Russell adjusts staffing, operations to support commission recapture service growth (Russell.com)

Russell Adjusts Staffing, Operations To Support Commission Recapture Service Growth
2003 Result: Client Savings Top $115 Million

TACOMA, Wash. — After five years of substantial growth in its commission recapture business, Russell Investment Group is reassigning staff and adjusting operations to further enhance efficiency and better serve its institutional clients. The primary change involves the company's expanding network of correspondent brokers, which will carry out all of the company's commission recapture transactions.

Russell's commission recapture service, which is available in 40 countries, traded $156 billion in 2003. The service saved clients a total of $115 million during the year and, by the end of 2004, total savings since the service began in 1969 likely will surpass $1 billion. Thirteen correspondent brokers currently participate in Russell's program for U.S. equities and 24 brokers participate in the program worldwide. Five additional brokers are expected to join Russell's roster in 2004.

With its network of outside brokers well established, Russell found that only 3% of commission recapture transactions were flowing through two Tacoma-based Russell associates assigned to handle directed trades. To adjust for future growth, Russell reassigned one of the traders to its transition management business and the other to a new position designed to work closely with money managers which participate in the commission recapture service. In addition, Greg Gilbert joined Russell in January as Manager of Commission Recapture, a new position aimed at bolstering the firm's overall service.

"As the largest provider of commission recapture services, we continue to adapt our program to the current market environment," said Bob Werner, managing director, Implementation Services. "Our primary objective is to maintain best execution practices for securities trading and provide the plan sponsor and money manager the ability to participate in this program with ease and efficiency."

Werner added that Russell has made recent investments in information technology to continue automating the trade reconciliation effort in order to ensure each client receives each commission dollar credit.

"These changes stem from clients who suggested the addition of more correspondent brokers, allowing the investment managers more flexibility and options for participation in order to meet their clients' expectations," Werner said. "This is a growing business, and we always listen to feedback and ideas for improvement from our client base."

About Russell
Russell Investment Group, global leader in multi-manager investing, provides investment products and services in more than 35 countries. Russell manages more than $95 billion in assets and advises clients worldwide representing more than $1.6 trillion. Founded in 1936, Russell is a subsidiary of Northwestern Mutual and is headquartered in Tacoma, Wash., with additional offices in New York, Toronto, London, Paris, Singapore, Auckland and Tokyo.

Commission Recapture is the most widely adopted trade cost management tool used by institutional investors. It provides investors the ability to manage commission costs lower, while maintaining best execution.

Russell Investment Group is a registered trade name of Frank Russell Company, a Washington, USA corporation, which operates through subsidiaries worldwide. Frank Russell Company is a subsidiary of The Northwestern Mutual Life Insurance Company.

RC#3728