2006 Developments

• Our operations supporting the financial services sector have performed superbly, demonstrated by the growth in our fund and unit trust administration business. During the year, we more than doubled funds under administration - which now exceed £30bn
• Growth has come organically, through acquisition, by increasing our product range and by entering new markets including Jersey and Dublin for offshore funds
• Structural changes in the industry are increasingly driving demand for outsourcing solutions. We provide a wide range of fund administration services including a “hosting” solution for fund managers. Under this arrangement, the fund manager outsources the administration of 39 out of 40 functions to Capita. The manager retains the core function of investment management
• Capita Registrars have administered 7 out of 10 of the UK’s largest flotations
• Successfully transferred and developed services that could be delivered at greatly reduced cost with high service standards from our operations in India. Capita Financial Services is currently the largest internal user of our offshoring facilities and is an excellent internal reference.

2007 Priorities and challenges

• Maintain high levels of compliance across the business and develop solutions which help clients meet increasingly onerous regulatory requirements
• Continue to work with other parts of the business, notably Life & Pensions, to provide a single provider solution covering both policy and underlying investment administration
• Continue to drive margin growth from leveraging our scale and operating model
• Continue to expand our nearshore operations in Ireland and Jersey
• Pursue further appropriate acquisition opportunities.