San Mateo, CA, July 26, 2001 -- Franklin Resources, Inc. (Franklin Templeton Investments) (NYSE: BEN) today reported net income of $119.7 million, or $0.46 per share diluted, on revenues of $609.5 million for the quarter ended June 30, 2001, compared with net income of $131.7 million, or $0.54 per share diluted, on revenues of $577.4 million in the preceding quarter and net income of $140.4 million, or $0.58 per share diluted, on revenues of $568.9 million in the comparable quarter a year ago. This quarter's operating results include Fiduciary Trust Company International Inc. ("Fiduciary") from April 10, 2001 and the related temporary impact of the amortization of intangibles of approximately $7.0 million and employee retention costs of approximately $7.5 million. Net income for the nine months ended June 30, 2001 was $400.9 million, or $1.60 per share diluted, on revenues of $1,751.0 million as compared to net income of $421.3 million, or $1.70 per share diluted, on revenues of $1,747.1 million a year ago.

"Since joining forces with Fiduciary on April 10, 2001, we have been carefully examining our overall business practices and structure to identify areas in which we can leverage our individual strengths and expertise," said Charles B. Johnson, chairman and CEO of Franklin Resources, Inc. "We are also making changes to ensure that our combined organization is well positioned to expand in markets that we have jointly identified as areas of growth." Anne Tatlock, chairman and CEO of Fiduciary Trust Company International, commented, "Our initial conviction that a combination with Franklin Templeton Investments would benefit both organizations is holding true. We are learning from one another and finding that each organization has much to offer the other on many levels."

As of June 30, 2001, assets under management by the company's subsidiaries were $267.9 billion, as compared to $215.7 billion last quarter and $229.9 billion at this time last year. Simple monthly average assets under management during the current quarter were $255.9 billion compared to $224.9 billion in the preceding quarter and $228.0 billion in the same quarter a year ago. Equity assets now comprise 55% of total assets under management as compared to 67% at June 30, 2000. Fixed income assets now comprise 29% of total assets under management, as compared to 27% at the same time last year. Hybrid assets now account for 14% of total assets under management, as compared to 4% at the same time last year. This change in mix is directly related to the inclusion of Fiduciary assets under management during the quarter. For the quarter ended June 30, 2001, sales and reinvested dividends exceeded redemptions ("net inflows") complex-wide by $2.7 billion, and in the quarters ended March 31, 2001 and June 30, 2000 net inflows were $1.8 billion and $0.6 billion.

Third Quarter 2001 Highlights

* Non Financial Information Deleted

• Global Business Developments
• Opened new 560,000-square-foot headquarters campus in San Mateo, California.
• Received approximately $490 million in net proceeds from a zero-coupon convertible notes offering in May. The company concurrently purchased three million shares of Franklin Resources' stock, retired outstanding debt and used the balance of the proceeds for other general corporate purposes.
• Franklin Templeton Investments was selected as one of the "Best Places to Work in Silicon Valley" by San Jose Magazine, June 2001 issue.
• Increased advertising spending on both cable and primetime spot markets.
• Ran full-page advertisements in The Wall Street Journal highlighting strong performance of Franklin Templeton's various fund groups.
• Announced realignment of Mutual Series management.
• Introduced online shareholder account look-up in Germany and electronic delivery in the United States, as well as an investment advisor site in Canada.

• Fiduciary Trust Update
• Franklin Templeton Investments completed the acquisition of Fiduciary Trust Company International on April 10, 2001.
• Franklin Templeton Institutional and Fiduciary Trust International are combining to form FTI Institutional, a single global institutional sales and marketing platform.
• Completed the integration of the financial and human resources systems.
• The integration team continues to focus on realizing the cost savings estimated at the time the deal was announced, and the revenue enhancing opportunities identified since closing.
• Operating results include approximately $7.5 million of employee retention bonus expense.

• Accounting for Intangibles Update
• Quarterly results include approximately $7.0 million of goodwill and other intangible assets amortization from the Fiduciary Trust acquisition.
• With the adoption of Statement No. 142, Goodwill and Other Intangible Assets, on June 29, 2001 by the FASB, Franklin Templeton Investments will adopt the new rule in conjunction with the conversion guidance provided by FASB on October 1, 2001 for its fiscal 2002 year. We expect that the impact of the change in rules on our financial results for the 2002 fiscal year would reduce total amortization expense by approximately $50 million annually, covering all acquisitions made to date and subject to the annual impairment tests as specified in the new accounting statement.

1 EBITDA Margin: Earnings before interest, taxes on income, depreciation and the amortization of intangibles divided by total revenues.
2 Operating Margin: Operating income divided by total operating revenues.

1 EBITDA Margin: Earnings before interest, taxes on income, depreciation and the amortization of intangibles divided by total revenues.
2 Operating Margin: Operating income divided by total operating revenues.

Note: A significant number of institutional assets are invested in U.S. Retail funds and are disclosed in that category in the above table. Total institutional assets at March 31, 2001 were over $90 billion.

Conference Call Information

As previously announced, members of the investment community and general public are invited to listen to the conference call today, Thursday, July 26, 2001 at 1:30 p.m. Pacific Standard Time. Access to the teleconference will be available via franklintempleton.com 10 minutes before the start of the call or by dialing (800) 288-8976 in the U.S. or (612) 332-1213 internationally.

A replay of the call will be archived on franklintempleton.com through August 2, 2001. The replay can also be accessed by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally and using access code #593661, after 5:00 p.m. Pacific Standard Time on July 26 through 11:59 p.m. Pacific Standard Time on August 2.

Franklin Templeton Investments provides global and domestic investment management, shareholder and distribution services to the Franklin, Templeton and Mutual Series mutual funds, institutional and private accounts in approximately 125 different nations worldwide. Franklin Templeton Investments' headquarters are located at One Franklin Parkway, San Mateo, CA, 94403.

* Non Financial Information Deleted

Statements in this press release regarding Franklin Resources, Inc.'s business which are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of risks, uncertainties and other important factors that could cause the actual results and outcomes to differ materially from any future results or outcomes expressed or implied by such forward-looking statements. These risks, uncertainties and other important factors are described in more detail in the risk factor section in Franklin's recent filings with the U.S. Securities and Exchange Commission, including, the "Forward-Looking Statements" section of the Management's Discussion and Analysis of Financial Condition and Results of Operations in Franklin's Form 10-K for the fiscal year ended September 30, 2000.