To say the least, the financial markets have become very interesting over the past week.  The news on Lehman, followed by the U.S. Government financing of AIG, the continued market pressure on a number of firms, and the actions of governmental authorities and regulators around the world in addressing current market concerns, has many wondering what is next. As we all digest these interesting global markets, SEI’s primary focus as always is on our clients.

To start, SEI has no direct corporate exposure to either Lehman or AIG and we have communicated with you concerning what exposure, if any, our investment products may have.  We posted a brief report on this issue on our website on Monday.

Although we are a financial services company in the eyes of many, our business model is unlike most other diversified financial services firms.  For example, SEI does not rely on the market to provide daily liquidity to fund our operation.  This is a primary reason firms have failed in not only the current environment, but in the past. 

In addition we do not take principal risk, actively trade the assets on our balance sheet, use leverage within our balance sheet, nor underwrite the risk of either through lending or insurance underwriting activities.  This differentiates us from the other companies reported to be experiencing financial difficulties.  Throughout our history we have worked to maintain a strong balance sheet, and today is no different.  Our balance sheet has strength reflected through cash available, highly collectable receivables, and no direct issued debt.

None of us know how the markets will behave in the short-term over the coming days, weeks and months.  SEI is continuing to monitor the status of other financial institutions that are experiencing difficulties and is taking appropriate steps to manage operational and financial exposure to such firms.  Rest assured that SEI is well positioned in our markets to grow as things settle down.  During these times we continue to focus on clients.  We are committed to providing excellent service, while continuing to make smart business decisions for SEI and our shareholders.  We believe these efforts will continue to add significant value to our company and our clients over the long-term.

If you would like to understand our financial position better, please read our most recently filed 10-Q.

Thank you for continuing to partner with SEI.