Ifg Regulatory News (IFP)

IFG Group plc - Interim Management Statement

14 November 2012

Highlights:

·; James Hay Partnership records 258 new SIPPs in October, exceeding 250 monthly target

·; Total number of SIPPs under administration of 37,410 at end October 2012

·; Saunderson House well-positioned for RDR and winning new clients

·; Proposed £30m (€37.3m) return of capital to shareholders by way of Tender Offer

·; Strong and flexible balance sheet, net cash position expected by year end

IFG Group plc, the leading provider of bespoke SIPPs (self-invested personal pensions) and un-conflicted and fee based Financial Advice in the UK and Ireland issues the following update covering its business year to date. 

Group Performance

Group performance is on track and our core businesses are performing well despite challenging economic conditions.

The sale of the International division was completed in July 2012 and proceeds of £70m were received. The Board concluded, following consultation with its advisers, that the reduction of bank debt and the return of £30m (€37.3m) capital by way of a Tender Offer is in the best interests of the Group and Shareholders.

With a deleveraged balance sheet and a net cash position expected by year end, the Group is in a strong financial position with capacity to expand our SIPP and advisory businesses.

Divisional Update

UK

Our two principal businesses, namely James Hay Partnership (Pensions Administration) and Saunderson House (Independent Financial Advisory) continue to make progress.

Pensions Administration

James Hay Partnership administers over 40,000 self-directed pension schemes in SIPPs, SSAS' (small self administered schemes) and Wraps with circa £12bn assets under administration.

At the time of the acquisition of James Hay (March 2010), we set ourselves a number of principal tasks and targets, against which we have made significant progress:

These include:

·; IT - extraction from Santander - completed within six months' timeframe with minimal disruption.

·; Cost base restructuring - completed within nine months, three months ahead of target.

·; Re-engineered business model - introduced team-based structure with dedicated client point of contact which has resulted in improved customer satisfaction, service delivery and operating efficiency.

·; Sales, Marketing and Distribution - new products launched last year with further expansion of the product range planned along with a widening of our distribution network.

·; Attrition - our business plan included an attrition rate of 10% which is predominantly (70%) driven by the maturity of the James Hay book. Since acquisition and including the current year to date, attrition on the legacy James Hay book has been at or below this planned 10%.

Specifically, in rebuilding the business, we set a new business target of 4,000 SIPPs over a five year period. However, in the interim, we targeted a cross-over run-rate point (i.e. when new business exceeds the natural attrition on an annualised basis) by Q3 of this year. In new business terms, this converted into 250 SIPPs per month or 3,000 SIPPs on an annualised basis.

We are happy to confirm that this target was reached in October when 258 new SIPPs were gained. This follows a monthly average of 213 in Q3 2012 and has grown from an average of 148 in Q4 2011.

Through a combination of the above new business and attrition levels, the total number of SIPPs under administration was 37,410 at end October.

We are pleased with the clear progress being made in James Hay Partnership in terms of new business, product development and customer service. These achievements have been recognised by the industry, with James Hay Partnership being awarded the 'Moneyfacts Best SIPP Provider' award as voted by financial advisers.

However, we believe the potential for James Hay Partnership is considerable. Our recent work conducted on the market including its structure, new business flows and likely evolution in a post-RDR world gives us reason to be confident of the opportunities for growth.

Independent Financial Advisory

Saunderson House continues to perform well. The Retail Distribution Review will come into effect on 1 January 2013 bringing greater transparency to the industry. We welcome its introduction and expect minimal impact on Saunderson House or its clients. As a pure-fee based advisor, the business is well-positioned with continued focus on its long term proposition of conflict-free advice and excellent client service.

Under the direction of Tony Overy, the team-based model of Saunderson House continues to attract new clients and the business has won 85 new clients so far this year. Generating revenue on a time-charge basis, Saunderson House targets recovery rates of billable hours of greater than 80%. This has been achieved year to date.

Ireland

Market conditions remain difficult in Ireland as the economy remains depressed. However, we are encouraged by the new client wins within our Corporate Pensions business and the extension of our Individual Advisory offering.

The challenges in the General Broking business remain and our focus continues to be on achieving neutral contribution.

Financial Management

On 5 November we announced a proposed Tender Offer to return £30m (€37.3m) capital to shareholders. The proposal followed a review of the Group's current financial position, on-going cashflow generation, optimal capital structure and acquisition/investment opportunities. The decisions to pay down bank debt and propose a return of capital to shareholders are evidence of the strength of the business and our confidence for the future.

We will continue to invest in our core Advisory and Administration businesses and are well-positioned for growth given our financial strength and flexibility, proven management team and recognised brands.

The full details of the proposed Tender Offer and the expected timetable of Principal Events can be found in our announcement dated 5 November 2012.

Analyst and Investor Seminar

The management of IFG Group plc will host an analyst and investor seminar on 29 November in London. Those wishing to attend are asked to contact niamh.hore@ifg.ie or FTI Consulting (details below).

Ends.

For furtherinformation please contact:

Mark Bourke Niamh Hore

Chief Executive Investor Relations Manager

IFG Group plc IFG Group plc

Tel +353 1 275 2800 Tel: +353 1 275 2866

Media enquiries:

FTI Consulting

Ed Gascoigne-Pees / Laura Ewart

Tel: +44 (0)20 7269 7132 / 7243

ed.gascoigne.pees@fticonsulting.com/ laura.ewart@fticonsulting.com

IFG Group plc

Booterstown Hall

Booterstown

Co Dublin

www.ifggroup.com