Federated Investors (FII)

Federated Investors, Inc. Reports Fourth Quarter and Year-End 2006 Earnings

(PITTSBURGH, Pa., January 25, 2007) — Federated Investors, Inc. (NYSE: FII), one of the nation’s largest investment managers, today reported earnings per diluted share from continuing operations (EPS) of $0.51 for the quarter ended Dec. 31, 2006, compared to $0.47 for Q4 2005. For the year ended Dec. 31, 2006, Federated reported EPS of $1.80 compared to $1.49 for 2005.

Federated’s income from continuing operations was $53.1 million for Q4 2006 compared to $51.4 million for Q4 2005. For the year ended Dec. 31, 2006, income from continuing operations was $191.0 million compared to $161.0 million for 2005.

Federated’s total managed assets reached a record $237.4 billion at Dec. 31, 2006, up $24.0 billion or 11 percent from $213.4 billion at Dec. 31, 2005 and up $14.7 billion or 7 percent from $222.7 billion at Sept. 30, 2006. Through its mutual funds and separate accounts, Federated managed a record $63.8 billion in equity and fixed-income assets as of Dec. 31, 2006, an $11.0 billion or 21 percent increase from $52.8 billion as of Dec. 31, 2005 and a $3.9 billion or 7 percent increase from $59.9 billion as of Sept. 30, 2006. Average managed assets for Q4 2006 were $231.7 billion, up $21.6 billion or 10 percent from $210.1 billion reported for Q4 2005 and up $12.0 billion or 5 percent from $219.7 billion reported for Q3 2006.

“Catalysts for Federated’s equity asset growth during 2006 included strong equity market conditions in the second half of the year, the acquisition of MDTA LLC (MDT) and improved performance in some of our key equity products,” said President and CEO J. Christopher Donahue. “Additionally, as money market yields increased over the course of the year, Federated continued to see growth in its money market assets as demand increased among broker/dealers and trust clients.”

The company also announced that its board of directors declared a quarterly dividend of $0.18 per share. The dividend is payable on Feb. 15, 2007 to shareholders of record as of Feb. 8, 2007. During Q4 2006, Federated purchased 1,348,500 shares of Federated class B common stock for $45.0 million. For 2006, the company purchased 5,236,344 shares for $168.9 million.

Federated Reports Q4 and Year-End 2006 Earnings

Jan. 25, 2007

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Federated’s equity assets were a record $40.9 billion at Dec. 31, 2006, up $11.1 billion or 37 percent from $29.8 billion at Dec. 31, 2005 and up $2.6 billion or 7 percent from $38.3 billion at Sept. 30, 2006. Federated’s top selling equity mutual funds on a net basis were: Federated Strategic Value Fund, Federated Kaufmann Small Cap Fund, Federated Muni and Stock Advantage Fund and Federated MDT All Cap Core Fund. Federated saw solid organic growth in its equity separate account products, which had $154 million in net sales during Q4 2006.

Federated’s fixed-income assets were $22.9 billion at Dec. 31, 2006, down slightly from $23.0 billion at Dec. 31, 2005 and up $1.2 billion or 6 percent from $21.7 billion at Sept. 30, 2006. Federated’s top selling fixed-income mutual funds on a net basis were: Federated Total Return Bond Fund, Federated Total Return Government Bond Fund, Federated Ultrashort Bond Fund and Federated Institutional High Yield Bond Fund.

Money market assets were $173.6 billion at Dec. 31, 2006, up $13.0 billion or 8 percent from $160.6 billion at Dec. 31, 2005 and up $10.8 billion or 7 percent from $162.8 billion at Sept. 30, 2006. Money market mutual fund assets were $155.2 billion at the end of Q4 2006, up $9.9 billion or 7 percent from $145.3 billion at Dec. 31, 2005 and up $8.4 billion or 6 percent from $146.8 billion at Sept. 30, 2006. Average money market mutual fund assets were $152.2 billion for Q4 2006, up $8.5 billion or 6 percent from $143.7 billion for Q4 2005 and up $6.4 billion or 4 percent from $145.8 billion for Q3 2006.