| Corporate and Institutional Client Group |
| Private Client Group |
| Merrill Lynch Investment Managers |
| We're Bullish on Merrill Lynch |
MERRILL LYNCH INVESTMENT MANAGERS
Performance-Driven Asset Management
To create and conserve wealth in an increasingly complex world, institutional and private clients demand superior investment performance. The asset management organization that offers a complete range of innovative investment solutions and exceptional client service - on a global scale - will become preeminent.
DRIVING IMPROVED PERFORMANCE
With more than $550 billion of client assets entrusted to more than 900 professionals - and a presence in 22 countries - Merrill Lynch Investment Managers (MLIM) is a truly global investment management organization. We strengthened our leadership position in 2000 by focusing first and foremost on achieving outstanding investment performance - across all products and markets. Last year, despite a challenging environment, more than 69% of total assets under management achieved returns better than benchmark. This was highlighted with results that showed 79% of institutional equity assets in Europe exceeding benchmark and 81% of our U.S. retail mutual funds realizing returns above median.In addition to growing the assets already entrusted to us, our performance in 2000 enhanced our ability to attract new assets. New mandates reached a record $130 billion worldwide. Net new money totaled $33 billion - representing an increase of nearly 400% from 1999 and placing us among the leaders of our industry.
CAPTURING THE POWER OF MERRILL LYNCH
We are particularly pleased that our improving financial results have created significant value for Merrill Lynch and its shareholders. Because our asset management business is characterized by earnings stability and low capital requirements, it occupies a valuable place in our firm's financial structure.Similarly, being part of Merrill Lynch provides us with powerful resources to attract new investors to MLIM's products and services. Chief among them is the Merrill Lynch brand, under which we united all of our asset management activities worldwide in 2000. Our new name, Merrill Lynch Investment Managers, reflects our ability to inspire confidence in our clients through a comprehensive array of best-in-class products, superior performance and excellent client service.
As one global organization, we broadened our product array in 2000 to meet the demands of clients worldwide. Our U.S. mutual funds group added new capabilities in the growth style of investing, to complement longstanding expertise in the value-oriented approach. Globally, we increased our discretionary offerings and created a new alternative investments group to offer hedge funds, quantitative funds and private equity investments to clients with more sophisticated financial needs.
MAXIMIZING DISTRIBUTION CHANNELS
Finally, becoming a more identifiable part of Merrill Lynch maximizes the effectiveness of our distribution channels. In addition to our traditional relationships with the U.S. and International Private Client groups, we are also working with our colleagues in the Corporate and Institutional Client Group to provide investment management solutions for their clients. This collaboration produced $28 billion in new mandates for MLIM in 2000.While we seek to increase our market share within the critical proprietary sales channels, we are successfully complementing this effort by distributing our products through other financial intermediaries. This worldwide initiative has achieved particularly notable success in Europe and in the U.S. - where sales through banks and insurance companies multiplied sevenfold.
We believe that the positive momentum we established in 2000 will propel us on our path toward preeminence, helping us capture new opportunities for growth and profitability in the years ahead.
