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National Plans Council Update

National Plans Council Update. Cynthia Egan, President, T. Rowe Price Retirement Plan Services, Inc. Jamey Delaplane, partner, Davis & Harman, LLP. T. Rowe Price Business Update.

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National Plans Council Update

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  1. National Plans Council Update Cynthia Egan, President, T. Rowe Price Retirement Plan Services, Inc. Jamey Delaplane, partner, Davis & Harman, LLP Proprietary and Confidential

  2. T. Rowe Price Business Update • T. Rowe Price has a strong balance sheet, NO DEBT with substantial liquidity, including case and mutual fund investment holdings of $1.1 billion* • AUM down one-third from their peak of $400 billion at the start of 2008 to $268.8 billion* • Focused on one business • We’re still reinvesting in the future of the company • Retirement Plan Services Update • Participants remain steady • Deferrals remain above 7% • < 4% are making changes (loans, deferrals, balance exchange, contribution allocation) • Company match changes about 7%, most are temporary *as of 3/31/2009

  3. Managing Costs at T. Rowe Price • Workforce reduction • 5.5% or 288 associates • 76 associates in RPS/RPS Ops • Philosophic approach • Through attrition, retirements, and the workforce reduction, total staffing is now down 8.6% from the beginning of the year. • Total expense savings could reduce 2009 operating expenses by as much as $120 million from the 2007 level of spending. • Advertising and promotion 25% lower than 2008 • Consulting and professional fees, travel and related costs and other third party services down 25% from Q1 2008 • Deferring hiring • Deferring occupation of new buildings • WorkSmart Initiative • Partnering with clients on electronic delivery

  4. The Focus in Washington Key Players • Centers of Power in Democratic Washington • President Obama • House Speaker Pelosi and Key Committee Chairmen Lieutenants • Senate Moderates of Both Parties • Key Obama Administration Retirement Policy Players • Department of Treasury: Mark Iwry, Deputy Assistant Secretary for Tax Policy – Health and Retirement Policy • Department of Labor: Phyllis Borzi, Assistant Secretary for Employee Benefits Security Administration • House Retirement Policy Players • Chairman Miller (D-CA) of House Education & Labor Committee is Dominant Force • Watch Rep. Richard Neal (D-MA) of House Ways & Means Committee • House Republicans Have Little Ability to Influence Agenda • Senate Retirement Policy Players • Chairman Baucus (D-MT) of Senate Finance and Chairman Kennedy (D-MA) of Senate HELP • Senior Committee Republicans Also Important – Grassley (Ginance) and Enzi (HELP)

  5. The Focus in Washington Hot Topics • Fee Transparency • Target Date Funds • Expanding Retirement Savings Coverage • Promoting Lifetime Income/Annuitization • Other Topics • Tax Incentives for Retirement Savings • Investment Advice • Nonqualified Deferred Compensation

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