T. Rowe Price Group, Inc. · NASDAQ:TROW

T. Rowe Price — Shareholder Meeting (April 2017)

21 slides from T. Rowe Price's shareholder meeting presentation, April 2017

1. Slide 1: T. Rowe Price Group Update – Annual Meeting

   T. Rowe Price Group Update ANNUAL MEETING Bill Stromberg, President and CEO April 2017

2. Slide 2: Forward-Looking Information Statements

   Forward-Looking Information Statements This presentation, and other statements that T. Rowe Price may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to T. Rowe Price’s future financial or business performance, strategies,

3. Slide 3: Our Values Support Our Vision: To Be a Premier Global Asset Management Firm

   Our Values Support Our Vision: To Be a Premier Global Asset Management Firm ENDURING VALUES  Act With Integrity  Put Clients First  Pursue Excellence With Passion and Humility  Embrace Collaboration and Diversity  Be Disciplined and Risk Aware IF YOU TAKE CARE OF YOUR CLIENTS, YOUR CLIENTS WILL

4. Slide 4: The Firm Has Enjoyed Financial Success Since Our 1986 IPO

   The Firm Has Enjoyed Financial Success Since Our 1986 IPO Annualized Growth Rates Since IPO 13% Assets Under 14% 16% Net Operating Management Revenue Income 17% 23% Diluted Dividends 19% Total Stock Earnings per per Share** Return Share* *U.S. GAAP **Split adjusted Numbers through December 31, 2016.

5. Slide 5: Many Factors Have Contributed to This Healthy Growth

   Many Factors Have Contributed to This Healthy Growth Consistently Strong Mutual Fund Defined Contribution Investment Industry Growth Evolution Performance New Intermediary Early Entrant Our Unique Distribution Practices Into Retirement Culture Date Funds 5

6. Slide 6: U.S. Domiciled Mutual Fund Investment Performance

   U.S. Domiciled Mutual Fund Investment Performance Excellent Long-Term Results vs. Competitors As of March 31, 2017 % BY LIPPER QUARTILES % OF FUNDS BY MORNINGSTAR CATEGORY 50% Quartile 1 Year 3 Years 5 Years 10 Years 15 Years T. Rowe Price 40% 1st 36% 55% 58% 60% 50% Industry 30% 2nd 32% 26% 23% 29%

7. Slide 7: Culture Is Central to Our Long-Term Success

   Culture Is Central to Our Long-Term Success Performance-Driven and Collaborative Investment Excellence  The heart of everything we do Clients First  We succeed if our clients succeed Collegiality and  Leveraging our best ideas creates competitive advantage Collaboration Trust and Mutual Respect 

8. Slide 8: In Recent Years, New Realities Have Emerged

   In Recent Years, New Realities Have Emerged And the Marketplace Is Evolving Quickly Aging Investors Clients Millennials Seeking Lower-Risk Demanding New Regulatory Change Reshaping Digital Income-Oriented Vehicles and Pricing Accelerating Technology Solutions Structures Passive and Alternative Inves

9. Slide 9: Passive Net Flows Grow While Active Net Flows Shrink

   Passive Net Flows Grow While Active Net Flows Shrink Net Flows to Funds (Worldwide) 700 Active Passive 620 600 571 532 518 500 480 411 400 369 $ Billions 330 300 200 178 100 36 - 2012 2013 2014 2015 2016 Note: Includes mutual funds and ETFs for U.S. and globally, including local (e.g., OEICs) and cr

10. Slide 10: TRP Organic Growth Also Much Harder to Achieve in Recent Years

    TRP Organic Growth Also Much Harder to Achieve in Recent Years Headwinds From Growth in Passive, Alternatives, and Capacity Constraints As of December 31, 2016 % of prior year’s AUM 15% 10% 5% 0% -5% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Actual Flows ($B) 33.8 17.1 22.7 30.3 14.1 17.2 (1

11. Slide 11: In 2016, We Began Executing on a Longer-Term Strategic Plan

    In 2016, We Began Executing on a Longer-Term Strategic Plan to:  Maintain our position as a premier active asset manager  Build into a more globally diversified asset manager  Become more of an integrated investment solutions provider  Be recognized as a global partner for retirement-oriented in

12. Slide 12: Significant Investments in Products, Distribution, and Technology

    Significant Investments in Products, Distribution, and Technology Goal Is to Grow and Diversify While Seeking Increased Efficiency Products Distribution Technology  Solutions beyond  Financial advisors  Client experience target date portfolios and digital  International transformation  High-per

13. Slide 13: Some Early Successes From Our Strategic Initiatives

    Some Early Successes From Our Strategic Initiatives  New Products and Vehicles − T. Rowe Price ActivePlus Portfolios − Retail Separately Managed Accounts and Model Portfolios  Acquisition of the Henderson High Yield Opportunities Fund and Team  Agreement With Schwab to Distribute Our Funds NTF (n

14. Slide 14: 2016 Revenues and Earnings Reflect Modest Market Returns

    2016 Revenues and Earnings Reflect Modest Market Returns 2017 Off to a Solid Start, Led by Strong Market Returns As of December 31, 2016 As of March 31, 2017 2015 2016 Change 1Q16 1Q17 Change Net Revenues (M) $4,201 $4,223 1% $994 $1,114 12% Adjusted Earnings per Share* $4.39 $4.49 2% $1.01 $1.18 17

15. Slide 15: Balance Sheet Remains Strong

    Balance Sheet Remains Strong A Position of Strength in Good Times and Bad Balance Sheet Items 2006 2011 2016* 1Q17* (At 12/31 unless noted, $m) Cash and Discretionary $1,156 $1,451 $1,906 $2,166 Investments Seed Capital Investments $172 $216 $1,264 $1,344 Long-Term Debt $0 $0 $0 $0 Stockholders’ Equ

16. Slide 16: We Continued to Return Capital to Stockholders

    We Continued to Return Capital to Stockholders As of December 31, 2016 1 Year 5 Years (millions) (millions) Dividends $541 $3,063* Share Repurchases 677 2,230 Total $1,218 $5,293 Percent of Earnings 100% 95% *25.5% were Special Dividends 16

17. Slide 17: We Will Continue to Invest in Our Communities

    We Will Continue to Invest in Our Communities Investing for the Long Term Established in 1981, the T. Rowe Price Foundation continues to be a meaningful grant-making organization.  Funding from T. Rowe Price Group since inception—$125 million.  Total Foundation grants since inception—$101 million.

18. Slide 18: What You Can Expect From Us

    What You Can Expect From Us We Will Strive to:  Remain a high-integrity, client-focused firm  Provide excellent investment performance and client service  Stay true to our core values  Maintain a strong financial position  Consistently reinvest to strengthen and broaden our capabilities  Deliv

19. Slide 19: Lipper and Morningstar Copyright Notices

    Copyright 2017 © Thomson Reuters. All rights reserved. Any copying, republication or redistribution of Lipper content is expressly prohibited without the prior written consent of Lipper. Lipper shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

20. Slide 20: Thank You

    T.Rowe Price” INVEST WITH CONFIDENCE THANK YOU casiLwvsu

21. Slide 21: Reconciliation Between GAAP and Adjusted (Non-GAAP) EPS

    Reconciliation Between GAAP and Adjusted (Non-GAAP) EPS 2015 2016 1Q16 1Q17 Diluted Earnings per Common Share, GAAP Basis $4.63 $4.75 $1.18 $1.54 Non-GAAP Adjustments: Consolidated Sponsored Investment Portfolios (0.01) (0.16) (0.03) (0.08) Non-operating Income, Excluding Impact of (0.23) (0.25) (0.

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