequirementsDirective.The drawsontheGroup’sRiskManagementprocesswhich ICAAP isembeddedwithinthe Regulatory capitalisderivedfromtheGroupInternalCapitalAdequacyAssessmentProcess which (ICAAP), isarequirementof £184,631,000). (2008: was£182,489,000 31 December2009 Accounting capitalisdefi Capital 29 management of interestrateswillnotaffect theirfairvalue. There havebeennotransfers betweenlevelsduringtheyear. Moneymarketfundsaredemandsecuritiesandchanges toestimates Level 3:inputsfortheassetorliability thatarenotbasedonobservablemarketdata • or Level 2:inputsotherthanquoted pricesincludedwithinLevel 1thatareobservablefortheassetorliability, eitherdirec indirectly • Level 1:quotedprices(unadjusted) inactivemarketsforidenticalassetsorliabilities • used todeterminethefairvalue. The tablebelowanalyses fi of heldtomaturityinvestmentsecurities(note18). The fairvaluesof theGroup’sfi Fair values therewouldbenoimpactonprofi £299,000); isolation, resultinapre-taximpactonnetassetsof£293,000(2008: A10%fallinglobalequitymarketswould, £2,991,000). securities recognisedonthebalancesheetwas£2,931,000(2008: equity investmentsecurities,which arereportedattheirfairvalue(note16).At thefairvalueofequity 31December2009, prices (otherthanthosearisingfrominterestrateriskorcurrencyrisk).The Groupisexposed topriceriskthroughitshold Price riskisthe thatthefairvalueorfuturecashfl Price risk At 31December2009 Total fi – moneymarketfunds – equitysecurities Available forsalesecurities Assets ts forotherstakeholders;and nancial assets 2,153 84,779 – 86,932 86,932 – 84,779 2,153 nancial assets continued ned asthetotalofsharecapital,premium, retainedearningsandotherreserves.Total capitalat nancial instrumentsmeasuredatfairvalueintoahierarchy basedonthevaluationtechnique nancial assetsandliabilitiesarenotmateriallydifferent fromtheircarryingvalues,withtheexception continued ows ofafi ,5 7 – 2,932 2,153 779 Level 1 £’000 – 84,000 – 84,000 –84,000 – 84,000 nancial instrumentwillfl Level 2 £’000 uctuate becauseofchanges inmarket Level 3 £’000 t aftertax. tly ings of ned nd £’000 ital Total c The contractualamountsoftheGroup’scommitmentstoextend credittoitsclientsareasfollows: (c) Capitalexpenditure butnotprovidedintheaccountsamountedto authorisedandcontractedforat31December2009 (b) f The GroupmadecertaincommitmentsinrelationtothetransactionwithLloydsBankingGroup,asdisclosednote17. (f) beincurredinfutureyearsalthoughtheultimatecostremainsuncertain. InadditiontotheFinancialServicesCompensation Scheme leviesaccruedintheyear(note7)furtherlevycharges arelik (e) IndemnitiesareprovidedtoanumberofdirectorsandemployeesinourTrust andTax Servicesdivisioninconnectionwith t (a) Contingentliabilitiesandcommitments 30 d The Groupleasesvariousoffi (d) £nil). The fairvalueofthe guaranteesis£nil(2008: No provisionshavebeenmadefordoubtfuldebtsinrespectof theamountsowedbyrelatedparties. All amountsoutstandingwithrelatedpartiesareunsecuredandwillbesettledincash.Noguaranteeshavebeengivenorreceiv £nil). schemes (2008: The £3,000wasduefromthepension Group’stransactionswiththepensionfundsaredescribedinnote25.At 31December2009 the Group’sprofessional indemnityinsurancepolicy. One oftheGroup’snon-executive directorsisanexecutive directorofNovaeGroupPlc,arelatedentitywhich underwritesp services providedbycompanieswithintheGroup.Chargesforsuch servicesaremadeatvariousstaffrates. which weremadeonnormalbusinessterms.AnumberoftheCompany’sdirectorsandtheirclosefamilymembersmakeuse had grossoutstandingdepositsof£1,178,000 £396,000) £635,000)andgrossoutstandingloansof£193,000(2008: (2008: to43.At keymanagement andtheirclosefamilymembers audited partoftheRemunerationreportonpages36 31December2009 The remunerationofthekeymanagementpersonnelGroup,whoaredefi Relatedpartytransactions 31 Guarantees No laterthan1year Later than5years Later than1yearandnolater5years Undrawn commitmentstolendof1yearorless £592,000 (2008: £150,000). £592,000 (2008: acting asdirectorsonclientstructuresinthenormalcourseofbusiness. rights. The futureminimumleasepaymentsundernon-cancellable operatingleaseswereasfollows: ces undernon-cancellableoperatingleaseagreements.The leaseshavevaryingtermsandrenewal ned astheCompany’sdirectors,issetoutin 13,064 13,064 28,290 10,347 10,347 5,260 5,260 5,265 4,879 £’000 £’000 2009 2009 5 11,984 11,984 31,834 14,813 5,037 5,414 4,555 ely to art of hem 859 ed. £’000 £’000 2008 2008

Rathbone Brothers Plc 105 Notes to the consolidated accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 106 Notes to the consolidated accounts Cash fl Available forsale investmentsecuritiesareamountsinvestedinmoneymarketfundswhich arerealisableondemand. until maturityfromthedateofacquisition: For thepurposesofcashfl There havebeennomaterialeventsoccurringbetweenthebalancesheetdate and thedateofsigningthisreport. The aggregatenetassetsofentitiesdisposedduringtheyear(note10)atdatesdisposalwereasfollows: Available forsale investmentsecurities(note16) Loans andadvancestocustomers Included withinassetsheldforsale(note10) Prepayments, accruedincomeandotherassets Loans andadvancestobanks Cash andbalancesatcentralbanks Shares issuedinrelationtoshare-basedschemes forwhich Share premiumonsharesissued(note26) Share capitalissued(note26) Loans andadvances tobanks(note14) Cash andbalancesatcentralbanks(note13) Consolidatedcashfl 32 3 Eventsafterthebalance sheetdate 33 Cash andcashequivalentsdisposedof Consideration receivedincashandequivalents Net cashfl Cash andcashequivalents Satisfi Total considerationreceivable Loss ondisposal Accruals, deferred income,provisionsandotherliabilities Due tocustomers Property, plantandequipment no cashconsiderationwasreceived ows arisingfromissueofordinarysharescomprise: ed by: ed ow arisingondisposal: ow statement,cashandequivalentscomprisethefollowingbalanceswithlessthanthree months ow statement 139,044 (15,744) 84,000 84,000 55,039 (1,341) (1,654) (4,623) 17,374 17,374 1,638 1,638 2,193 2,799 1,721 (628) (211) £’000 £’000 £’000 313 313 313 524 123 2009 2009 2009 22 35 – 5 restated (note1) (18,440) 255,021 175,227 (4,941) 79,000 22,477 1,909 1,208 1,199 1,171 1,473 148 148 791 £’000 £’000 £’000 2008 2008 2008 21 – 9 3 Company accounts

Company balance sheet Notes to the individual accounts Notice of Annual General Meeting Five year record Corporate information Our ofﬁ ces Rathbone Brothers Plc 107 Company accounts Report and accounts 2009 Company balance sheet as at 31 December 2009

2009 2008 Note £’000 £’000 Fixed assets Investments in subsidiaries 37 22,749 22,562 Available for sale equity securities 37 2,932 2,991 Total ﬁ xed assets 25,681 25,553 Current assets Debtors Amounts owed by subsidiary undertakings 27,310 30,103 Other debtors 38 – due within one year 621 698 – due after more than one year 4,098 3,268 Prepayments and accrued income 686 841 32,715 34,910 Cash at bank and in hand 68 13 Total current assets 32,783 34,923 Creditors: amounts falling due within one year Bank loans 39 (6,155) (9,201) Amounts owed to subsidiary undertakings (78) (182) Other taxes and social security costs (895) (906) Accruals and deferred income (304) (330) Total current liabilities (7,432) (10,619) Net current assets 25,351 24,304 Total assets less current liabilities 51,032 49,857

Pension liability 40 (5,979) (4,121) Net assets 45,053 45,736

Called up share capital 41 2,165 2,143 Share premium account 42 31,756 28,957 Available for sale reserve 42 2,884 2,943 Proﬁ t and loss account 42 8,248 11,693 Equity shareholders’ funds 45,053 45,736

Approved by the Board of Directors on 23 February 2010

A D Pomfret R P Stockton Chief executive Finance director The accompanying notes form an integral part of the Company accounts. Company balance sheet 108 Rathbone Brothers Plc Report and accounts 2009 Tangible fi Impairment prepared underthehistoricalcostconvention,asmodifi The separatefi Basis ofaccounting Signifi 34 Notes totheindividualaccounts or loss. is derecognisedorimpairedatwhich timethecumulativegainorlosspreviouslyrecognisedinequityshouldbe inp expenditure intheprofi directly inequity(except forchanges arisingfrom fl Equity investmentsaresubsequentlycarriedatfairvalue.Gainsandlossesarisingfromchanges inthefairvaluearerecognis transferred, orwheretheCompanyhastransferred substantiallyallrisksandrewardsofownership. Financial assetsarederecognisedwhentherightstoreceivecashfl valuation techniques commonlyusedbymarketparticipants. techniques, includingtheuseofrecentarm’slengthtransactions,discountedcashfl Equity investmentsareinitiallyrecognisedatfairvalue.For unlistedsecurities,theCompanyestablishesfairvaluebyusing for liquidityorchanges ininterestrates,exchange ratesorequityprices. Available forsaleinvestmentsarethoseintendedtobeheldanindefi Available forsaleequitysecurities Investments insubsidiariesarecarriedatcostlessprovisionsforimpairment. Investments insubsidiaries through theprofi related toaneventoccurringaftertheimpairmentlosswasrecognisedinprofi profi account. Animpairmentlossinrespectofaninvestmentequityinstrumentsclassifi is impairedthecumulativelossthathasbeenrecognisedinreservesremovedfromandprofi indication thatthoseassetshavesuffered animpairmentloss.Where thereisobjectiveevidencethatanavailableforsalesec At each balancesheetdatetheCompanyreviewscarryingamountofitsfi previous impairment. may bewrittenuptoavaluenohigherthantheoriginaldepreciatedcost,shouldanexternal eventreversetheeffects ofa as anoperatingcosttotheprofi The carryingvalues oftangiblefi preceding year. The principalaccounting policiesaresummarisedbelow. They haveallbeenappliedconsistentlythroughouttheyearand relating tofi The 29nottopresentthedisclosuresrequiredbythatstandard Companyhas takenadvantageoftheexemption conferred byFRS applicable UnitedKingdomaccountingstandardsandlaw. t orloss.Ifthefairvalueofadebtinstrumentclassifi xed assets are subject to review for impairment in accordance with FRS 11:Impairmentoffi xed assetsaresubjecttoreviewforimpairmentinaccordancewithFRS nancial risksintheCompany’ssolusaccounts. nancial statements of the Company are presented as required by the Companies Act 2006. They havebeen nancial statementsoftheCompanyarepresentedasrequiredbyCompaniesAct2006. t andlossaccount. cant accountingpolicies t andlossaccountformonetaryassetsdirectly inequityfornon-monetaryassets),untilthefi t andlossaccountintheperiodwhich thisoccurs.The carryingvalueoftangiblefi xed assetsarewrittendownbytheamountofanypermanentimpairmentandlossischarged uctuations inforeignexchange rates,which arerecognisedasincomeor ed bytherevaluationofcertainfi ed asavailableforsaleincreasesandtheincrease canbeobjectively ows fromthefi nite periodoftime,which maybesoldinresponsetoneeds nancial assetstodeterminewhetherthereisany t andlossaccount,theimpairmentisreversed nancial assetshaveexpired orbeeneffectively ow analysis,optionpricingmodelsandother ed asavailableforsaleisnotreversedthrough nancial instruments,andinaccordancewith xed assetsandgoodwill. xed assets xed nancial asset nancial t andloss valuation ed urity rofi t

Rathbone Brothers Plc 109 Notes to the individual accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 110 Notes to the individual accounts of anyrelateddeferred taxassetorliability. The movementinthescheme surplus/defi term andcurrencytotheliability. The pensionscheme surplus(totheextent thatitisrecoverable)ordefi ofequival measured usingaprojectedunitmethodanddiscountedatthecurrentrateofreturnonhighqualitycorporatebond separately fromthoseoftheCompany. Pension scheme assetsaremeasuredusingmarketvalues.Pension scheme liabilitiesare Payments todefi items andactuarialgainslosses. rate method. Loans andreceivablesareinitiallymeasuredatfairvaluesubsequentlycarriedamortisedcostusingtheeffective inter Loans andreceivables the guarantee. contract asacontingentliabilityuntilsuch timeasitbecomesprobablethattheCompany will berequiredtomakeapaymentu considers thesetobeinsurancearrangements,andaccountsforthemassuch. Inthisrespect,theCompanytreatsguarantee Where theCompanyentersintofi Guarantees timing differences canbededucted. extent thatitismorecertainthannottherewillbesuitabletaxableprofi at thebalancesheetdate,except whereotherwiserequiredbyaccountingstandards.Deferred taxassetsarerecognisedtothe Full provision,withoutdiscounting,ismadefordeferred taxationarisingfromtimingdifferences which havearisenbutnotre Deferred taxation The Companyoperates pensionschemes providingbenefi Pension liability The costofshare-based paymentsrelatingtosubsidiaries’directorsandstaffarerecharged tothesubsidiaries. of theliabilityisremeasuredwithanychanges infairvaluerecognisedprofi liability. At thedateonwhich theliabilityissettled,andateach balancesheetdatebetweengrantandsettlement,the For cashsettledshare-basedpayments,aliabilityisrecognisedfortheservicesreceived,measuredinitiallyatfairvalu number ofshareoptionsthatvestexcept whereforfeiture isonlyduetosharepricesnotachieving thethresholdforvesting. terms andconditionsuponwhich theoptionsweregranted.The amount recognisedasanexpense isadjustedtorefl entitled totheoptions.The fairvalueoftheoptionsgrantedismeasuredusinganoptionpricingmodel,takingintoaccountt in equity. The fairvalue is measuredatgrantdateandspreadovertheperiodduringwhich theemployeesbecomeunconditionall after 7November2002andnotvestedasat1January2005isrecognisedanemployeeexpense withacorrespondingincrease options andshareawardsinrelationtotheCompany’sShareIncentivePlanLong Term IncentivePlangrantedtoemployees The Company’sequity-settled shareoptionprogrammeallowsemployeestoacquiresharesoftheCompany. The fairvalueof Share-based payments Signifi 34 the debtisallocatedtoperiodsovertermofataconstant rateonthecarryingamount. Immediately afterissuedebtisstatedatthefairvalueofconsideration received,afterdeductionofissuecosts.The fi Interest bearingborrowings cant accountingpolicies ned contributionretirementbenefi nancial guaranteecontractstotheindebtedness ofsubsidiaries,theCompany continued t schemes arecharged asanexpense astheyfalldue. ts basedonfi nal pensionablepay. The assetsoftheschemes areheld ts fromwhich thefuturereversalofunderlying t orlossfortheyear. cit issplitbetweenoperatingcharges, fi cit isrecognisedinfull,net ect theactual nance costof e ofthe fairvalue versed he est nance nder ent y Details oftheCompany’sdividendspaidandproposedforapprovalatAnnualGeneralMeetingaresetoutinnote11. Dividends 36 for theyear. BrothersPlcreportedaprofi Rathbone theCompanyhaselectednottopresentitsownprofi oftheCompaniesAct2006 As permittedbySection408 Profi 35 A fulllistoftheCompany’ssubsidiaries willbeincludedintheCompany’sannualreturntoCompanies House. The Companyowns,directlyorindirectly, 100%oftheordinarysharecapitalallsubsidiaries. heldbysubsidiaryundertaking * theprincipalsubsidiaryundertakings, wereasfollows: At 31December2009 Trust planstoliquidateRathbone At 31December2009 CompanyB.V. Bank(BVI)Limitedwerewelladvanced. andRathbone Trust theCompanydisposedofitssubsidiaryRathbone On 17November2009 InternationalB.V. forcashconsideration. Pensionsubsidiary Rathbone &AdvisoryServicesLimitedforcashconsideration. theCompanyacquiredafurther200,000shares(withnominalvalueof£1each)On 25September2009 initswhollyowned Investments 37 The averagenumber ofemployeesduringtheyearwasasfollows: Auditors’ remunerationforauditandotherservicestotheCompanyaresetoutinnote7. £24,968,000). (2008: Shared services Trust andTax Unit Trusts t3 eebr20 27929225,681 2,932 22,749 At 31December2009 ahoeTutCmayBV h ehrad Trust services Stockbroking Trust services Banking The Netherlands Unittrust management Pension advisoryservices GreatBritain Britain Great Britain Great GreatBritain BritishVirgin Islands Investmentmanagement Investment management 25,553 Jersey GreatBritain 2,991 22,562 PensionRathbone &AdvisoryServicesLimited TrustRathbone CompanyB.V. UnitTrustRathbone ManagementLimited* Stockbrokers Limited* Rathbone TrustRathbone CompanyLimited InvestmentManagementInternationalLimited* Rathbone Bank(BVI)Limited* Rathbone InvestmentManagementLimited Rathbone Subsidiary undertaking Net lossfromchange infairvalue Disposals Additions At 1January2009 Investment Management t fortheyear t aftertaxforthefi nancial year ended 31 December 2009 of£23,243,000 nancial yearended31December2009 onr ficroainActivity andoperation Country ofincorporation Investments in subsidiaries £’000 428 200 – 200 671 179 179 2009 1)–(13) (13) 40 24 5)(59) – (59) Available for sale equity securities and bankingservices £’000 t andlossaccount 430 430 £’000 172 676 2008 Total 43 31

Rathbone Brothers Plc 111 Notes to the individual accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 112 Notes to the individual accounts 4 Pension 40 liability theLondoninstalments endingon4April2011.Interestispayabletheloanat0.7%above Inter-BankOffer Rate. £9,201,000)ofanunsecuredtermloanwhichThe isrepayableinfour, Companyhasdrawndown£6,155,000(2008: six-monthly Bank 39 loans approximately equalannualinstalmentsendingin2012. Thewith anominalvalueequivalentto£831,000at31December2009. loandoesnotbearinterestandisrepayableinthree Included withinloansandreceivablesisaSwissFranc denominatedloantotheacquirerofGroup’sGenevatrustoperations repayment dateofthenoteswasreassessedduringyearandextended bytwoyearsto2015. and interestincomeisrecognisedovertheexpected life ofthenotesundereffective interestratemethod.The expected England baserate.The carryingvalueofthenoteshasbeendiscountedto£3,267,000 £3,268,000) (2008: at31December2009 notes’ nominalvalueforthefollowingtwoyears.Thereafter, interestisreceivableonthenotes’fullnominalvalueatBa The notesbearnointerestforthreeyearsfromissue.InterestisthenreceivableattheBankofEnglandbaserateonhalf refi Theacquirer oftheGroup’sJerseytrustoperationsin2008. notesarerepayableontheoccurrenceofcertainevents,principal Included withinloansandreceivablesarevendorloannotes(‘notes’)withanominalvalueof£5,000,000thatwereissuedtoth Other 38 debtors in note26totheConsolidated accounts. Details ofthesharecapitalCompanytogetherwithchanges thereto,optionsthereonandshare-based paymentsareprovide Share 41 capital Details ofthedefi The pensionliabilityreportedfortheCompanyisstatednetofrelateddeferred tax. Consolidated accounts. The movementon thedeferred taxaccountisonlyattributabletoshare-basedpaymentsandasfollows: 28%). (2008: Deferred incometaxesarecalculated onalltemporarydifferences undertheliabilitymethodusinganeffective taxrateof28% nancing oftheoperationsdisposedof. Related deferred tax(note19) Charged toprofi At 1January Group pensionliability(note25) Corporation taxdebtor Deferred taxasset Loans andreceivables (dueaftermorethanoneyear) ned benefi ned t andlossaccount t pensionschemes operatedbytheCompanyandchanges theretoareprovided in note25tothe 344) (3,434 4,098 4,098 9,413 5,979 4,719 (360) £’000 £’000 £’000 298 658 298 323 2009 2009 2009 nk of the (1,602) (1,881) 3,966 3,268 3,268 4,121 2,539 2,539 5,723 ly the e

658 658 £’000 £’000 £’000 2008 2008 2008 40 d 3 Reconciliationofmovementsinshareholders’funds 43 No provisionshavebeenmadefordoubtfuldebtsinrespectof theamountsowedbyrelatedparties. All amountsoutstandingwithrelatedpartiesareunsecuredand willbesettledincash.Noguaranteeshavebeengivenorreceiv £3,000 wasduefromthepensionschemes £nil). (2008: The Company’stransactionswiththepensionfundsaredescribedinnote25to theConsolidatedaccounts.At 31December2009 part oftheCompany’sprofessional indemnityinsurancepolicy. One oftheCompany’snon-executive directorsisanexecutive directorofNovaeGroupPlc,arelated entityofwhich underwrites 8nottodisclosetransactionsandbalanceswithitssubsidiaries The Companyhastakenadvantageoftheexemption givenbyFRS byasubsidiaryundertaking. The Company’sobligationsunderoperatingleasesareborne Contingentliabilitiesandcommitments 44 4 Reserves 42 Net (reductionin)/additiontoshareholdersfundsfortheyear Share capitalissued Share-based payments Dividends paid Profi hrhles ud t3 eebr45,053 Relatedpartytransactions 45 Shareholders’ fundsat31December Shareholders’ fundsat1January – costofsharesissued/purchased – transfer toliabilitiesforcash – valueofemployeeservices Share-based payments Revaluation ofinvestmentsecurities Actuarial gainsandlosses Shares issued Dividends paid Profi At 1January2009 Other recognisedgainsandlossesrelatingtotheyear t3 eebr20 1762848,248 2,884 31,756 At 31December2009 settled awards t fortheyear t fortheyear Share premium 28,957 2,943 28,957 2,943 11,693 2,799 £’000 Available for sale reserve (18,066) 23,243 45,736 (8,685) 2,821 (683) £’000 £’000 2009 (59) 4 loss account (18,066) (17,503) 24,968 24,968 41,996 Profi 45,736 23,243 (4,504) (1,096) (8,626) 1,208 1,208 1,219 3,740 (429) (119) t and ed. £’000 £’000 2008 .

Rathbone Brothers Plc 113 Notes to the individual accounts Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 114 Notice of Annual General Meeting c toincurpoliticalexpenditure, (c) tomakedonationspoliticalorganisations otherthanpoliticalparties;and (b) tomakedonations politicalpartiesorindependentelectioncandidates; (a) theCompany andanycompanywhich isorbecomes oftheCompanies Act2006 That inaccordancewithsection366 12 Political donations 10 To appoint Auditors that alldirectorsseekingelectionorre-electioncontinuetobeeffective anddemonstratecommitmenttotherole. re-election. Following formalperformanceevaluation bytheBoardandindividualappraisalchairman, theBoardconfi the membersateitheroftwoimmediatelypreviousAnnualGeneralMeetingsshallretirefromoffi Article 94oftheArticlesAssociationCompanyrequiresthateach directorwhohasnotbeenelectedorre-electedby page 29inthecaseofKate Avery andKathryn on6January2010. Matthewswhowereappointedtotheboard Biographical detailsofthedirectorsseekingelectionorre-electioncanbefoundonpages25to26andinDirectors’repo To re-electRichard Smeeton asadirectoroftheCompany. 9 To re-electAndyPomfret asadirectoroftheCompany. 8 To re-electAndrewMorrisasadirectoroftheCompany. 7 To re-electRichard Lanyon asadirectoroftheCompany. 6 To re-electCarolineBurtonasadirectoroftheCompany. 5 To electKathryn Matthews asadirectoroftheCompany. 4 To electKate Avery asadirectoroftheCompany. 3 Electionandre-electionofdirectors and theresultofthisresolutionisadvisoryonly. report which mustbeapprovedbyshareholdersingeneralmeeting. This doesnotaffect thedirectors’entitlementstoremunerat requiresthepreparationofthis to43.PartThe 15oftheCompaniesAct2006 Remuneration reportcanbefoundonpages36 To approvetheRemunerationreportforyearended31December2009. 2 To adopttheReportofdirectorsandAuditedAccountsforyearended31December2009. 1 ReportandAccounts 2009 Resolutions 14to18arespecialresolutionsrequiringamajorityof75% ormore. classifi Resolutions 1to13areordinaryresolutionsrequiringamajorityofmorethan50%.Resolutionisanresolutionbut onWednesdayLondon W1S2UD 5May2010at12.00noontoconsiderand,ifthoughtfi Notice isherebygiventhatthethirty-ninthAnnualGeneralMeetingofCompanywillbeheldat159NewBondStreet, Notice ofAnnualGeneralMeeting fi The auditorsofapubliccompanymustbeappointedforeach fi To authorisethedirectors toagreetheremunerationofauditors. 11 nancial yeararelaid. a subsidiaryoftheCompanyduringperiodtowhich thisresolutionrelatesbe andisherebyauthorised: are laid. ed by Article 60 oftheArticlesAssociationCompanyasnon-routine, specialbusiness. ed byArticle60 i theauthorityconferred bythisresolution shallcommenceonthe dateonwhich itispassedandexpire 15months (i) Provided that: (or adjournment thereof)afterthepassingofthis resolution; after thepassing ofthisresolutionor, ifearlier, ontheconclusion oftheCompany’snext AnnualGeneral Meeting KPMG Audit Plcasauditorsuntiltheconclusionofnext AnnualGeneralMeetingbeforewhich accounts nancial yearatthemeetingwhich theaccountsforprevious t, passthefollowingresolutions. ce andseekelectionor rms rt on is ion 3 a That thedirectorsbe andtheyareherebygenerallyunconditionallyauthorisedinaccordancewithsection551ofthe (a) 13 Authority toallotrelevantsecurities Political donations b For thepurposesofthisresolution‘rightsissue’meansanoffer toordinaryshareholdersinproportion(asnearlyasmay (b) candidates andtoincurpoliticalexpenditure uptothespecifi obtain shareholderapprovalfortheCompanytomakedonationspoliticalparties,organisationsandindependentele and thereforepresentspotentialforinadvertentortechnical breach. The Boardthereforeconsidersthatitwouldbeprudentto ambiguous defi candidates andtheBoardwillnotusetheseauthorities,ifgiven,todoso.However, includesbroadand theCompaniesAct2006 The Companyhas apolicythatitdoesnotmakedonationstopoliticalparties,organisationsorindependentelection been authorisedtomakedonationsbytheCompany’sshareholders. twelve monthperiodtoapoliticalpartyorotherorganisationsanindependentelectioncandidateunlesstheyh prohibitstheCompanyanditssubsidiariesfrommakingdonationsofmorethan£5,000inany Part 14oftheCompanies Act2006 As at23February 2010,theCompanydoesnotholdanysharesincapitalof intreasury. used forfullypre-emptiverightsissues. (a)(ii) beingapproximately afurther33% oftheissuedsharecapitalCompanyat23February 2010.This authoritymaybe In addition,thisresolutionseekstoauthorisethedirectorsallot moreordinaryshares,limitedtotheamountsetoutinp by theresolutionsoastoenablethemrespond,ininterests oftheCompany, toanyappropriateopportunitiesthatmaya shares, limitedtoapproximately 33%oftheissuedsharecapital oftheCompanyat23February 2010, incircumstancesdefi Paragraph (a)(i)ofthisresolutionisproposedannuallyinordertoprovideameasure ofauthoritytothedirectorsalloto i) comprisingequitysecurities(asdefi (ii) uptoanaggregatenominalamountof£710,000; and (i) rights tosubscribefororconvertanysecurityintosuch shares: (the‘Act’)Companies Act2006 toexercise allthepowersofCompanytoallotsharesinandgrant securities, (ii)theissue,transfer and/or holdingofanysecuritiesincertifi exclusions orotherarrangementsasthedirectorsmaydeemnecessaryexpedient inrelationto(i)fractionsofsuch (or othernegotiabledocument)which maybetradedfora period beforepaymentforthesecuritiesisdue,subjecttosuch with therightsattached tosuch class)tosubscribe furthersecuritiesbymeansoftheissuearenounceableletter be practicable)totheirexisting holdings(and,ifapplicable,totheholdersofanyotherclassequitysecurityinaccorda such authoritiestoexpire 15monthsafterthepassingof this resolutionor, ifearlier, ontheconclusionof ii inthisresolutiontheexpressions ‘donation’, ‘politicalparties’, ‘politicalorganisation’, ‘politicalexpenditure’ and (iii) theaggregateamountofsuch donationsandexpenditure shallnotexceed £50,000andtheamountauthorisedunder (ii) or the requirements of any regulatory body oranystockor therequirementsofanyregulatorybody exchange, inanyterritory. represented bydepositaryreceipts,(v)treasurysharesor(vi)anylegalpracticalproblemsarisingunderthelawsof, of oneormorecurrenciesformakingpaymentsinrespectsuch offer, (iv)anysuch sharesorother securitiesbeing revoked withoutprejudicetoanyallotmentofsecuritiespursuantthereto. after such expiry. arehereby oftheCompaniesAct1985 Allpreviousauthoritiestodirectorspursuantsection80 respect ofoffers oragreementsmadebeforesuch expiry, which wouldormightrequirerelevantsecuritiestobeallotted such expiry, theauthoritiesshallineach casestillpermitthe Company tomakeallotmentsofrelevantsecuritiesin Company’s next AnnualGeneralMeeting(oradjournmentthereof)afterthepassingofthisresolution.Notwithstanding £710,000 inconnectionwithanoffer bywayofarightsissue ‘independent electioncandidate’havethemeaningssetoutinPart 14oftheCompaniesAct2006. each shallalsobelimitedtosuch ofparagraphs(a),(b)and(c)above amount;and nitions ofpoliticaldonationsandexpenditure, which mayhavetheeffect ofcoveringsomenormalbusinessactivities, continued ned in section 560 oftheAct),uptoafurtheraggregatenominalamount ned insection560 ed limitintheforthcomingyear. cated formorinuncertifi cated form,(iii)theuse aragraph rdinary

ave ned rise. ction nce

Rathbone Brothers Plc 115 Notice of Annual General Meeting Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 116 Notice of Annual General Meeting general authority. ListingAuthorityorcompanylawtorequireshareholderapprovalforthespecifi for theUK appropriate opportunitiesthatmayarise.For transactionsofasubstantialnatureinvolvingtheallotmentshares,itisnor Renewal ofthislimitedauthoritywillenablethedirectorstoissueshares,ininterestsCompany, inresponsetoan at thatdate.This compareswithinstitutionalshareholderguidelinelimitsof7.5% inanythree-yearperiod. shareswithanominalvalueof£50,97431 December2009, wereallotted forcash,representing2.4%oftheissuedsharecapital shares (beingacquiredandheldbytheCompany)withoutnecessarilyinvolvingshareholders.Overthreeyearsto payment istobewhollyincash.Additionally, theresolutionseeksauthorityforCompanytosellorotherwisedealwithtr 23 February 2010,regardingallotments,otherthantomembersproportionatelytheirrespectiveshareholdingsandforwhich This fi For thepurposesofthisresolution‘rightsissue’hassamemeaningasin13notice (c) The powersgivenbythisresolutionshallexpire 15monthsafterthepassingofthisresolutionor, ifearlier, on (b) That thedirectorsbeandthey areherebyempoweredpursuanttosections570 and573 oftheCompaniesAct2006 (a) 14 Power towaivepre-emptionrights c themaximumpricewhich maybepaidforanordinaryshareisthe higher of(i)anamountequalto105%the (c) theminimumpricewhich maybepaid foranordinaryshareis5p; (b) themaximumnumberofordinaryshares intheCompanyherebyauthorisedtobeacquiredis2,100,000shares (a) That thedirectorsbeandtheyareherebygrantedpursuanttosection701 (the‘Act’) oftheCompaniesAct2006 general 15 Authority topurchase ordinary shares of 5peach uponandsubjecttothefollowingconditions: and unconditionalauthoritytomakemarketpurchases (asdefi rst specialresolutionseeksauthority, limitedtoapproximately 5%oftheissuedsharecapitalCompanyat this meeting. are herebyrevokedwithoutprejudicetoanyallotmentofsecuritiespursuantthereto. securities tobeallottedaftersuch expiry. oftheCompaniesAct1985 Allpreviousdisapplications ofsection89(1) securities inrespectofoffers oragreementsmadebeforesuch expiry which wouldormightrequireequity resolution. Notwithstandingsuch expiry, theauthority shallstillpermittheCompanytomakeallotmentsofequity the conclusionofCompany’snext AnnualGeneralMeeting (oradjournmentthereof)afterthepassingofthis asifsection561oftheAct didnotapplytoanysuch allotment.References hereintotheallotmentofequitysecurities pursuanttotheauthoritygivenbyparagraph(a)(ii)ofresolution13innoticethismeetingconnectionwith (ii) uptoanaggregatenominalamountof£105,000;and otherthanpursuanttoparagraph(a)(i)(A)above, (B) inconnectionwithanyrightsissue,openoffer orotherpre-emptiveoffer, openforacceptanceaperioddetermined (A) pursuanttotheauthoritygivenbyparagraph (a)(i)ofresolution13inthenoticethismeeting: (i) (the ‘Act’) to allotequitysecurities(asdefi of expenses); and (ii) theamountstipulatedbyArticle 5(i)oftheBuy-back and Stabilisation Regulation2003(ineach case,exclusive Offi average ofthemiddlemarketquotations foranordinarysharetakenfromtheLondon Stock Exchange Daily (being approximately 5%oftheissuedsharecapitalCompanyat23February 2010); cial Listforthe fi shall includethesaleoftreasuryshares(withinmeaningsection724(5) oftheAct). a rightsissue and or anystock exchange in,anyterritory; shares or(vi)anylegalpracticalproblemsarisingunderthelawsof,requirementsofregulatorybody in respectofsuch offer, (iv)anysuch sharesorothersecuritiesbeingrepresentedbydepositaryreceipts,(v)treasury securities incertifi necessary orexpedient inrelationto(i)fractionsofsuch securities,(ii)theissue,transfer and/orholdingofany with therightsattached tosuch class),subjecttosuch exclusions orotherarrangements asthedirectorsmaydeem holdings ofordinaryshares(and,ifapplicable,totheholdersanyotherclassequitysecurityinaccordance by thedirectors,toholdersofordinarysharesonregisteranyfi ve businessdays immediatelyprecedingthedayonwhich theshareispurchased and cated formorinuncertifi ned in section 560 oftheAct),paymentforwhich istobewhollyincash: ned insection560 cated form,(iii)theuseofoneormorecurrenciesformakingpayments ned by section 693 oftheAct)anyitsordinaryshares ned bysection693 xed recorddateinproportiontotheir c transactionnotwithstandingthis mal easury y to allshareholders. an AnnualGeneralMeeting)bythepassingofaspecialresolutioneach yearprovidedthatvotingbyelectronicmeansisavailab for generalmeetingsoftheCompanyto21days.This noticeperiodcanbereducedto14daysforgeneralmeetings(otherthan increasedthenoticeperiod whichThe came intoforceon3August2009 Companies(Shareholders’Rights)Regulations2009 That anygeneralmeetingoftheCompany, otherthananAnnualGeneralMeeting,maybeconvenedbythegivingofnot 16 Authority fortheconveningofgeneralmeetingsCompanyon14cleardays’notice Authority topurchase ordinaryshares provisions. Accordinglytherelevant enablingprovisionshavebeenremovedintheNewArticles. will onlyrequireshareholderauthority todoanyofthesethingsanditwillnolongerbenecessary forarticlestocontainen to undertaketherelevantaction. The acompan CurrentArticlesincludetheseenabling provisions. UndertheCompaniesAct2006 consolidate orsub-divideitsshares andtoreduceitssharecapitalorotherundistributablereserves aswellshareholdera acompanyrequiredspecifi Under theCompaniesAct1985, Authoritytopurchase ownshares,consolidateandsub-divide andreducesharecapital (iii) but ifitdidsothedirectorswouldneedshareholders’authority toissuenewsharesintheusualway. authorised bythearticles.The NewArticlescontainsuch anauthorisation.The Companyhasnoplans toissueredeemableshares manner ofredemption.The enablesdirectorstodeterminesuch CompaniesAct2006 mattersinsteadprovidedtheyareso ifacompanywishedtoissueredeemableshares,ithadincludeinits articlesthetermsand Under theCompaniesAct1985, (ii) Redeemable shares in acompany’sconstitution. in theNewArticles.This isinlinewiththeapproach advocatedbytheGovernmentthatstatutory provisionsshouldnotbedupl Provisions areinthemaintoberemoved intheCurrentArticleswhich replicateprovisionscontainedintheCompaniesAct2006 Articleswhich duplicatestatutoryprovisions (i) below.Current Articlesareavailableforinspection,asdescribedinthenotestoNoticeofAGM in The havenotbeennoted.The Companies(ModelArticles)Regulations2008 NewArticlesshowingallthechanges tothe nature orwhich merelyconformthelanguageofNewArticleswiththatusedinmodelarticlesforpubliccompaniesseto ofthechanges introducedintheNewArticles aresummarisedbelow.Some Changes,which areofaminor, technical orclarifying the CompaniesAct2006. (the‘Shareholders’RightsRegulations’)andtheimplementationoflastparts (Shareholders’ Rights)Regulations2009 Company’s currentarticlesofassociation(the‘CurrentArticles’)totakeaccountthecomingintoforceCompanies This specialresolutionseeksauthoritytoadoptnewarticlesofassociation(the‘NewArticles’)inorderupdatethe That witheffect fromtheconclusionofmeetingArticlesAssociationproducedtoandinitialled 17 Adoption ofnewArticles ofAssociation back sharesunderthisresolutionwere usedinfull. 1.8% oftheissuedordinarysharecapitalCompanyatthatdateandwouldrepresentapproximately 1.9%iftheauthorityt At 23February 2010therewereoptionsoutstandingtosubscribefor777,214 newordinarysharesintheCompany. This represents will beheldastreasurysharesdefi consider thatitwouldbeadvantageoustotheCompanyandeffect wouldbetoenhanceearningspershare.Sharespurchased purchase theCompany’sownordinary sharesundercertainstringentconditions.The authoritywillbeusedonlywhenthedirecto t This secondspecial resolutionistorenewtheauthoritygranteddirectorsatAnnualGeneralMeetingon7May2009 theauthorityherebyconferred shall(unlesspreviouslyrenewed)expire 15monthsafterthepassingofthisresolutionor, (d) less than14cleardays’notice. substitution for, andtotheexclusion of,theexisting ArticlesofAssociationtheCompany. by thechairman ofthemeetingforpurposeidentifi complete apurchase ofordinarysharesinpursuanceanysuch contract. purchase ofordinaryshareswhich wouldormightbecompletedwhollypartlyaftertheexpiry ofsuch authorityandmay this resolutionexcept thattheCompanymayatanytimepriortoexpiry ofsuch authorityenterintoacontractforthe if earlier, ontheconclusionofCompany’snext AnnualGeneralMeeting(oradjournmentthereof)afterthepassingof ned insection724(5) oftheAct. continued c enablingprovisions initsarticlestopurchase itsownshares,to cation beadoptedastheArticlesofAssociation oftheCompanyin abling uthority icated le o buy ut o rs

Rathbone Brothers Plc 117 Notice of Annual General Meeting Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 118 Notice of Annual General Meeting a inrespectofthepaymentanyandallfi (a) 18 That: Dividend rectifi Adoption ofnewArticles ofAssociation enable thedirectorstopassaresolutionchange theCompany’sname. company isabletochange itsnamebyothermeansprovidedforarticles.To takeadvantageofthisprovision,theNewAr acompanycouldonlychange a Under theCompaniesAct1985, its name byspecialresolution.UnderCompaniesAct2006 (viii) Change ofname permitted undertheCompaniesAct2006. The NewArticles removetheprovisiongivingchairman acastingvoteintheeventofanequalityvotesasthisisnolon Chairman’scastingvote (vii) with thisrequirement.Accordingly, thispowerhasbeenremovedintheNewArticles. must beregisteredassoonpracticable.The powerintheCurrentArticlestosuspendregistrationoftransfers isincons The sharetransfer CurrentArticles permitthedirectorstosuspendregistrationoftransfers. UndertheCompaniesAct2006 Suspensionofregistrationsharetransfers (vi) taking intoaccountdayswhich arenotworkingdays.The NewArticleshavebeenamendedtorefl of memberstovoteatageneralmeetingbyreference hoursbeforethetimeofmeeting,not totheregisternotmorethan48 asamendedbytheShareholders’ RightsRegulationsthecompanymustdetermineright Under theCompaniesAct2006 Voting recorddate (v) this power. company’s articlesorbythecompanyingeneralmeeting.The NewArticlesprovidethatthedirectorsmayexercise or partoftheundertakingcompanythatsubsidiary, mayonlybeexercised bythedirectorsiftheyaresoauthorised formerly employedbythecompanyoranyofitssubsidiariesinconnectionwithcessationtransfer toanypersonofthew providesthatthepowersofdirectorsacompanytomakeprovisionforpersonemployedor The CompaniesAct 2006 Provision foremployeesoncessationofbusiness (iv) (d) any and all claims which the Company may have against its Directors (both currentandformer)either(i)inrespectofthe any and allclaimswhich theCompanymayhaveagainstitsDirectors(both (d) anydistributioninvolvedinthegivingofReleaserelationto particularRelevantDividendbemadeoutofthe (c) anyandallclaimswhich theCompanymayhaveinrespectofpaymentanyRelevantDividend againstitscurrent (b) of distributableprofi 31 December2007) (the‘RelevantDividends’),paidtocurrentandformer shareholdersoftheCompanyappropriation (otherthanthefi ending on31December2009 behalf ofthesaidDirectors. Chairman forthepurposesofidentifi Company’s DirectorsbeenteredintobytheCompanyinform ofthedeedproducedtothismeetingandsignedby out ofthepaymentanyRelevantDividendbeandtheyarehereby releasedandthatadeedofreleaseinfavourthe payment ofanyRelevantDividendor(ii)inrespectbreach ofdutyowedbysuch DirectorstotheCompanyarising the recorddateforthatRelevantDividend;and profi (the ‘Release’); be deliveredtotheSecretaryofCompanyforretentionon behalf ofthesaidcurrentandformershareholders of thedeedproducedtothismeetingandsignedbyChairmanforpurposesidentifi Dividend bereleasedandadeedofreleaseinfavoursuch shareholdersbeenteredintobytheCompanyinform and formershareholderswhoappearedontheregisterofrelevantrecorddateforeach such Relevant each such RelevantDividendwaspaid)tosuch payment,beandtheyareherebyratifi byreferencets appropriatedtosuch toarecorddateidentical RelevantDividendpursuanttoparagraph(a)above cation ts oftheCompany(asshowninauditedaccounts oftheCompanyforfi cation andthereafterbedeliveredtotheSecretaryofCompanyforretentionon continued nal andinterimdividendsbytheCompanyineach ofthe12fi nancial periods ending 31 December 2002, 31 December 2006 and nancial periodsending31December2002, December2006 ed andconfi ect thisrequirement. cation andthereafter rmed; nancial periodinwhich nancial periods nancial by the ger istent ticles hole s

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message serviceto be valid,theappropriateCREST Inorderforaproxy appointmentorinstructionmadeusingtheCREST electronicproxy members whowishtoappointaproxy appointmentservicemaydoso orproxies throughCREST CREST 3 The ‘votewithheld’optionisprovided ontheproxy cardto enable youtoabstainonanyparticularresolution.However, it Registered Offi 31 March 2010 Company secretary Richard Loader By OrderoftheBoard ordinary sharesoftheCompany)willnotbevotingonthisresolutioninviewtheirinterestsubjectmatterpr the positioninwhich theywerealwaysintendedtobe.Allofthedirectorswhoareshareholders(holdingin aggregate2.0%of the Companyforrepaymentofrelevantdividends.The purposeoftheresolutionistoputshareholdersanddirectorsint Company tothedividendpaymentconcerned;and(b)releasecurrentformershareholdersdirectorsfromanyclaimby resolution (which isproposedinfourlinkedparts)asksshareholdersto:(a)approvetheappropriation ofthehistoricprofi the relevantaccountsofCompanyforpurposesCompaniesActsdidnotshowsuffi intra-group movementsofreservesandthehistoricpaymentdividendsbyCompanysuch dividendswerepaidatatimewhen As explained intheDirectors’report on page31,followingtheidentifi Notes Dividend rectifi 2 Pursuant toRegulation41oftheUncertifi 1 should becommunicatedtothe appointeethroughothermeans. inthemanner prescribedbyCREST. AfterCREST thistime,anychange ofinstructions toproxies appointed throughCREST ApplicationsHost)fromwhich ourregistrarsare able toretrievethemessagebyenquiry to themessagebyCREST will beaccepted.For thispurpose,thetimeof receiptwillbetakentothetime(asdeterminedbytimestamp applied networkafterthistime bynolaterthan12.00 noonon3May2010.NomessagereceivedthroughtheCREST RA19) (ID the instructiongiventoapreviouslyappointedproxy must,in ordertobevalid,transmittedsoasreceivedbyEquini Manual.The message,regardlessofwhetheritconstitutestheappointment of aproxy oran amendment to in theCREST &IrelandLimited(‘Euroclear’)andmustcontain theinformationrequiredforsuch instructions,asdescribed Euroclear UK Proxy Instruction’)mustbeproperlyauthenticatedinaccordancewiththespecifi (a ‘CREST sponsor orvotingserviceprovider, whowillbeabletotaketheappropriateactionon theirbehalf. memberswhohaveappointed avotingserviceprovider, shouldrefersponsored members,andthoseCREST totheirCREST Manualwhich canbeviewedatwww.euroclear.com/CREST.described intheCREST personalmembersorotherCREST CREST for theAnnualGeneralMeetingtobeheldonWednesday 5May2010andanyadjournmentthereofbyusing theprocedures ‘for’ and‘against’aresolution. should benotedthata‘votewithheld’isnotvoteinlawandwillcountedthecalculationofproportionvot so wish. as explained below. Appointingaproxy willnotpreventyoufromattendingandvotingattheAnnualGeneralMeetingif the sametime.Memberswhoholdtheirsharesinuncertifi the detailsofappointmentcompletedinaccordancewiththoseinstructionsmustbetransmittedsoastoreceivedby appointment ofaproxy atwww.sharevote.co.uk. To beavalidproxy appointment,themember’selectronicmessage 12.00 noonon3May2010.Alternatively, amembermayappointproxy onlinebyfollowingtheinstructionsforelectronic bynolaterthan to theCompany’sRegistrars,Equiniti,atAspectHouse,SpencerRoad,Lancing,West 6ZL Sussex BN99 share orsharesheldbythatmember. Aproxy neednotbeamember. speak andvoteintheirsteadprovidedthateach proxy isappointedtoexercisetherightsattached toadifferent Members entitledtoattend,speakandvoteareentitled,iftheysowish,appointoneormoreproxies toattend, to voteatthemeeting. Subsequent changes totheentriesonregisterwillbedisregardedindeterminingrightsofanypersonattendor shall beentitledtoattendorvoteatthemeetinginrespectofnumbersharesregisteredtheirnamethattime. 3 May2010(or, ifthemeetingisadjourned,6.00pmonday twodayspriortothedayfi Company specifi ce: 159NewBondStreet,London W1S2UD es thatonlythoseshareholdersregisteredinthe registerofmemberstheCompanyasat6.00pmon cation continued cated SecuritiesRegulations2001andsubject totheprovisionsforproxies, the cated form may also use CREST toappointaproxy electronically, cated formmayalsouseCREST cation ofatechnical irregularityregardingthetimingof Proxy formsshouldbecompletedandreturned xed fortheadjournedmeeting) cations of CREST’s operator, cations ofCREST’s cient distributablereserves.This

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Rathbone Brothers Plc 119 Notice of Annual General Meeting Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 120 Notice of Annual General Meeting onthewebsite.The businesswhich maybedealtwithatthemeetingincludesanysuch statement. sections.The Companymustforwardanysuch statementtoitsauditorsbythetimeitmakesavailable auditedaccounts.The Companycannotrequirethemembersconcernedtopayitsexpenses incomplyingwiththose outanymatterthatthemembersconcernedproposetoraiseatmeetingrelating totheauditofCompany’slatest theCompanywillberequiredtopublishonawebsitestatementinaccordance with section528ofthatActsetting Itispossiblethat,pursuanttomembers’requestsmadeinaccordancewithsection527oftheCompanies Act2006, 10 topublishonawebsite Informationrelatingtothemeetingwhich theCompanyisrequiredbyCompaniesAct2006 9 Each memberattendingthemeetinghasrighttoaskquestionsrelatingbusinessbeingdealt withatthemeeting 8 Amemorandumofthetermsallcontractsservicebetweendirectorsand Company(oranyofitssubsidiaries) 7 Asat28February 2010(beingthelastpracticabledatepriortoprintingofthisNotice)Company’sissuedshare 6 The doesnotapplyto statementofrightsmembersinrelationtotheappointmentproxies inparagraphs2and3above 5 toenjoy oftheCompaniesAct2006 Anypersontowhomthisnoticeissentwhoanominatedundersection146 4 Proxy The InstructioninthecircumstancessetoutRegulation35(5)(a)of CompanymaytreatasinvalidaCREST sponsorsorvotingserviceprovidersshouldnotethatEuroclear membersand,whereapplicable,theirCREST CREST Note 3 Notes the Companyforanypurposeinrelationtomeetingotherthanasexpressly statedinit. provided bytheCompanyinthisdocumentorwithanyproxy appointmentformorinanywebsiteforcommunicatingwith in advanceofthemeetingmaybeviewedatwww.rathbones.com. Amembermaynotuseanyelectronicaddress cause tobeanswered. which, andsubjecttosomeexceptions, inaccordancewithsection319AoftheCompaniesAct2006 theCompanymust for atleast15minutespriortothemeeting,andduringmeeting. (public holidaysexcluded) from31March 2010tothedateofmeeting,andatplaceAnnual GeneralMeeting proposed byresolution17willbeavailableforinspectionattheRegisteredOffi and acopyoftheexisting MemorandumandArticlesofAssociationtheCompanymarkedtoshowchanges being to themeetingandduringmeeting.Inaddition,acopyofproposednewArticlesAssociationCompany memorandum willalsobeavailableforinspectionattheplaceofAnnualGeneralMeetingleast15minutesprior is availableforinspectionattheRegisteredOffi 28 February 2010are43,296,330. ordinaryshares,carryingonevoteeach. Therefore,capital consistsof43,296,330 thetotalvotingrightsinCompanyasat Nominated Persons. The rightsdescribedintheseparagraphscanonlybeexercised byshareholdersoftheCompany. such agreement,havearighttogive instructionstotheshareholderasexercise ofvotingrights. Meeting. IfaNominatedPerson hasnosuch proxy appointmentrightordoesnotwishtoexercise it,he/shemay, underany she wasnominated,havearighttobeappointed(orsomeoneelseappointed)asproxy fortheAnnualGeneral information rights(a‘NominatedPerson’) may, underanagreementbetweenhim/herandtheshareholderbywhomhe/ Uncertifi systemandtimings. Manualconcerningpracticallimitations oftheCREST sections oftheCREST sponsorsorvotingserviceprovidersarereferred, inparticular,members and,whereapplicable,theirCREST tothose systembyanyparticulartime.Inthisconnection,CREST to ensurethatamessageistransmittedbymeansoftheCREST service provider, sponsororvotingserviceprovidertake)such actionasshallbenecessary toprocurethathisCREST personalmemberorsponsoredhasappointedavoting memberisaCREST concerned totake(or, iftheCREST member Proxy Instructions.ItistheresponsibilityofCREST will thereforeapplyinrelationtotheinputofCREST foranyparticularmessages.Normalsystemtimingsandlimitations does notmakeavailablespecialproceduresinCREST continued continued cated SecuritiesRegulations2001. ce duringbusinesshoursonanyweekday(public holidaysexcluded). The ce duringbusinesshoursonanyweekday Five yearrecord disclosed for2007 includetheresultsofoperationsthatwerediscontinuedin2009. The amounts and2009. includetheresultsofoperationsthatwerediscountedin2008 The amountsdisclosed for2004to2006 Basic earningspershare Total fundsundermanagement Equity shareholders’funds Profi Tax Exceptional items Operating profi Equity dividendspaidandproposed Operating income Diluted earningspershare Net dividendsperordinaryshare Profi t aftertax t beforetax t £13.10bn 182,489 116,757 46.85p 29,468 32,446 46.87p 18,159 20,197 (9,271) (2,978) 42.0p £’000 2009 1.6n£31b 1.4n£9.48bn £12.24bn £13.12bn £10.46bn 3,6 3,8 3,8 113,185 133,686 134,480 131,166 8,3 8,5 5,4 130,417 159,149 184,750 184,631 1,2)(422 1,8)(10,617) (12,582) (14,212) (13,421) 2364,0 47035,298 44,720 47,302 42,306 8853,9 21824,681 32,138 33,090 28,885 5004,0 47036,679 44,720 47,302 45,020 7941,7 47612,351 14,786 17,479 17,984 70p7.4 47p58.84p 74.71p 76.54p 67.02p 75p7.9 66p60.13p 76.62p 77.79p 67.57p 274 (1,381) – – (2,714) 20 10 50 30.0p 35.0p 41.0p 42.0p £’000 2008 £’000 2007 £’000 2006 £’000 2005

Rathbone Brothers Plc 121 Five year record Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 122 Corporate information www.equiniti.com 6DA BN99 West Sussex Lancing Spencer Road Aspect House Equiniti [email protected] www.rathbones.com Company No.1000403 London W1S2UD 159 NewBondStreet BrothersPlc Rathbone R ELoader FCA Companysecretaryandregisteredoffi Corporate information Registrars andtransferoffi ce ce 1 Northgate Fax +44(0)1223307 500 Tel +44(0)1223345370 1 Temple Row Temple Point Fax +44(0)1224 218181 Tel +44(0)1224218180 AB25 1XX Aberdeen London 159 NewBondStreet Rathbone InvestmentManagementLimited InvestmentManagementoffi London 159 NewBondStreet Head offi Our offi Fax +44 (0)1539 561367 Fax +44(0)1539 Tel 561457 +44(0)1539 Cumbria LA80PB Kendal Exeter Gardens Southernhay The Senate Fax +44(0)131247 8200 Tel +44(0)131247 8100 Edinburgh CharlotteStreet 2 South Charlotte House Fax +44(0)1243776 103 Tel +44(0)1243775 373 West Sussex PO191AT Chichester Cambridge Bateman Street West Wing, Freemasons Hall Fax +44(0)1179291939 Tel +44(0)1179291919 4NT BS1 Bristol Birmingham Levens Hall The Stables 201001 Fax +44(0)1392 Tel 201 000 +44(0)1392 10 QueenSquare 7966Fax +44(0)121236 Tel +44(0)1212332626 1 AlbertStreet Fax +44(0)207399 0011 Tel +44(0)207399 0000 Fax +44(0)207399 0011 Tel +44(0)207399 0000 EX1 1UG EX1 W1S2UD W1S 2UD EH2 4AW EH2 CB2 1NA CB2 ces ce B25LG ces Fax +44(0)1512437001 Tel +44(0)151236 Pier Head Port ofLiverpoolBuilding Fax +44(0)207399 0011 Tel +44(0)207399 0000 159 NewBondStreet Rathbone UnitTrust ManagementLimited UnitTrust offi Jersey St Helier House,15Esplanade Rathbone Rathbone InvestmentManagement(C.I.)Limited 857Fax +44(0)1962 001 Tel 857 +44(0)1962 000 9EH Hampshire SO23 Winchester Liverpool Pier Head Port ofLiverpoolBuilding Liverpool London 159 NewBondStreet Rathbone Trust CompanyLimited Trust andTax offi London 32 Southgate Street 32 Southgate Fiennes House Fax +44(0)151 243 7001 Tel +44(0)151236 Fax +44(0)1534 740599 Tel +44(0)1534740500 Channel Islands Fax +44(0)207399 0057 Tel +44(0)207399 0399 JE1 2RB JE1 W1S2UD W1S 2UD L31NW L3 1NW ce 6666 6666 ces

Rathbone Brothers Plc 123 Our offi ces Report and accounts 2009 Rathbone Brothers Plc Report and accounts 2009 124 Paper specifi cations Designed andproduced byLinnettWebb Jenkins. certifi environmentally sustainable.The paperisFSC in theproductionofthisdocument are It isimportanttousthatallmaterials used recycle it. Once youhave fi 50% virginfi ed andcontains 50%recycledfi bre fromsustainable sources. nished withthisreportplease bre and bre

Rathbone Brothers Plc 159 New Bond Street London W1S 2UD Tel +44 (0)20 7399 0000 Fax +44 (0)20 7399 0011 www.rathbones.com