compensation resulting from the extremely challenging 2008 financial and economic environment. The committee’s assessment of the placement of the named executive officer’s compensation relative to market range considers the scope, complexity and responsibility of the Ameriprise Financial executive position in relation to positions in the sources of data. The committee exercised its judgment in interpreting the market ranges and trends provided by McLagan. A named executive officer’s actual positioning relative to that market range is a result of the committee’s assessment of the Company, business, and individual performance factors we describe below.

Our peer group. Ameriprise Financial’s unique mix of business segments includes: ; advice and ; and and annuities. In order to determine an appropriate peer group, we have selected firms representative of the diversity of our business mix. When selecting a peer group, the committee, with McLagan’s advice and guidance, analyzes a potential peer’s business focus (primary and secondary), whether we compete with that firm directly for executive talent, the scale and scope of the firm’s business, and the comparability of financial results. In order to confirm that a potential peer is appropriate, the committee analyzes such financial metrics as assets, revenues, net income, market capitalization, and number of employees. It has been our intention to have Ameriprise Financial fall in the center of the range of these various measures.

Due to Ameriprise Financial’s uniqueness, there is no single company that is exactly comparable to us in every respect. Therefore, we look at the public firms included below as a benchmark for executive pay and firm-wide performance. In order to fairly measure market pay for other positions in the organization, the committee examines a broader group of financial firms, including securities firms, banks, asset management firms and insurance companies.

Asset Management Advice and Wealth Management Insurance & Annuities Affiliated Managers Group Morgan Stanley Hartford Financial Services Group AllianceBernstein Holdings L.P. Raymond James Financial Lincoln National Corp BlackRock, Inc. Schwab (Charles) Corp MetLife Eaton Vance Principal Financial Group Inc. Franklin Resources Prudential Financial Invesco Ltd. Janus Capital Group Legg Mason

Since last year, two of our peers were taken private (Nationwide Financial Services and Investments) and two firms were acquired (Bear Stearns Companies and Merrill Lynch). The committee added Inc. in the beginning of 2008 but will not include it going forward as a result of its bankruptcy protection filing. The committee also added Invesco Ltd. to the peer group in 2008.

Because no single company included in the peer group is exactly comparable to Ameriprise Financial, the committee uses the peer group solely to validate the range of competitive pay for the business segments we compete in for executive talent. With McLagan’s help, the committee will regularly review the composition of the peer group and may make changes in response to such factors as changes in the mix of a peer company’s business segments or major changes in the capital structure or business makeup of a peer company. The committee may also consider broad industry trends and data (in addition to this peer group) when making compensation decisions.

Performance assessment. At the beginning of each year the Board approves performance measures and objectives for the Company. Our approves the performance measures and objectives for each named executive officer. The committee completes the final annual performance assessment for our chief executive officer and reviews with the chief executive officer his assessment of each named executive officer during January of the following year. The committee considers many different factors in assessing the performance of each named executive officer, as we describe below. The committee does not use a rigid set of rules for determining the relative importance of these factors. The committee may emphasize or weight performance factors differently for each named executive officer.

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