CIN.L Regulatory News (CIN)

LSE:CIN

19th August 2014

City of London Group plc ("COLG" or "the Company" or "the Group")

Interim Management Statement

Key events

· Trade Finance Partners experiencing healthy growth in business volumes and now fully utilising Macquarie funding facility of £23m

· Therium achieves four case wins since last financial year end and is appointed to advise new €7m litigation fund

· Early discussions under way with potential new partners for Therium

· Significant progress in achieving holding company cost reductions

· Search continues for £30m of debt funding for loans and leasing business

Trade Finance Partners

Trade Finance Partners Limited ("TFPL"), the Group's 43% associate engaged in trade finance has seen welcome growth in new business. It is now fully utilising its existing facility of £23m with Macquarie Bank Limited and expects shortly to step up its facility size. Growth has been evidenced both in SME lending and in commodity trade finance.

Therium

Therium, the Group's 50% associate engaged in litigation funding, has won four cases since COLG's financial year end with a partial loss on one case. The amounts committed to these cases by Therium's investors were £5m and the investors' share of the awards, prior to expenses, amounts to £9m. In the meantime, Therium was pleased to be appointed as litigation adviser to a newly established fund of €7m. The process to secure a new partner for Therium has commenced and is progressing well. Discussions have started with a number of parties.

Group Costs

Significant progress is being made in reducing central costs. COLG has sub-let half of its office space and has sought to eliminate all discretionary external costs. It has also reduced the number of full time equivalent staff from nine to three, compared to this time last year.

Credit Asset Management

Credit Asset Management Limited ("CAML"), COLG's subsidiary providing loans to professional firms and lease finance to SMEs, continues to seek £30m of debt funding to go alongside £10m of conditionally committed equity in order to build economic scale.

Enquiries:

Note on forward looking statements

This interim management statement may contain certain statements about the future outlook for COLG and its subsidiaries. Although the directors believe their expectations are based on reasonable assumptions, any statements about the future outlook may be influenced by factors that could cause actual outcomes to be materially different. This statement has been drawn up and presented with the purposes of complying with English law. Any liability arising out of or in connection with it will be determined in accordance with English law.

Notes to Editors

City of London Group plc is fully listed on the London Stock Exchange plc (LSE symbol CIN).

COLG is a financial services group focused on providing finance to the SME and professional services sectors. It does this by financing trade and securing specialist funding throughout the supply chain to help fuel growth in these sectors. COLG seeks to identify and exploit product niches and business models in these sectors where they are supported by strong day to day management teams, providing initial equity, working capital and seed funding for those teams.

Since 2009, COLG has focused on Specialist Financing and Alternative Fund Management. As part of its strategy to build a quality Financial Services Group, COLG has developed four specialist financing funds, pledging significant seed funds to Therium Capital Management Limited, a third party Litigation Funder, Credit Asset Management Limited and Professions Funding Limited, which respectively provide asset backed finance to SMEs and working capital loans to professional practice firms and finally Trade Finance Partners Limited, a trade finance provider to the SME market.