Ameriprise 2013 Annual Report Download - page 27

Columbia Management and Threadneedle continue to pursue opportunities to maximize their collective investment
capabilities to more effectively manage their current products and portfolios and to design and develop new solutions for
the benefit of our clients. For example, the investment management teams of Columbia Management and Threadneedle
currently manage certain assets for the other under sub-advisory or personnel sharing arrangements. Additionally, research
sharing arrangements and evaluation of other operational resources and capabilities are actively underway.
Product and Service Offerings
We offer a broad spectrum of investment advice and products to individual, institutional and high-net worth investors. In an
effort to address changing market conditions and the evolving needs of investors, we may from time to time develop and
offer new retail and institutional investment products with new and/or innovative investment strategies, including U.S.
mutual funds and their non-U.S. equivalents, ETFs, separately managed accounts, hedge funds and other private funds,
CLOs, and collective funds. The following is an overview of our Asset Management offerings.
U.S. Registered Funds
We provide investment advisory, distribution and other services to the Columbia Management family of funds. The
Columbia Management family of funds includes retail mutual funds, exchange-listed ETFs and U.S. closed-end funds and
variable product funds. Retail mutual funds are available through unaffiliated third-party financial institutions, the
Ameriprise financial advisor network and as part of Ameriprise institutional 401(k) plans. Variable product funds are
available as underlying investment options in variable annuity and variable life insurance products, including RiverSource
products. The Columbia Management family of funds includes domestic and international equity funds, fixed income funds,
cash management funds, balanced funds, specialty funds, absolute return funds and asset allocation funds, including
fund-of-funds, with a variety of investment objectives. At December 31, 2013, our U.S. retail mutual funds, ETFs and U.S.
closed-end funds had total managed assets of $169.4 billion in 137 funds. The variable insurance trust funds (‘‘VIT
Funds’’) that we manage had total managed assets at December 31, 2013 of $70.0 billion in 73 funds.
Columbia Management serves as investment manager for most of our U.S. mutual funds as well as our exchange-listed
ETFs and U.S. closed-end funds and ETFs. Columbia Wanger Asset Management, LLC (‘‘Columbia Wanger’’), a subsidiary
of Columbia Management, also serves as investment manager for certain funds. In addition, several of our subsidiaries
perform ancillary services for the funds, including distribution, accounting, administrative and transfer agency services.
Columbia Management and Columbia Wanger perform investment management services pursuant to contracts with the
U.S. registered funds that are subject to renewal by the fund boards within two years after initial implementation, and
thereafter, on an annual basis.
We earn management fees for managing the assets of the Columbia Management family of mutual funds based on the
underlying asset values. We also earn fees by providing ancillary services to the Columbia Management family of funds.
Historically, certain Columbia Management equity and balanced funds included a performance incentive adjustment that
adjusted management fees, upward or downward, based on the fund’s performance as measured against a designated
index of peers. In 2011 and 2012, in connection with various initiatives to achieve consistent fee structures across all
Columbia Management funds, we discontinued the use of such performance incentive adjustments.
The Columbia Management family of funds also uses sub-advisers to diversify and enhance investment management
expertise. Since the end of 2003, Threadneedle personnel have provided investment management services to certain
Columbia Management funds. In addition to Threadneedle, unaffiliated sub-advisers provide investment management
services to certain Columbia Management funds.
Non-U.S. Funds
Threadneedle offers a fund product range that includes different risk-return options across regions, markets, asset classes
and product structures, which include funds that are similar to U.S. mutual funds. These funds are marketed to non-U.S.
persons and often referred to as UCITS products (Undertakings for Collective Investment in Transferable Securities). UCITS
and other funds offered by Threadneedle typically are structured as Open Ended Investment Companies (‘‘OEICs’’) in the
UK, Societes d’Investissement A Capital Variable (‘‘SICAVs’’) in Luxembourg, as well as unit trusts and investment trusts.
The majority of these offerings are registered in and distributed across multiple jurisdictions. At December 31, 2013, our
non-U.S. retail funds had total managed assets of $50.6 billion in 121 funds.
Threadneedle Asset Management Ltd. serves as investment manager for most of our non-U.S. fund products and earns
management fees based on underlying asset values for managing the assets of these funds. Certain Threadneedle affiliates
also earn fees by providing ancillary services to the funds. In addition, certain non-U.S. funds or portions of the portfolios
underlying such funds may receive sub-advisory services, including services provided by both Columbia Management
personnel and other unaffiliated advisers.
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