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RJF Raymond James Financial

Filed: 27 Jan 21, 4:36pm

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EARNINGS RELEASE FINANCIAL SUPPLEMENT


FIRST QUARTER
OF FISCAL 2021 RESULTS











RAYMOND JAMES FINANCIAL, INC.             
Consolidated Statements of Income (Unaudited)

Three months ended% change from
in millions, except per share amountsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Asset management and related administrative fees$955 $1,006 $867 $1,006 $1,067 12 %%
Brokerage revenues:
Securities commissions363 410 343 352 381 %%
Principal transactions97 105 143 143 147 52 %%
Total brokerage revenues460 515 486 495 528 15 %%
Account and service fees178 172 134 140 145 (19)%%
Investment banking141 148 139 222 261 85 %18 %
Interest income297 285 217 201 203 (32)%%
Other (1)
29 (15)33 57 56 93 %(2)%
Total revenues2,060 2,111 1,876 2,121 2,260 10 %%
Interest expense(51)(43)(42)(42)(38)(25)%(10)%
Net revenues2,009 2,068 1,834 2,079 2,222 11 %%
Non-interest expenses:
Compensation, commissions and benefits1,351 1,422 1,277 1,415 1,500 11 %%
Non-compensation expenses:
Communications and information processing94 99 100 100 99 %(1)%
Occupancy and equipment57 56 55 57 57 — — 
Business development44 41 21 28 23 (48)%(18)%
Investment sub-advisory fees26 26 23 26 28 %%
Professional fees21 23 24 23 30 43 %30 %
Bank loan provision/(benefit) for credit losses (2)
(2)109 81 45 14 NM(69)%
Acquisition and disposition-related expenses (3)
— — — 2 NM(71)%
Reduction in workforce expenses (4)
— — — 46  — (100)%
Other (1)
59 53 55 76 70 19 %(8)%
Total non-compensation expenses299 407 359 408 323 %(21)%
Total non-interest expenses1,650 1,829 1,636 1,823 1,823 10 %— 
Pre-tax income359 239 198 256 399 11 %56 %
Provision for income taxes91 70 26 47 87 (4)%85 %
Net income$268 $169 $172 $209 $312 16 %49 %
Earnings per common share – basic (5)
$1.93 $1.22 $1.25 $1.53 $2.27 18 %48 %
Earnings per common share – diluted (5)
$1.89 $1.20 $1.23 $1.50 $2.23 18 %49 %
Weighted-average common shares outstanding – basic138.3 138.4 137.1 136.9 136.8 (1)%— 
Weighted-average common and common equivalent shares outstanding – diluted141.5 141.1 139.4 139.6 139.7 (1)%— 
Please refer to the footnotes at the end of this supplement for additional information.
2

RAYMOND JAMES FINANCIAL, INC.             
Consolidated Selected Key Metrics (Unaudited)

As of% change from
$ in millions, except per share amountsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Total assets$40,154 $49,809 $44,682 $47,482 $53,657 34 %13 %
Total equity attributable to Raymond James Financial, Inc.$6,842 $6,798 $6,965 $7,114 $7,363 %%
Book value per share (6)
$49.26 $49.69 $50.84 $52.08 $53.59 %%
Tangible book value per share (6) (7)
$45.10 $45.50 $46.69 $47.94 $47.93 %— 
Capital ratios:
Tier 1 capital24.8 %24.1 %24.8 %24.2 %23.4 %(8)
Total capital25.7 %25.3 %26.0 %25.4 %24.6 %(8)
Tier 1 leverage15.8 %14.2 %14.5 %14.2 %12.9 %(8)


Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Adjusted pre-tax income (7)
NANANA$309 $401 12 %30 %
Adjusted net income (7)
NANANA$249 $314 17 %26 %
Adjusted earnings per common share - basic (5) (7)
NANANA$1.82 $2.29 19 %26 %
Adjusted earnings per common share - diluted (5) (7)
NANANA$1.78 $2.24 19 %26 %
Return on equity (9)
16.0 %9.9 %10.0 %11.9 %17.2 %
Adjusted return on equity (7) (9)
NANANA14.1 %17.3 %
Return on tangible common equity (7) (9)
17.5 %10.8 %10.9 %12.9 %19.0 %
Adjusted return on tangible common equity (7) (9)
NANANA15.3 %19.1 %
Pre-tax margin (10)
17.9 %11.6 %10.8 %12.3 %18.0 %
Adjusted pre-tax margin (7) (10)
NANANA14.9 %18.0 %
Total compensation ratio (11)
67.2 %68.8 %69.6 %68.1 %67.5 %
Effective tax rate25.3 %29.3 %13.1 %18.4 %21.8 %
Please refer to the footnotes at the end of this supplement for additional information.
3

RAYMOND JAMES FINANCIAL, INC.             
Consolidated Selected Key Metrics (Unaudited)

As of% change from
December 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Client asset metrics ($ in billions):
Client assets under administration$896.0 $773.9 $876.9 $930.1 $1,024.8 14 %10 %
Private Client Group assets under administration$855.2 $734.0 $833.1 $883.3 $974.2 14 %10 %
Private Client Group assets in fee-based accounts$444.2 $383.5 $443.0 $475.3 $532.7 20 %12 %
Financial assets under management$151.7 $128.2 $145.4 $153.1 $169.6 12 %11 %
Clients' domestic cash sweep balances ($ in millions):
Raymond James Bank Deposit Program (“RJBDP”): (12)
Raymond James Bank$21,891 $28,711 $24,101 $25,599 $26,697 22 %%
Third-party banks15,061 20,379 24,661 25,998 26,142 74 %%
Subtotal RJBDP36,952 49,090 48,762 51,597 52,839 43 %%
Client Interest Program2,528 3,782 3,157 3,999 8,769 247 %119 %
Total clients’ domestic cash sweep balances$39,480 $52,872 $51,919 $55,596 $61,608 56 %11 %

Three months ended
December 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
Average yield on RJBDP - third-party banks (13)
1.64 %1.33 %0.33 %0.33 %0.31 %
As of% change from
December 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Private Client Group financial advisors:
Employees3,331 3,376 3,379 3,404 3,387 %— 
Independent contractors4,729 4,772 4,776 4,835 4,846 %— 
Total advisors8,060 8,148 8,155 8,239 8,233 %— 

Please refer to the footnotes at the end of this supplement for additional information.
4

RAYMOND JAMES FINANCIAL, INC.        
Segment Results - Private Client Group (Unaudited)

Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Asset management and related administrative fees$782 $833 $715 $832 $885 13 %%
Brokerage revenues:
Mutual and other fund products144 163 131 129 148 %15 %
Insurance and annuity products101 99 88 109 98 (3)%(10)%
Equities, ETFs, and fixed income products102 122 100 95 107 %13 %
Total brokerage revenues347 384 319 333 353 %%
Account and service fees:
Mutual fund and annuity service fees90 88 82 88 94 %%
RJBDP fees: (12)
Third-party banks58 51 20 21 21 (64)%— 
Raymond James Bank47 48 43 42 43 (9)%%
Client account and other fees29 35 32 33 32 10 %(3)%
Total account and service fees224 222 177 184 190 (15)%%
Investment banking11 11 12 6 (45)%(50)%
Interest income49 45 31 30 30 (39)%— 
All other5 (44)%(29)%
Total revenues1,422 1,502 1,253 1,398 1,469 %%
Interest expense(8)(7)(4)(4)(2)(75)%(50)%
Net revenues1,414 1,495 1,249 1,394 1,467 %%
Non-interest expenses:
Financial advisor compensation and benefits857 915 783 873 931 %%
Administrative compensation and benefits247 245 235 244 249 %%
Total compensation, commissions and benefits1,104 1,160 1,018 1,117 1,180 %%
Non-compensation expenses157 165 140 152 147 (6)%(3)%
Total non-interest expenses1,261 1,325 1,158 1,269 1,327 %%
Pre-tax income$153 $170 $91 $125 $140 (8)%12 %
Please refer to the footnotes at the end of this supplement for additional information.
5

RAYMOND JAMES FINANCIAL, INC.             
Segment Results - Capital Markets (Unaudited)

Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Brokerage revenues:
Fixed income$81 $90 $125 $125 $131 62 %%
Equity34 40 41 35 42 24 %20 %
Total brokerage revenues115 130 166 160 173 50 %%
Investment banking:
Merger & acquisition and advisory60 72 60 98 149 148 %52 %
Equity underwriting39 43 35 68 60 54 %(12)%
Debt underwriting31 22 37 43 46 48 %%
Total investment banking130 137 132 209 255 96 %22 %
Interest income10 3 (63)%— 
Tax credit fund revenues18 12 20 33 16 (11)%(52)%
All other7 133 %— 
Total revenues274 296 325 412 454 66 %10 %
Interest expense(6)(6)(2)(2)(2)(67)%— 
Net revenues268 290 323 410 452 69 %10 %
Non-interest expenses:
Compensation, commissions and benefits166 184 195 229 252 52 %10 %
Non-compensation expenses (3)
73 78 66 75 71 (3)%(5)%
Total non-interest expenses239 262 261 304 323 35 %%
Pre-tax income$29 $28 $62 $106 $129 345 %22 %
Please refer to the footnotes at the end of this supplement for additional information.
6

RAYMOND JAMES FINANCIAL, INC.             
Segment Results - Asset Management (Unaudited)

Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Asset management and related administrative fees:
Managed programs$125 $124 $109 $123 $129 %%
Administration and other51 53 48 55 59 16 %%
Total asset management and related administrative fees176 177 157 178 188 %%
Account and service fees4 (20)%— 
All other3 — 50 %
Net revenues184 184 163 184 195 %%
Non-interest expenses:
Compensation, commissions and benefits45 45 44 43 45 — %
Non-compensation expenses66 66 59 63 67 %%
Total non-interest expenses111 111 103 106 112 %%
Pre-tax income$73 $73 $60 $78 $83 14 %%
Please refer to the footnotes at the end of this supplement for additional information.
7

RAYMOND JAMES FINANCIAL, INC.             
Segment Results - Raymond James Bank (Unaudited)

Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Interest income$231 $223 $181 $165 $168 (27)%%
Interest expense(21)(18)(12)(11)(11)(48)%— 
Net interest income210 205 169 154 157 (25)%%
All other10 67 %43 %
Net revenues216 210 178 161 167 (23)%%
Non-interest expenses:
Compensation and benefits12 13 13 13 12 — (8)%
Non-compensation expenses:
Bank loan provision/(benefit) for credit losses (2)
(2)109 81 45 14 NM(69)%
RJBDP fees to Private Client Group (12)
47 48 43 42 43 (9)%%
All other24 26 27 28 27 13 %(4)%
Total non-compensation expenses69 183 151 115 84 22 %(27)%
Total non-interest expenses81 196 164 128 96 19 %(25)%
Pre-tax income$135 $14 $14 $33 $71 (47)%115 %
Please refer to the footnotes at the end of this supplement for additional information.
8

RAYMOND JAMES FINANCIAL, INC.             
Segment Results - Other (14) (Unaudited)

Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Revenues:
Interest income$12 $12 $$$3 (75)%— 
Gains/(losses) on private equity investments (1)
(2)(39)12 24 NM100 %
All other— — 1 (50)%NM
Total revenues12 (27)15 28 133 %87 %
Interest expense(20)(17)(26)(25)(24)20 %(4)%
Net revenues(8)(44)(20)(10)4 NMNM
Non-interest expenses:
Compensation and all other (1)
23 30 26 13 %(13)%
Reduction in workforce expenses (4)
— — — 46  — (100)%
Acquisition-related expenses (3)
— — — — 2 NMNM
Total non-interest expenses23 76 28 22 %(63)%
Pre-tax loss$(31)$(46)$(29)$(86)$(24)23 %72 %
Please refer to the footnotes at the end of this supplement for additional information.
9

RAYMOND JAMES FINANCIAL, INC.             
Raymond James Bank Selected Key Metrics (Unaudited)


The following metrics are attributable to our banking subsidiary Raymond James Bank, N.A. which is a component of our Raymond James Bank segment.

As of% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Total assets$26,469 $33,656 $29,066 $30,610 $31,580 19 %%
Total equity$2,300 $2,263 $2,279 $2,315 $2,364 %%
Bank loans, net$21,296 $21,788 $21,223 $21,195 $21,957 %%
Bank loan allowance for credit losses (2)
$216 $324 $334 $354 $378 75 %%
Bank loan allowance for credit losses as a % of loans held for investment (2)
1.01 %1.47 %1.56 %1.65 %1.71 %
Total nonperforming assets$41 $27 $23 $32 $28 (32)%(13)%
Nonperforming assets as a % of total assets0.16 %0.08 %0.08 %0.10 %0.09 %
Total criticized loans$349 $387 $733 $933 $899 158 %(4)%
Criticized loans as a % of loans held for investment1.64 %1.76 %3.41 %4.35 %4.06 %
Capital ratios:
Tier 1 capital13.3 %12.7 %12.8 %13.0 %13.1 %(8)
Total capital14.5 %13.9 %14.1 %14.3 %14.4 %(8)
Tier 1 leverage8.8 %8.1 %7.6 %7.7 %7.5 %(8)


Three months ended% change from
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
December 31,
2019
September 30,
2020
Bank loan provision/(benefit) for credit losses (2)
$(2)$109 $81 $45 $14 NM(69)%
Net charge-offs$— $— $72 $26 $ — (100)%
Net interest margin (net yield on interest-earning assets)3.23 %3.02 %2.29 %2.09 %2.02 %
Please refer to the footnotes at the end of this supplement for additional information.
10


RAYMOND JAMES FINANCIAL, INC.     

Reconciliation of non-GAAP financial measures to GAAP financial measures (Unaudited)

We utilize certain non-GAAP financial measures as additional measures to aid in, and enhance, the understanding of our financial results and related measures. These non-GAAP financial measures have been separately identified in this document. We believe certain of these non-GAAP financial measures provides useful information to management and investors by excluding certain material items that may not be indicative of our core operating results. We utilize these non-GAAP financial measures in assessing the financial performance of the business, as they facilitate a comparison of current- and prior-period results. We believe that return on tangible common equity and tangible book value per share are meaningful to investors as they facilitate comparisons of our results to the results of other companies. In the following tables, the tax effect of non-GAAP adjustments reflects the statutory rate associated with each non-GAAP item. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP. In addition, our non-GAAP financial measures may not be comparable to similarly titled non-GAAP financial measures of other companies. The following tables provide a reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures for those periods which include non-GAAP adjustments.

Three months ended
$ in millionsSeptember 30,
2020
December 31,
2020
Net income$209 $312 
Non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
2 
Reduction in workforce expenses (4)
46  
Pre-tax impact of non-GAAP adjustments53 2 
Tax effect of non-GAAP adjustments(13) 
Total non-GAAP adjustments, net of tax40 2 
Adjusted net income$249 $314 
Pre-tax income$256 $399 
Pre-tax impact of non-GAAP adjustments (as detailed above)53 2 
Adjusted pre-tax income$309 $401 
Pre-tax margin (10)
12.3 %18.0 %
Non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
0.4 % 
Reduction in workforce expenses (4)
2.2 % 
Total non-GAAP adjustments, net of tax2.6 % 
Adjusted pre-tax margin (10)
14.9 %18.0 %







Please refer to the footnotes at the end of this supplement for additional information.
11


RAYMOND JAMES FINANCIAL, INC.     

Reconciliation of non-GAAP financial measures to GAAP financial measures (Unaudited)
(Continued from previous page)

Three months ended
Earnings per common share (5)
September 30,
2020
December 31,
2020
Basic$1.53 $2.27 
Non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
0.05 0.02 
Reduction in workforce expenses (4)
0.34  
Tax effect of non-GAAP adjustments(0.10) 
Total non-GAAP adjustments, net of tax0.29 0.02 
Adjusted basic$1.82 $2.29 
Diluted$1.50 $2.23 
Non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
0.05 0.01 
Reduction in workforce expenses (4)
0.33  
Tax effect of non-GAAP adjustments(0.10) 
Total non-GAAP adjustments, net of tax0.28 0.01 
Adjusted diluted$1.78 $2.24 



Book value per shareAs of
$ in millions, except per share amountsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
Total equity attributable to Raymond James Financial, Inc.$6,842 $6,798 $6,965 $7,114 $7,363 
Less non-GAAP adjustments:
Goodwill and identifiable intangible assets, net609 603 602 600 834 
Deferred tax liabilities, net(31)(30)(33)(34)(56)
Tangible common equity attributable to Raymond James Financial, Inc.$6,264 $6,225 $6,396 $6,548 $6,585 
Common shares outstanding138.9 136.8 137.0 136.6 137.4 
Book value per share (6)
$49.26 $49.69 $50.84 $52.08 $53.59 
Tangible book value per share (6)
$45.10 $45.50 $46.69 $47.94 $47.93 


Please refer to the footnotes at the end of this supplement for additional information.
12


RAYMOND JAMES FINANCIAL, INC.     

Reconciliation of non-GAAP financial measures to GAAP financial measures (Unaudited)
(Continued from previous page)

Return on equityThree months ended
$ in millionsDecember 31,
2019
March 31,
2020
June 30,
2020
September 30,
2020
December 31,
2020
Average equity (15)
$6,712 $6,820 $6,882 $7,040 $7,239 
Impact on average equity of non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
NANANA1 
Reduction in workforce expenses (4)
NANANA23  
Tax effect of non-GAAP adjustmentsNANANA(7) 
Adjusted average equity (15)
NANANA$7,060 $7,240 
Average equity (15)
$6,712 $6,820 $6,882 $7,040 $7,239 
Less:
Average goodwill and identifiable intangible assets, net610 606 603 601 717 
Average deferred tax liabilities, net(30)(31)(32)(33)(45)
Average tangible common equity (15)
$6,132 $6,245 $6,311 $6,472 $6,567 
Impact on average equity of non-GAAP adjustments:
Acquisition and disposition-related expenses (3)
NANANA1 
Reduction in workforce expenses (4)
NANANA23  
Tax effect of non-GAAP adjustmentsNANANA(7) 
Adjusted average tangible common equity (15)
NANANA$6,492 $6,568 
Return on equity (9)
16.0 %9.9 %10.0 %11.9 %17.2 %
Adjusted return on equity (9)
NANANA14.1 %17.3 %
Return on tangible common equity (9)
17.5 %10.8 %10.9 %12.9 %19.0 %
Adjusted return on tangible common equity (9)
NANANA15.3 %19.1 %

Please refer to the footnotes at the end of this supplement for additional information.
13


RAYMOND JAMES FINANCIAL, INC.     
Footnotes

1.Other revenues included approximately $40 million of private equity valuation losses, $12 million of private equity valuation gains, and $24 million of private equity valuation gains for the three months ended March 31, 2020, three months ended September 30, 2020 and three months ended December 31, 2020, respectively, which were included in our Other segment. Of these amounts, $23 million of the losses for the three months ended March 31, 2020, $3 million of the gains for the three months ended September 30, 2020, and $10 million of the gains for the three months ended December 31, 2020 were attributable to noncontrolling interests and were offset in Other expenses.

2.The allowance for credit losses as of December 31, 2020 was determined under the current expected credit loss (“CECL”) model as a result of our October 1, 2020 adoption of new accounting guidance related to the measurement of credit losses on financial instruments. The impact of adoption on October 1, 2020 resulted in an increase in our allowance for credit losses, including reserves for unfunded lending commitments, of approximately $45 million (primarily $25 million related to loans to financial advisors in the Private Client Group and approximately $10 million related to Bank loans outstanding) and a corresponding reduction in retained earnings of approximately $35 million, net of tax. The Bank loan provision for credit losses of $14 million for the fiscal first quarter of 2021 was determined under the CECL model and represented the provision for credit losses post the CECL adoption date through December 31, 2020.

3.The three months ended September 30, 2020 included a $7 million loss in our Capital Markets segment related to the sale of our interests in certain entities that operated predominantly in France, which closed during our fiscal first quarter of 2021. The three months ended December 31, 2020 included expenses in our Other segment associated with our acquisition of NWPS Holdings, Inc. and its wholly-owned subsidiaries, which was announced and completed in December 2020, as well as our announced acquisition of Financo.

4.Reduction in workforce expenses for the three months ended September 30, 2020 were associated with position eliminations in response to the economic environment. These expenses were included in our Other segment and primarily consisted of severance and related payroll expenses, as well as expenses related to company-paid benefits.

5.Earnings per common share is computed by dividing net income (less allocation of earnings and dividends to participating securities) by weighted-average common shares outstanding (basic or diluted as applicable) for each respective period or, in the case of adjusted earnings per common share, computed by dividing adjusted net income (less allocation of earnings and dividends to participating securities) by weighted-average common shares outstanding (basic or diluted as applicable) for each respective period.

6.Book value per share is computed by dividing total equity attributable to Raymond James Financial, Inc. by the number of common shares outstanding at the end of each respective period or, in the case of tangible book value per share, computed by dividing tangible common equity by the number of common shares outstanding at the end of each respective period. Tangible common equity is defined as total equity attributable to Raymond James Financial, Inc. less goodwill and intangible assets, net of related deferred taxes.

7.These are non-GAAP financial measures. See the schedules on the previous pages for a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP measures and for more information on these measures. There were no non-GAAP adjustments to earnings for the three months ended December 31, 2019, March 31, 2020, and June 30, 2020; therefore, percent changes for earnings-related non-GAAP financial measures are calculated based on non-GAAP results for the three months ended December 31, 2020 as compared to GAAP results for the three months ended December 31, 2019.

8.Estimated.

9.Return on equity is computed by dividing annualized net income by average equity for each respective period or, in the case of return on tangible common equity, computed by dividing annualized net income by average tangible common equity for each respective period. Adjusted return on equity is computed by dividing annualized adjusted net income by adjusted average equity for each respective period, or in the case of adjusted return on tangible common equity, computed by dividing annualized adjusted net income by adjusted average tangible common equity for each respective period.

10.Pre-tax margin is computed by dividing pre-tax income by net revenues for each respective period or, in the case of adjusted pre-tax margin, computed by dividing adjusted pre-tax income by net revenues for each respective period.

11.Total compensation ratio is computed by dividing compensation, commissions and benefits expense by net revenues for each respective period.

12.We earn fees from RJBDP, a multi-bank sweep program in which clients’ cash deposits in their brokerage accounts are swept into interest-bearing deposit accounts at Raymond James Bank and various third-party banks. Fees earned by Private Client Group on Raymond James Bank deposits are eliminated in consolidation.

13.Average yield on RJBDP - third-party banks is computed by dividing annualized RJBDP fees - third-party banks, which are net of the interest expense paid to clients by the third-party banks, by the average daily RJBDP balances at third-party banks.

14.The Other segment includes the results of our private equity investments, interest income on certain corporate cash balances, and certain corporate overhead costs of Raymond James Financial, Inc., including the interest costs on our public debt.

15.Average equity is computed by adding the total equity attributable to Raymond James Financial, Inc. as of the date indicated to the prior quarter-end total, and dividing by two, or in the case of average tangible common equity, computed by adding tangible common equity as of the date indicated to the prior quarter-end total, and dividing by two. Adjusted average equity is computed by adjusting for the impact on average equity of the non-GAAP adjustments, as applicable for each respective period. Adjusted average tangible common equity is computed by adjusting for the impact on average tangible common equity of the non-GAAP adjustments, as applicable for each respective period.

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