San Mateo, CA, July 25, 2002 -- Franklin Resources, Inc. (Franklin Templeton Investments) (NYSE: BEN) today reported net income of $125.7 million, or $0.48 per share diluted, on revenues of $666.1 million for the quarter ended June 30, 2002, compared with net income of $120.0 million, or $0.46 per share diluted, on revenues of $626.0 million in the preceding quarter and net income of $119.7 million, or $0.46 per share diluted, on revenues of $609.5 million in the comparable quarter a year ago. Operating income increased 4% this quarter over the prior quarter, 23% over the same quarter in the prior year, and by 6% for the nine months ended June 30, 2002 over the same period in the prior year.

As of June 30, 2002, assets under management by the company's subsidiaries were $270.4 billion, as compared to $274.5 billion last quarter and $267.9 billion at this time last year. Simple monthly average assets under management during the current quarter were $274.8 billion compared to $267.9 billion in the preceding quarter and $255.9 billion in the same quarter a year ago. Equity assets now comprise 53% of total assets under management as compared to 54% last quarter and 55% at June 30, 2001. Fixed-income assets now comprise 31% of total assets under management, as compared to 30% last quarter and 29% at the same time last year. As of June 30, 2002 and March 31, 2002, hybrid assets account for 15% of total assets under management, as compared to 14% at June 30, 2001. Sales and reinvested dividends exceeded redemptions ("net inflows") for the seventh consecutive quarter. Complex-wide net inflows were $5.6 billion for the current quarter compared to $5.0 billion for the prior quarter and $2.7 billion for the comparable quarter a year ago.

Fiscal Third Quarter 2002 Highlights

• Performance and Products^1,2
  (See important footnotes in "Supplemental Information" section at the end of the release.)
• Over 79% of Franklin Templeton's long-term U.S. retail mutual fund assets were in funds ranked in the top two quartiles of their respective Lipper peer groups for the one-, three-, five- and 10-year periods ended June 30, 2002.^3,4
• In Lipper's mutual fund evaluation tool, Lipper Leaders, Franklin Templeton Investments garnered more awards than any other mutual fund company under the consistent return and preservation categories combined as of June 30, 2002.⁵
• Over 90% of Templeton equity mutual fund assets were in funds ranked in the top two quartiles of their respective Lipper peer groups for the one-, three-, five- and 10-year periods ended June 30, 2002. Templeton Foreign Fund and Templeton Growth Fund ranked in the top quintile of their respective Lipper peer groups for the one-, three-, five- and 10-year periods ended June 30, 2002, and outpaced their respective benchmark indices, the MSCI EAFE Index and MSCI World Index, for the same time periods.^3,6
• Templeton Growth Fund was rated 5 stars overall by Morningstar as of June 30, 2002. Templeton Foreign Fund and Templeton World Fund were rated 4 stars overall by Morningstar as of June 30, 2002.^7,8
• All six Mutual Series funds were ranked in the top two quartiles of their respective Lipper peer groups for the one-, three-, five- and 10-year periods ended June 30, 2002.^3,9
• Announced that Franklin California Growth Fund will be renamed Franklin Flex Cap Growth Fund effective September 1, 2002. The fund was rated 4 stars overall by Morningstar as of June 30, 2002, and ranked in the top quintile of its Lipper peer group for the one-, three-, five- and 10-year periods ended June 30, 2002.^3,7,10,11
• Franklin Templeton Investments Corp. (Canada) successfully launched the Series T group of funds designed for Canadians looking for a tax efficient withdrawal plan from their investments.

• Global Business Developments
• Franklin Templeton Investments was recognized as Worth magazine's Editor's Choice for "Favorite Mutual Fund Family."
• CEO Charles B. Johnson was recognized by Forbes.com as one of 12 chief executives who have successfully led their respective companies for over a 25 year period.
• New assignments for FTI Institutional include a Franklin U.S. multi-cap equity mandate for CalPERS, the first combined Templeton-Fiduciary global core strategy mandate for Conference of Seventh Day Adventists and a Franklin small-cap equity strategy for the New Mexico Educational Retirement Board.
• Franklin Templeton Private Client Group's new global equity all cap multiple discipline strategy, which pairs the investment expertise of Templeton and Fiduciary, was added to Salomon Smith Barney's Consulting Group's Diversified Strategic Portfolios product.
• Defined Contribution Services received the 2002 achievement award from the Association of Graphic Communicators for the "The Path to Your Retirement Future" enrollment book.

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: Institutional assets totaling approximately $17.2 billion are invested in U.S. Retail fund and annuity products and are disclosed in U.S. Retail assets in the above table. Total institutional and high net-worth assets at June 30, 2002 were approximately $92.3 billion, of which high net-worth assets comprised $10.8 billion.

Conference Call Information

As previously announced, members of the investment community and general public are invited to listen to the earnings conference call today, Thursday, July 25, 2002 at 1:30 p.m. Pacific Time. Access to the teleconference will be available via franklintempleton.com 10 minutes before the start of the call or by dialing (877) 260-8900 in the U.S. or (612) 288-0337 internationally.

A replay of the call will be archived on franklintempleton.com through August 2, 2002. The replay can also be accessed by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally and using access code #642738, after 5:00 p.m. Pacific Time on July 25 through 11:59 p.m. Pacific Time on August 2.

Franklin Templeton Investments provides global and domestic investment management services through its Franklin, Templeton, Mutual Series and Fiduciary Trust subsidiaries. The San Mateo, CA-based company has over 50 years of investment experience. For more information, please visit franklintempleton.com or call 1-800/DIAL BEN®.

Supplemental Information

1. Nothing in this section shall be considered a solicitation to buy or an offer to sell a security to any person in any jurisdiction where such offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. For more information on any U.S. Franklin Templeton fund, investors should request a prospectus containing more complete information, including sales charges, expenses and risks, from securities dealers or by calling Franklin Templeton Distributors, Inc. at 1-800/DIAL BEN® (1-800/342-5236). Investors should read the prospectus carefully before investing or sending money. Franklin Templeton Distributors, Inc., One Franklin Parkway, San Mateo, CA, is the funds' principal distributor and a wholly owned subsidiary of Franklin Resources, Inc.
2. Past performance does not guarantee future results. Morningstar ratings are based on Class A shares. Lipper rankings are based on Class A shares, with the exception of those for Mutual Series, which are based on Class Z shares, which are offered to qualified investors only and have no sales charges nor Rule 12b-1 fees. All asset data is based on 05/31/02 figures. Indices are unmanaged and one cannot invest directly in them. Unless otherwise noted, fund returns quoted reflect Class A shares. Performance returns, ratings and rankings for other classes may vary. Investment return and principal value will fluctuate with market conditions and an investor may experience a gain or loss when they sell their shares.
3. Lipper calculates averages by taking all the funds in a peer group and averaging their total returns for the periods indicated. Lipper tracks 128 peer groups of long-term U.S. retail mutual funds, and the groups vary in size from 6 to 885. Lipper total return calculations include reinvested dividends and capital gains, but do not include sales charges or expense subsidization by the manager. Results may have been different if these or other factors had been considered.
4. Source: Lipper® Inc., 6/30/02. Of the eligible Franklin Templeton non-money market funds tracked by Lipper, 35, 40, 34 and 19 funds ranked in the top quartile and 24, 25, 22 and 19 funds ranked in the second quartile, for the one-, three-, five- and 10-year periods, respectively, for their respective Lipper peer groups.
5. Source: Lipper® Inc., 6/30/02. Franklin Templeton funds received 87 Lipper Leader designations for Preservation and 47 Lipper Leader designations for Consistent Return. Lipper Leader for Consistent Return ratings reflect the degree of a fund's historical success in achieving superior risk-adjusted returns, adjusted for volatility, relative to peers. Lipper Leader for Preservation ratings reflect the degree of a fund's historical success in avoiding periods of losses relative to other funds within the same asset class. Preservation ratings are relative, rather than absolute, measures, and funds named Lipper Leaders for Preservation may still experience losses periodically; those losses may by larger for equity and mixed equity funds than for fixed-income funds. Twenty percent of funds analyzed in each category are named Lipper Leaders. Lipper Leaders measure past fund performance, and past performance does not guarantee future results. Lipper Leader status does not necessarily imply that a fund had the best performance within its category. Lipper Leader status is based on returns for a 3-year period and is calculated monthly using data available at the time of the calculation; Lipper undertakes no responsibility for updating the calculations more frequently than monthly to incorporate more current data.
6. Source: Lipper® Inc., 6/30/02. 10 out of 11 eligible Templeton equity funds ranked in the top two Lipper quartiles for the one-year period, 9 of 11 for the three-year period, 5 of 11 for the five-year period and 6 of 8 for the 10-year period for their respective Lipper peer groups. Templeton Growth Fund Class A ranked 16 in a universe of 317 funds in Lipper's "Global Funds" group for the one-year period, 18 of 211 for the three-year period, 19 of 136 for the five-year period and 5 of 27 for the 10-year period. Templeton Foreign Fund Class A ranked 55 in a universe of 784 funds in Lipper's "International Funds" group for the one-year period, 52 of 563 for the three-year period, 52 of 381 for the five-year period and 15 of 81 for the 10-year period. Source for MSCI returns: Standard & Poor's Micropal.
7. Source: [Morningstar]© 6/30/02. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating^TM based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and 10-year (if applicable) Morningstar Rating metrics.
8. Source: [Morningstar]© 6/30/02. Based on Class A shares, Templeton Growth Fund was rated against the following numbers of U.S. domiciled "World Stock" funds over the following time period: 241 funds in the last three years, 164 in the last five years and 33 in the last 10 years. With respect to these "World Stock" funds, the fund received a Morningstar Rating of 4 stars, 4 stars and 5 stars for the three-, five-, 10-year periods, respectively. Based on Class A shares, Templeton Foreign Fund was rated against the following numbers of U.S. domiciled "Foreign Stock" funds over the following time period: 621 funds in the last three years, 420 in the last five years and 84 in the last 10 years. With respect to these "Foreign Stock" funds, the fund received a Morningstar Rating of 4 stars, 4 stars and 4 stars for the three-, five-, 10-year periods, respectively. Based on Class A shares, Templeton World Fund was rated against the following numbers of U.S. domiciled "World S! tock" funds over the following time period: 241 funds in the last three years, 164 in the last five years and 33 in the last 10 years. With respect to these "World Stock" funds, the fund received a Morningstar Rating of 4 stars, 4 stars and 4 stars for the three-, five-, 10-year periods, respectively.
9. Source: Lipper® Inc., 6/30/02. 6 out of 6 eligible Mutual Series equity funds ranked in the top two Lipper quartiles for the one-year period, 6 of 6 for the three-year period, 5 of 5 for the five-year period and 3 of 3 for the 10-year period for their respective Lipper peer groups.
10. Source: [Morningstar]© 6/30/02. Based on Class A shares, Franklin California Growth Fund was rated against the following numbers of U.S. domiciled "Mid-Cap Growth" funds over the following time periods: 475 funds in the last three years, 322 in the last five years and 79 in the last 10 years. With respect to these "Mid-Cap Growth" funds, the fund received a Morningstar Rating of 3 stars, 3 stars and 5 stars for the three-, five-, 10-year periods, respectively.
11. Source: Lipper® Inc., 6/30/02. Franklin California Growth Fund Class A ranked 77 in a universe of 406 funds in Lipper's "Multi-Cap Growth Funds" group for the one-year period, 13 of 233 for the three-year period, 12 of 154 for the five-year period and 1 of 45 for the 10-year period.

Forward-Looking Statements

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 Factors" section in Franklin's recent filings with the U.S. Securities and Exchange Commission, including, without limitation, the "Risk Factors" section of the Management's Discussion and Analysis of Financial Condition and Results of Operations in Franklin's Annual Report on Form 10-K for the fiscal year ended September 30, 2001.

• The levels of our assets under management are subject to significant fluctuations.
• We face strong competition from numerous and sometimes larger companies.
• Changes in the distribution channels on which we depend could reduce our revenues or hinder our growth.
• Previously announced revenue and cost synergies from the acquisition of Fiduciary Trust Company International may not be fully realized and may take longer to realize than originally anticipated.
• For the next several years, insurance costs may increase materially and we may not be able to obtain the same types or amounts of coverage.
• We may not recover all losses on insurance claims for property damage and business interruptions arising out of the terrorist attacks on September 11, 2001.