SEI Reports Fourth-Quarter Revenues of $268.4 million, Net Income of $9.6 million

Net income negatively affected by $64.3 million in SIV-related charges

OAKS, Pa., Jan. 29 /PRNewswire-FirstCall/ -- SEI Investments Company (Nasdaq: SEIC) today announced financial results for fourth-quarter 2008, reporting decreases in revenues, net income and earnings per share compared to fourth-quarter 2007. Net income during the fourth-quarter 2008 was negatively affected by a $64.3 million pre-tax charge (approximately $.20 per share post-tax) for previously-disclosed structured investment vehicle-related issues involving SEI-sponsored money market funds. The total SIV-related loss recognized during 2008 is $158.2 million and the total cumulative loss recognized is $183.3 million.



    Consolidated Overview   For the Three Months        For the Twelve Months
    (In thousands, except    Ended December 31,           Ended December 31,
     earnings per share)    2008       2007   %       2008        2007    %
                            ----       ----   -       ----        ----    -

    Revenues              $268,402 $353,409 (24%) $1,247,919 $1,369,028  (9%)
    Net Income Before
     Taxes                  19,477   84,792 (77%)    224,974    409,540 (45%)
    Net Income               9,649   53,632 (82%)    139,254    259,809 (46%)
    Diluted Earnings Per
     Share                    $.05     $.27 (81%)       $.71      $1.28 (45%)

"The severe downturn in the capital markets made the fourth-quarter a particularly challenging one and had a significant negative impact on both our quarterly and annual results," said Alfred P. West, Jr., SEI Chairman and CEO.

"Furthermore, the current market and economic environment promises to make 2009 challenging as well. In light of this, our current focus is on maintaining a strong capital base and balance sheet. Fortunately, we continue to produce positive cash flow which permits us to stay the course in the implementation of our strategies.

"During these times, we will work hard to improve our business and its results and to focus on our clients' well-being. We are firm in our belief that what we are doing will provide our clients with opportunities for success and position us to prosper as times get better."



    Summary of Fourth-Quarter and Year to Date Results by Business Segment

     (In thousands)  For the Three Month Period   For the Twelve Month Period
                          Ended December 31,          Ended December 31,
                          2008       2007     %      2008      2007       %
                          ----       ----     -      ----      ----       -

    Private Banks:
     Revenues            $97,962  $111,814  (12%) $408,500  $413,922     (1%)
     Expenses             75,582    89,255  (15%)  326,661   330,923     (1%)
                          ------    ------         -------   -------
    Operating Profit     $22,380   $22,559   (1%)  $81,839   $82,999     (1%)
    Operating Margin         23%       20%             20%       20%
    Investment Advisors:
     Revenues             41,951    66,564  (37%)  223,164   259,288    (14%)
     Expenses             28,529    33,392  (15%)  122,231   124,942     (2%)
                          ------    ------         -------   -------
     Operating Profit     13,422    33,172  (60%)  100,933   134,346    (25%)
     Operating Margin        32%       50%             45%       52%

    Institutional
      Investors:
     Revenues             43,408    52,778  (18%)  198,154    199,593    (1%)
     Expenses             22,873    32,031  (29%)  112,866    121,365    (7%)
                          ------    ------         -------    -------
     Operating Profit     20,535    20,747   (1%)   85,288     78,228     9%
     Operating Margin        47%       39%             43%        39%

    Investment Managers:
     Revenues             35,966    38,244   (6%)  147,968    143,375     3%
     Expenses             23,536    26,752  (12%)  101,078    101,401     --
                          ------    ------         -------    -------
     Operating Profit     12,430    11,492    8%    46,890     41,974     12%
     Operating Margin        35%       30%             32%        29%

    Investments in New
     Businesses:
     Revenues              1,356     1,858  (27%)    6,865      7,205    (5%)
     Expenses              2,973     5,073  (41%)   15,795     19,670   (20%)
                           -----     -----                     ------   ----
     Operating Loss      (1,617)   (3,215)  (50%)   (8,930)   (12,465)  (28%)
     Operating Margin        n/a       n/a              n/a       n/a

    LSV:
     Revenues             47,759    82,151  (42%)   263,268    345,645  (24%)
     Expenses(1)          30,833    51,515  (40%)   164,783    213,926  (23%)
                          ------    ------          -------    -------
     Operating Profit     16,926    30,636  (45%)    98,485    131,719  (25%)
     Operating Margin        35%       37%              37%        38%

     Consolidated Segment
      Totals:
     Revenues           $268,402  $353,409  (24%)$1,247,919 $1,369,028   (9%)
     Expenses            184,326   238,018  (23%)   843,414    912,227   (8%)
                         -------   -------          -------    -------
     Operating Profit    $84,076  $115,391  (27%)  $404,505   $456,801  (11%)
     Operating Margin         31%      33%               32%       33%

    (1) Includes $23,200 and $42,387 for the three-month period ended December
        31, 2008 and 2007, respectively, and $135,251 and $181,591 for the
        twelve-month period ended December 31, 2008 and 2007, respectively, of
        minority interest to the other partners of LSV.

A reconciliation of the totals reported for the business segments to the applicable line items in the Consolidated Statements of Income for the three and twelve-month periods ended December 31, 2008 and 2007 is as follows:



                               Three Months Ended   Twelve Months Ended
                                  December 31,          December 31,
                                2008          2007       2008      2007
                                ----          ----       ----      ----

    Total Operating profit
     from business segments    $84,076      $115,391   $404,505  $456,801

    Corporate overhead
     expenses                   (8,079)      (11,586)   (38,955)  (42,045)
    Minority interest
     reflected in segments      23,518        43,859    138,079   186,500
     LSV Employee Group
      Expenses (1)              (1,820)       (1,821)    (7,280)   (7,281)
                               -------       -------    -------   -------

    Income from operations     $97,695      $145,843   $496,349  $593,975


    (1) Includes $1,806 for the three-month period ending December 31, 2008
        and 2007, and $7,222 for the twelve-month period ended December 31,
        2008 and 2007 of amortization expense related to intangible assets
        owned by LSV Employee Group LLC.  The amortization is offset through
        Minority interest since SEI does not have any ownership in LSV
        Employee Group LLC.

Fourth-Quarter Business Commentary:

    --  Revenues were down across all segments due to the severe decline in the
        capital markets. The Institutional Investors and Investment Managers
        segments partially offset the negative capital market impact with new
        business growth.
    --  Operating results were positively affected by reduced compensation costs
        in all segments except LSV. Other income represents a one-time benefit
        related to interest expense previously recorded.
    --  The company's percentage ownership in LSV remained at approximately
        43 percent.  In the fourth-quarter 2008, the company recognized $16.9
        million as its portion of the earnings from LSV versus $30.6 million in
        the fourth-quarter 2007.
    --  Assets under management declined by $27.5 billion during the
        fourth-quarter 2008 to $134.3 billion, primarily due to market
        depreciation.
    --  The fourth-quarter 2008 results include a $61.6 million non-cash charge
        related to money market funds support agreements and a $2.7 million
        charge related to the decline in fair value for SIV securities purchased
        from an SEI-sponsored money market fund.  SEI has recognized losses of
        $158.2 million during 2008 and cumulative losses of $183.3 million
        associated with SIV- related issues involving SEI-sponsored money market
        funds.  Additional information about the capital support agreements,
        including the total principal amount as of December 31, 2008, is
        attached to this release and is also contained in SEI's 2007 Form
        10-K filed February 26, 2008 and SEI's 2008 third-quarter Form 10-Q
        filed November 10, 2008, and SEI's current report on form 8-K filed
        December 2, 2008.
    --  In the fourth-quarter 2008, SEI's effective tax rate was about 50
        percent. The effective tax rate was affected by a higher than usual
        state tax rate of about 14 percent due to the uncertainty of the future
        use of the SIV losses for Pennsylvania state tax purposes because of net
        operating loss carryforward limitations.
    --  In the fourth-quarter, SEI purchased 1,110,000 shares of its common
        stock for $16.6 million.

Earnings Conference Call

A conference call to review earnings is scheduled for 2:00 PM ET on January 29, 2009. Investors may listen to the call at www.seic.com (Investor Information section), or listen at www.earnings.com, a service of Thomson Streetevents. The call may also be accessed at numerous financial services web sites including AOL and Yahoo. Investors may also listen to replays at these web sites, or by telephone at (USA) 1-800-475-6701; (International) 320-365-3844, access code 983434.

About SEI

SEI (Nasdaq: SEIC) is a leading global provider of outsourced asset management, investment processing and investment operations solutions. The company's innovative solutions help corporations, financial institutions, financial advisors, and affluent families create and manage wealth. As of December 31, 2008, through its subsidiaries and partnerships in which the company has a significant interest, SEI administers $380 billion in mutual fund and pooled assets and manages $134 billion in assets. SEI serves clients, conducts or is registered to conduct business and/or operations, from more than 20 offices in over a dozen countries. For more information, visit www.seic.com.

Many of the statements in this release may be considered "forward looking statements" and include discussions about future operations, strategies and financial results. Forward-looking statements are based upon estimates and assumptions that involve risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.




                                      SEI INVESTMENTS COMPANY
                                 CONSOLIDATED STATEMENTS OF INCOME
                               (In thousands, except per share data)
                                        (Unaudited)

                                               Three Months Ended December 31,
                                                    2008                2007

    Asset management, admin. and distribution
     fees                                        $191,247           $278,086
    Information processing and software
     servicing fees                                56,003             62,170
    Transaction-based and trade execution fees     21,152             13,153

    Total revenues                                268,402            353,409

    Commissions and fees                           41,296             46,666
    Compensation, benefits and other personnel     61,517             88,857
    Consulting, outsourcing and professional fees  24,208             27,443
    Data processing and computer related           11,500             10,785
    Facilities, supplies and other costs           19,920             22,546
    Depreciation and amortization                  12,266             11,269

    Total expenses                                170,707            207,566

    Income from operations                         97,695            145,843

    Minority interest                             (21,419)           (41,440)
    Net loss on investments (1) (2)               (64,631)           (23,880)
    Interest and dividend income                    2,995              5,282
    Interest expense                                 (740)            (1,013)
    Other income                                    5,577                  -

    Income before taxes                            19,477             84,792

    Income taxes                                    9,828             31,160

    Net income                                     $9,649            $53,632


    Diluted earnings per common share                $.05               $.27

    Shares used to calculate diluted earnings per
     common share                                 192,030            200,297

    Basic earnings per common share                  $.05               $.28

    Shares used to calculate basic earnings
     per common share                             190,858            194,321


    (1) Includes $61,559 and $25,122 for the three month period ended
        December 31, 2008 of a non-cash charge related to money market
        funds support agreements.
    (2) Includes $2,733 for the three month period ended December 31, 2008 of
        a loss related to the purchase of structured investment vehicles from
        a SEI-sponsored money market fund.



                                    SEI INVESTMENTS COMPANY
                            CONSOLIDATED STATEMENTS OF INCOME
                          (In thousands, except per share data)
                                         (Unaudited)

                                             Twelve Months Ended December 31,
                                                   2008                 2007

    Asset management, admin. and distribution
     fees                                        $955,399          $1,091,424
    Information processing and software
     servicing fees                               229,807             230,301
    Transaction-based and trade execution fees     62,713              47,303

    Total revenues                              1,247,919           1,369,028

    Commissions and fees                          171,972             176,523
    Compensation, benefits and other personnel    309,870             350,150
    Consulting, outsourcing and professional
     fees                                         103,789              94,642
    Data processing and computer related           44,602              42,189
    Facilities, supplies and other costs           74,378              74,413
    Depreciation and amortization                  46,959              37,136

    Total expenses                                751,570             775,053

    Income from operations                        496,349             593,975

    Minority interest                            (129,256)          (175,879)
    Net loss on investments (1) (2)              (158,018)           (25,395)
    Interest and dividend income                   13,740             18,596
    Interest expense                               (3,418)            (4,709)
    Other income                                    5,577              2,952

    Income before taxes                           224,974            409,540

    Income taxes                                   85,720            149,731

    Net income                                   $139,254           $259,809


    Diluted earnings per common share                $.71              $1.28

    Shares used to calculate diluted earnings
     per common share                             195,233            202,231

    Basic earnings per common share                  $.73              $1.32

    Shares used to calculate basic earnings per
     common share                                 192,057            196,120

    (1) Includes $148,861 for the twelve month period ended December 31,
        2008 of a non-cash charge related to money market funds support
        agreements.
    (2) Includes $9,321 for the twelve month period ended December 31, 2008
        of a loss related to the purchase of structured investment vehicles
        from a SEI-sponsored money market fund.



                                SEI INVESTMENTS COMPANY
                                CONDENSED BALANCE SHEETS
                                     (In thousands)

                                            (Unaudited)
                                            December 31,    December 31,
                                                2008             2007
    Assets

    Cash and short-term investments           $416,643        $360,921
    Restricted cash                             14,000          10,250
    Receivables                                208,209         275,109
    Securities owned                                 -          16,777
    Other current assets                       100,819          31,877

         Total current assets                  739,671         694,934

    Property and equipment, net                148,124         143,516
    Marketable securities                       86,693          77,169
    Capitalized software, net                  270,606         231,684
    Goodwill                                    22,842          22,842
    Intangible assets, net                      52,518          60,177
    Other assets, net                           21,261          22,043

         Total assets                       $1,341,715      $1,252,365



    Liabilities

    Current liabilities (1)                   $329,894        $230,367
    Long-term debt                              24,332          43,971
    Deferred income taxes                      104,548          73,600
    Long term liabilities                        4,067          11,895
    Minority interest                          112,870         136,149

    Shareholders' Equity                       766,004         756,383

         Total liabilities and shareholders'
          equity                            $1,341,715      $1,252,365

    (1) Includes $173,983 and $25,122 at December 31, 2008 and December 31,
        2007, respectively, of an accrual related to money market funds
        support agreements.



                            SEI INVESTMENTS COMPANY
                                ASSET BALANCES
                                (In millions)
                                (Unaudited)


                         Dec. 31,   Mar. 31,   Jun. 30,   Sep. 30,   Dec. 31,
                            2007       2008       2008       2008       2008
    Private Banks:
     Equity/Fixed Income
     prgms.               $21,160    $18,904    $18,163    $14,436    $10,573
     Collective Trust
      Fund prgm.            1,007      1,008        955      1,028      1,145
     Liquidity funds        8,886      9,198      8,345      9,253      9,194
                            -----      -----      -----      -----      -----
     Total assets under
      mgmt.               $31,053    $29,110    $27,463    $24,717    $20,912

     Client assets under
      admin.               14,235     13,897     13,242     12,301     10,622
                           ------     ------     ------     ------     ------
     Total assets         $45,288    $43,007    $40,705    $37,018    $31,534

    Investment Advisors:
     Equity/Fixed Income
      prgms.              $36,378    $32,736    $31,938    $27,817    $21,631
     Collective Trust
      Fund prgm.            2,295      2,310      2,259      2,471      2,606
     Liquidity funds        2,079      2,461      2,410      2,859      3,436
                            -----      -----      -----      -----      -----
     Total assets under
      mgmt.               $40,752    $37,507    $36,607    $33,147    $27,673

    Institutional
     Investors:
     Equity/Fixed
      Income prgms.       $44,833    $43,134    $43,608    $39,775    $34,966
     Collective Trust
      Fund prgm.              897        924        947      1,001        942
     Liquidity funds        3,629      4,077      3,950      3,930      4,582
                            -----      -----      -----      -----      -----
     Total assets under
      mgmt.               $49,359    $48,135    $48,505    $44,706    $40,490

    Investment
     Managers:
     Equity/Fixed Income
      prgms.                  $24        $20        $19        $10         $8
     Collective Trust
      Fund prgm.            6,651      6,571      6,572      6,453      5,974
     Liquidity funds          325        571        438        699        869
                              ---        ---        ---        ---        ---
     Total assets under
      mgmt.                $7,000     $7,162     $7,029     $7,162     $6,851

    Client assets under
     admin. ( C )         215,124    225,005    228,722    256,553    234,628
                          -------    -------    -------    -------    -------
    Total assets         $222,124   $232,167   $235,751   $263,715   $241,479

    Investments
     in New
     Businesses:
     Equity/Fixed Income
      prgms.                 $929       $869       $838       $704       $519
     Liquidity funds           74         77         98        115        153
                               --         --         --        ---        ---
     Total assets under
      mgmt.                $1,003       $946       $936       $819       $672

    LSV Asset
     Management
     Equity/Fixed Income
      prgms.              $67,599    $61,765    $57,692    $51,296    $37,714

    Consolidated:
     Equity/Fixed Income
      Prgms (A)          $170,923   $157,428   $152,258   $134,038   $105,411
     Collective Trust
      Fund prgm.           10,850     10,813     10,733     10,953     10,667
     Liquidity funds       14,993     16,384     15,241     16,856     18,234
                           ------     ------     ------     ------     ------
     Total assets under
      mgmt.              $196,766   $184,625   $178,232   $161,847   $134,312

     Client assets under
      admin. (B)          229,359    238,902    241,964    268,854    245,250
                          -------    -------    -------    -------    -------
     Total assets        $426,125   $423,527   $420,196   $430,701   $379,562

    (A)   Equity/Fixed Income programs include $2,377 of assets invested in
          various asset allocation funds at December 31, 2008.
    (B)   In addition to the numbers presented, SEI also administers an
          additional $7,424 in Funds of Funds assets (as of December 31,
          2008) on which SEI does not earn an administration fee.
    ( C ) Client assets under administration in the Investment Managers
          segment include $78.6 billion of assets balances that require
          limited services and therefore are at fee levels below our normal
          service assets.



                            SEI Investments Company
              Impact of Support Provided to Sponsored Money Market Funds
              Fourth-Quarter 2008 and Cumulative as of December 31, 2008
                                 (in thousands)

                            Par Value
                                of       Support     Required
                            Securities   Amount    Collateral
                            ----------   -------   ----------
    Securities currently
     held by funds:
    Capital Support
     Agreement (1)          $257,737     $257,737   $158,080
    Capital Support
     Agreement (2)            68,109       30,000     30,000
                              ------       ------     ------
    Total of securities
     currently held by funds 325,846      287,737    188,080

    Securities purchased from
     funds:
    Gryphon (formerly Cheyne) 15,034            -          -
                              ------          ---        ---
    Total of all Securities $340,880     $287,737   $188,080


                               Fourth Quarter 2008       Cumulative
                             ----------------------   --------------------
                              Gross      After-Tax    Gross      After-Tax
                             Charge        Charge     Charge      Charge
                             ------      ---------    ------     ---------
    Securities currently
     held by funds:
    Capital Support
     Agreement (1)
    Capital Support
     Agreement (2)           $53,348      $31,898   $147,007      $90,997
    Total of securities
     Currently held by
     funds                     8,211        4,857     26,976       16,698
                               -----        -----     ------       ------
                              61,559       36,775    173,983      107,695
    Securities purchased from
     funds:
    Gryphon (formerly Cheyne)  2,733        1,613      9,321        5,770
                               -----        -----      -----        -----
    Total of all Securities  $64,292      $38,368   $183,304     $113,465

    (1) Pertains to the Amended and Restated Capital Support Agreement for
        the SEI Daily Income Trust Prime Obligation Fund
    (2) Pertains to the Amended and Restated Capital Support Agreement for
        the SEI Liquid Asset Trust Prime Obligation Fund

SOURCE SEI Investments Company