KCG 8-K KCG Announces Consolidated Earnings of $0.08

KCG Holdings, Inc. (NYSE: KCG)

2

Quarter

2014

Earnings

Presentation

August 1, 2014

nd

Exhibit 99.2

Safe Harbor

Certain

statements

contained

herein

may

constitute

“forward-looking

statements”

within

the

meaning

of

the

safe

harbor

provisions

of

the

U.S.

Private

Securities

Litigation

Reform

Act

of

1995.

Forward-looking

statements

are

typically

identified

by

words

such

as

“believe,”

“expect,”

“anticipate,”

“intend,”

“target,”

“estimate,”

“continue,”

“positions,”

“prospects”

or

“potential,”

by

future

conditional

verbs

such

as

“will,”

“would,”

“should,”

“could”

or

“may,”

or

by

variations

of

such

words

or

by

similar

expressions.

These

“forward-looking

statements”

are

not

historical

facts

and

are

based

on

current

expectations,

estimates

and

projections

about

KCG’s

industry,

management’s

beliefs

and

certain

assumptions

made

by

management,

many

of

which,

by

their

nature,

are

inherently

uncertain

and

beyond

our

control.

Any

forward-looking

statement

contained

herein

speaks

only

as

of

the

date

on

which

it

is

made.

Accordingly,

readers

are

cautioned

that

any

such

forward-looking

statements

are

not

guarantees

of

future

performance

and

are

subject

to

certain

risks,

uncertainties

and

assumptions

that

are

difficult

to

predict

including,

without

limitation,

risks

associated

with:

(i)

the

strategic

business

combination

(the

“Mergers”)

of

Knight

Capital

Group,

Inc.

(“Knight”)

and

GETCO

Holding

Company,

LLC

(“GETCO”),

including,

among

other

things,

(a)

difficulties

and

delays

in

integrating

the

Knight

and

GETCO

businesses

or

fully

realizing

cost

savings

and

other

benefits,

(b)

the

inability

to

sustain

revenue

and

earnings

growth,

and

(c)

customer

and

client

reactions

to

the

Mergers;

(ii)

the

August

1,

2012

technology

issue

that

resulted

in

Knight’s

broker-dealer

subsidiary

sending

numerous

erroneous

orders

in

NYSE-listed

and

NYSE

Arca

securities

into

the

market

and

the

impact

to

Knight’s

capital

structure

and

business

as

well

as

actions

taken

in

response

thereto

and

consequences

thereof;

(iii)

the

sale

of

KCG’s

reverse

mortgage

origination

and

securitization

business

and

the

departure

of

the

managers

of

KCG’s

listed

derivatives

group;

(iv)

changes

in

market

structure,

legislative,

regulatory

or

financial

reporting

rules,

including

the

increased

focus

by

regulators,

the

New

York

Attorney

General,

Congress

and

the

media

on

market

structure

issues,

and

in

particular,

the

scrutiny

of

high

frequency

trading,

alternative

trading

systems,

market

fragmentation,

colocation,

access

to

market

data

feeds,

and

remuneration

arrangements

such

as

payment

for

order

flow

and

exchange

fee

structures;

(v)

past

or

future

changes

to

organizational

structure

and

management;

(vi)

KCG’s

ability

to

develop

competitive

new

products

and

services

in

a

timely

manner

and

the

acceptance

of

such

products

and

services

by

KCG’s

customers

and

potential

customers;

(vii)

KCG’s

ability

to

keep

up

with

technological

changes;

(viii)

KCG’s

ability

to

effectively

identify

and

manage

market

risk,

operational

and

technology

risk,

legal

risk,

liquidity

risk,

reputational

risk,

counterparty

and

credit

risk,

international

risk,

regulatory

risk,

and

compliance

risk;

(ix)

the

cost

and

other

effects

of

material

contingencies,

including

litigation

contingencies,

and

any

adverse

judicial,

administrative

or

arbitral

rulings

or

proceedings;

and

(x)

the

effects

of

increased

competition

and

KCG’s

ability

to

maintain

and

expand

market

share.

The

list

above

is

not

exhaustive.

Readers

should

carefully

review

the

risks

and

uncertainties

disclosed

in

KCG’s

reports

with

the

SEC,

including,

without

limitation,

those

detailed

under

“Risk

Factors”

in

KCG’s

Annual

Report

on

Form

10-K

for

the

year-ended

December

31,

2013,

under

“Certain

Factors

Affecting

Results

of

Operations”

in

KCG’s

Quarterly

Report

on

Form

10-Q

for

the

period

ended

March

31,

2014,

and

other

reports

or

documents

KCG

files

with,

or

furnishes

to,

the

SEC

from

time

to

time.

For

additional

disclosures,

please

see

https://www.kcg.com/legal/global-disclosures.

2nd Quarter 2014 Summary

KCG

financial

results

affected

by

the

deterioration

in

market

conditions

across

asset classes

Strong

revenue

capture

per

U.S.

equity

dollar

value

traded

in

market

making

despite the

market

conditions

Modest

market

share

gains

across

market

making,

agency

execution

and

trading

venues

Added

quantitative-based

trading

strategy

and

analysis

to

the

client

offering

Combined

primary

U.K.

broker

dealers

Named

Phil

Allison

CEO

of

KCG

Europe

Limited*

Completed

an

additional

$50

million

debt

repayment

Repurchased

4.5

million

shares

for

$52.9

million

1

* Employment commences September

22, 2014

Market Conditions

2

Market

conditions

reflect

the

continuing

after

effects

of

the

2008

financial

crisis

Sources: BATS Global Markets, VistaOne Solutions, OCC, CSI, Bloomberg, Reuters, EBS, SIFMA, TRACE, MSRB; * 2Q14 SEC Rule 605 share volume  includes an estimate of June 2014 data based on proprietary

information

-

Reduced

trading

activity

among

global

banks

in

response

to

the

implementation

of

new

regulations

-

Dampened

volatility

from

more

than

four

years

of

near

zero

interest rates

-

Avg.

daily

consolidated

U.S.

equity

volume

declined

13%

while

retail

share

volume

fell

approximately

20%

and

realized

volatility

for

the

S&P

500

averaged

just

9.2

In

2Q14,

global

markets

posted

sequential

declines

across

several

major

asset

classes

Avg. daily volume in select securities markets

2Q13

3Q13

4Q13

1Q14

2Q14

Consolidated U.S. equity dollar volume

$232.4 bn

$207.8 bn

$229.8 bn

$275.8 bn

$242.8 bn

Consolidated U.S. equity share volume

6.5 bn

5.8 bn

6.1 bn

6.9 bn

6.1 bn

SEC Rule 605 “retail”

U.S. equity share volume*

801.1 mn

730.2 mn

783.0 mn

854.1 mn

686.3 mn

U.S. equity futures contracts

3.6 mn

2.7 mn

2.2 mn

2.9 mn

2.3 mn

U.S. options contracts

17.5 mn

15.0 mn

16.2 mn

17.9 mn

15.8 mn

European equity notional value traded (USD)

$950 bn

$906 bn

$944 bn

$1,197 bn

$1,080 bn

Asian equity share volume

8.9 bn

7.9 bn

7.2 bn

7.4 bn

6.1 bn

FX notional value traded (USD) among reporting venues

$264.3 bn

$222.0 bn

$202.5 bn

$232.2 bn

$189.4 bn

U.S. Treasuries

$583.4 bn

$520.9 bn

$520.7 bn

$522.1 bn

$490.7 bn

U.S. corporate bonds

$19.2 bn

$16.5 bn

$17.1 bn

$20.8 bn

$20.2 bn

Transactions under 250 bonds

14,653

13,578

13,011

13,334

12, 372

Market conditions in U.S. equities

15,000

12,500

10,000

7,500

5,000

2,500

90

75

60

45

30

15

0

Realized volatility for the S&P 500

Consolidated U.S. equity share volume

0

KCG Financial Results

Pre-Tax Earnings (Loss) from Continuing Operations By Business Segment

(in thousands)

(unaudited)

Market Making

Revenues

Expenses

Pre-tax earnings

Global Execution Services

Revenues

Expenses

Pre-tax earnings

Corporate and Other

Revenues

Expenses

Pre-tax earnings

Consolidated

Revenues

Expenses

Pre-tax earnings

3

For the three months ended

December 31, 2013

March 31, 2014

For the trailing

four quarters ended

June 30, 2014

240,110

192,257

47,853

$

91,366

107,720

(16,354)

137,862

47,988

89,874

469,338

347,965

121,373

$

232,519

47,951

84,065

88,557

(4,491)

6,790

66,949

(60,159)

323,374

340,075

(16,699)

184,569

$

$

277,346

76,032

87,220

85,204

2,016

19,091

37,755

(18,664)

383,657

324,273

59,384

201,314

$

$

218,446

36,004

85,903

85,167

736

9,784

(22,233)

314,133

299,626

14,507

182,442

32,017

$

$

968,421

207,840

348,554

366,648

(18,093)

173,527

184,709

(11,182)

1,490,502

1,311,939

178,563

760,582

$

$

3rd quarter 2013 results include a gain of $128.0 million on GETCO’s investment in Knight as well as expenses of $25.6 million related to the merger, integration and reduction in

workforce

4th quarter 2013 results include a gain of $1.4 million on a strategic asset as well as expenses of $37.9 million related to the merger, integration, reduction in workforce and debt

reduction

1st quarter 2014 results include a gain of $9.6 million from the merger of BATS and Direct Edge as well as expenses of $7.8 million related to the merger, integration and debt

reduction

2nd quarter 2014 results include expenses of $7.0 million related to the integration, reduction in workforce and debt reduction

June 30, 2014

September 30, 2013

Notes:

Market Making

U.S. equities

Non-U.S. equities

Market Making revenue distribution

(trailing four quarters ended June 30, 2014)

4

Sources: KCG, SEC, VistaOne Solutions; KCG dollar volume and revenue capture prior to July 1, 2013 represent combined activity from affiliated broker dealers of GETCO Holding Company, LLC and Knight Capital

Group, Inc.

0

4

8

12

16

20

0

200

400

600

800

1,000

2Q13

3Q13

4Q13

1Q14

2Q14

Retail trading activity and realized volatility

SEC Rule 605

-eligible "retail" U.S equity share volume

Realized volatility for the S&P 500

0.85

0.85

0.88

0.89

0.88

0.96

1.01

0.98

1.26

1.07

0.50

0.60

0.70

0.80

0.90

1.00

1.10

1.20

1.30

1.40

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

1Q12

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

2Q14

KCG dollar volume and revenue capture

Avg. daily dollar volume

Avg. revenue capture per dollar value traded

73%

27%

KCG performed well in 2Q14 despite the abrupt market

wide decline qoq in retail U.S. equity market volume as

well as realized volatility

-

KCG dollar volume declined 8% qoq compared to a 12%

decrease for the consolidated U.S. equity market

-

Avg. revenue capture per dollar value traded remained strong

despite the market conditions

-

Modest market share gains in both retail and consolidated U.S.

equity volume

Contributions from market making in global equities and

FICC negatively affected by the market conditions

Global Execution Services

KCG revenue from agency execution and trading

venues in 2Q14 largely static qoq despite the

deterioration in market conditions

Adjustments and enhancements to institutional equities

are demonstrating results

5

Sources: KCG, BATS Global Markets, Reuters, EBS, TRACE, MSRB; KCG algorithmic services ADV and market share prior to July 1, 2013 represent combined activity from affiliated broker dealers of GETCO Holding

Company, LLC and Knight Capital Group, Inc.

4.22%

4.68%

4.20%

4.05%

4.38%

3.50%

3.65%

3.80%

3.95%

4.10%

4.25%

4.40%

4.55%

4.70%

4.85%

5.00%

200

220

240

260

280

300

2Q13

3Q13

4Q13

1Q14

2Q14

KCG algorithmic services  ADV and market share

Avg. daily U.S. equity share volume

Pct. (%) of consolidated U.S. equity volume

-

More effective alignment of institutional equity sales

-

Improved performance of global ETF team

-

KCG algorithmic services gained market share in U.S. and

European equities

KCG BondPoint continued to steadily gain market share

in corporates and munis

KCG Hotspot ADV and market share

KCG BondPoint ADV and market share

17%

15%

13%

11%

9%

7%

2Q13

3Q13

4Q13

1Q14

2Q14

Avg. daily notional FX dollar volume

2Q13

3Q13

4Q13

1Q14

2Q14

$20

$24

$28

$32

$36

$40

$0

$8

$12

$16

$4

Market share of notional FX dollar volume among reporting venues

Market share of muni bond transactions under 250 bonds

Market share of corporate bond transactions under 250 bonds

Avg. daily fixed income par value traded

11.11%

12.82%

14.33%

13.88%

13.83%

$90

$105

$120

$135

$150

$165

2.5%

5.0%

12.5%

15.0%

17.5%

25.0%

22.5%

20.0%

10.0%

7.5%

0.0%

15.9%

17.4%

17.3%

18.2%

18.6%

3.8%

4.6%

4.9%

5.8%

6.4%

International

KCG is well positioned for adjacent growth in

Europe where the firm is underpenetrated

A rapidly shifting landscape in Europe presents

numerous opportunities aligned with KCG strengths

6

Global revenue distribution

(trailing four quarters ended June 30, 2014)

Pct. growth of KCG algorithmic services

European equity notional value traded

0%

50%

100%

150%

200%

250%

2Q13

3Q13

4Q13

1Q14

2Q14

87%

9%

4%

Americas

Europe

Asia

–

Redrew reporting lines, consolidated European

equities sales, moved into the top 15 broker ranking

in 2H13 and recently named a CEO for the region*

–

In discussions with banks to provide outsourced

trade execution in U.S. and European equities

–

European institutions increasing usage of algorithms

to execute orders

First half 2014 broker ranking

in the Stoxx Europe 600 Index

Rank

Broker

Pct.

(%)

of

notional

value traded

1

Credit Suisse

12.3%

2

Morgan Stanley

11.1%

3

Deutsche Bank

9.2%

4

Merrill Lynch

7.7%

5

JP Morgan

7.6%

6

Barclays Capital

7.0%

7

Citigroup

6.6%

8

Société

Général

6.1%

9

UBS

4.8%

10

Instinet

3.9%

11

Goldman Sachs

3.7%

12

HSBC

2.1%

13

KCG

1.7%

14

Exane

1.4%

15

RBC

1.0%

Sources: Bloomberg, KCG; KCG algorithmic services ADV and market share prior to July 1, 2013 represent combined activity

from affiliated broker dealers of GETCO Holding Company, LLC and Knight Capital Group, Inc.; * Employment commences

September 22, 2014 

Consolidated Expenses

Decrease in compensation and benefits driven

by a nearly 14% reduction in headcount in the

first year of operation

Initial reduction in communications and data

processing of approximately $23.5 million* on

an annualized run-rate basis since the merger

close

Cut the quarterly debt interest expense by

more

than

50%

as

a

result

of

a

series

of

debt

repayments

Decline in occupancy and equipment rentals

expense

of

10%

from

2H13

to

1H14

attributable

to the consolidation of offices in Chicago and

London

Other expenses can vary based on corporate

insurance costs, recruiting fees, moving costs

and general office expenses

7

Compensation and benefits

Communications and data processing

Depreciation and amortization

Debt interest expense

Professional

fees

Occupancy and equipment rentals

Business

development

Other

$0

$25

$50

$75

$100

$125

$150

$175

$200

$225

$250

3Q13

4Q13

1Q14

2Q14

First year expense trends

See addendum for a reconciliation of  GAAP to non-GAAP financial results. * In an investor presentation dated November 19, 2013 available at

http://investors.kcg.com,  

the pre-merger pro forma 1H13 expense from communications and data processing was $86.8 million. In comparison to

the 1H14 actual combined expense from communications and data processing, the annualized savings on a run-rate basis amounts to $23.5 million.

Debt Interest Expense

(in $ millions)

July 1, 2013

June 30, 2014

3.50%

convertible

notes

*

375

117

5.75% term credit agreement

535

0

8.25%

senior

secured

notes

†

305

305

Total debt

1,215

422

* The convertible notes mature on March 15, 2015

†

The senior secured notes mature on June 15, 2018; certain restrictions governing redemptions expire

on  June 15, 2015

KCG aggressively paid down debt in the first year

of operation

The firm fully retired the term credit agreement

ahead of the December 2017 maturity date saving

$66 million in future interest expense

KCG substantially achieved its target capital

structure

The convertible notes are due to mature in March

2015

8

Source: KCG

$1,215

$422

$250

$500

$750

$1,000

$1,250

Jul

-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan

-14

Feb-14

Mar-14

Apr-14

May-14

Jun

-14

Debt

$16.2mn

$12.8mn

$9.4mn

$7.3mn

$2

$4

$6

$8

$10

$12

$14

$16

$18

3Q13

4Q13

1Q14

2Q14

Quarterly debt interest expense

$0

$0

Additional Financials

(in $ millions)

June 30, 2014

March 31, 2014

Cash and cash equivalents

$     600.9

$     651.1

Debt

422.3

472.3

Stockholders’

equity

1,533.7

1,566.2

-----

Debt-to-tangible equity ratio

0.32

0.35

Tangible book value per share

$11.04

$10.85

Book value per share

$12.66

$12.46

Conservative management of the balance sheet

Released $200 million in excess capital from the

integration of the predecessor firms and sale of

assets in the first year of operation

Generated $186.5 million in free cash flow from

operating income over the past four quarters

In 2Q14 began to return capital to stockholders

through share repurchases

See addendum for a reconciliation of GAAP to non-GAAP financial results. Net revenues represent total revenues less execution and clearance fees, payment for order flow and collateralized financing interest as well as

any one-time gains. Free cash flow represents income from continuing operations less capital expenditures plus non-cash items such as depreciation and amortization, stock-based compensation and non-GAAP adjustments

included in the Regulation G tables.

9

3Q13

4Q13

1Q14

2Q14

Total revenues

Net revenues

$0

$50

$150

$200

$250

$300

$350

$400

$100

$0

$10

$20

$30

$40

$50

$60

$70

3Q13

4Q13

1Q14

2Q14

Non-

GAAP pre-tax income from continuing operations

Free cash flow from operating income

Total revenues and net revenues

Earnings and free cash flow

–

Liquidity buffer of $350 million

–

Regular stress tests for extreme scenarios

Summary of First Year Activities

Integrated

direct-to-client

and

non-client,

exchange-based

U.S.

equity

market

making

Combined overlapping units including

algorithmic

services,

options

market

making,

DMM

and

LMM

Restructured the institutional ETF desk

Consolidated European equity sales

Combined offices in Chicago and London

Recruited Charles Haldeman to serve as Non-

Executive Chairman of the Board of Directors

Added quantitative-based trading strategy and

analysis to the client offering

Reduced overall headcount nearly 14%

Reduced debt by $793 million

Consolidated institutional U.S. equity sales

Recruited Global Head of FICC Trading, Co-

Head

of

Global

Execution

Services

and

Platforms,

and

CEO

of

KCG

Europe

Ltd.*

Combined support functions including

Technology,

Finance,

Legal,

Compliance,

Risk,

HR

and

Facilities

Brought all U.S. equity clearing in house

Consolidated broker-dealers in the U.S. (KCG

Americas LLC) and U.K. (KCG Europe Limited)

Sold Urban Financial of America

Established a share repurchase program

10

* Employment commences September 22, 2014

SEC Market Structure Priorities

Equity Markets

Market Instability

High Frequency Trading

-

Require certain market participants to register as dealers

and members of FINRA

-

Develop rules to eliminate disruptive trading practices

-

Update market making requirements by developing

affirmative or negative trading obligations

Market Transparency

-

Develop rules to increase transparency around ATSs and

determine whether rules are necessary to reduce

fragmentation

Broker Conflicts

-

Enhance order routing disclosures

-

Require Exchanges to review of order types

Liquidity for smaller companies

-

Proposed tick size pilot for stocks of smaller companies

11

Fixed Income Markets

Price quality and transparency

-

Develop a workable best execution rule for both the

corporate and municipal bond markets

-

Develop rules regarding disclosure of markups in

“riskless

principal”

transactions

for

both

corporate

and

municipal bonds

-

Focus on regulatory initiatives to enhance the public

availability of pre-trade pricing information in the fixed

income markets, particularly with respect to smaller

retail-size orders

-

Proposed Reg SCI

KCG Stockholder Base

General Atlantic

Jefferies

Insiders

Institutional (active)

Index / ETF (passive)

Retail

A legacy investor in GETCO, General Atlantic

increased its stake in the combined firm at the

merger close

A

legacy

investor

in

Knight,

Jefferies

increased

its

stake in the combined firm in the year since the

merger close

‘Insiders’

is comprised of members of the KCG

Management Committee and Board of Directors,

excluding representatives of General Atlantic

As a category, ‘Retail’

includes current KCG

employees as well as former management and

employees of the predecessor firms

Estimated ownership breakdown based on the weighted average shares outstanding of 117.6 million during the second quarter of 2014. Excludes outstanding warrants.

12

24.2%

19.1%

16.9%

16.3%

9.4%

14.1%

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

13

3 months ended June 30, 2014

Market Making

Global Execution

Services

Corporate and

Other

Consolidated

Reconciliation of GAAP pre-tax to non-GAAP pre-tax:

GAAP income (loss) from continuing operations before income taxes

$     36,004

$     736

$     (22,233)

$     14,507

Writedown of capitalized debt costs

-

-

1,995

1,995

Compensation related to reduction in workforce

383

1,886

800

3,069

Writedown of assets and lease loss accrual, net

452

-

1,489

1,941

$     36,839

$     2,622

$     (17,949)

$     21,512

3 months ended March 31, 2014

Market Making

Global Execution

Services

Corporate and

Other

Consolidated

Reconciliation of GAAP pre-tax to non-GAAP pre-tax:

GAAP income (loss) from continuing operations before income taxes

$     76,032

$     2,016

$     (18,664)

$     59,384

Writedown of capitalized debt costs

-

-

7,557

7,557

Income resulting from the merger of BATS and Direct Edge, net

-

-

(9,644)

(9,644)

Writedown of assets and lease loss accrual, net

359

-

(93)

266

Non-GAAP income (loss) from continuing operations before income taxes

$     76,391

$     2,016

$     (20,844)

$     57,563

Non-GAAP income (loss) from continuing operations before income taxes

3 months ended September 30, 2013

Market Making

Global Execution

Services

Corporate and Other

Consolidated

Reconciliation of GAAP pre-tax to non-GAAP pre-tax:

GAAP income (loss) from continuing operations before income taxes

$     47,853

$     (16,354)

$     89,874

$     121,373

Gain on investment in Knight Capital Group, Inc.

-

-

(127,972)

(127,972)

Compensation and other expenses related to reduction in workforce

2,309

15,132

-

17,441

Professional

and

other

fees

related

to

Mergers

and

August

1

st

technology

issue

-

-

7,269

7,269

Writedown of assets and lease loss accrual, net

108

-

828

936

Non-GAAP income (loss) from continuing operations before income taxes

$     50,270

$     (1,222)

$     (30,001)

$     19,048

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

3 months ended December 31, 2013

Market Making

Global Execution

Services

Corporate and Other

Consolidated

Reconciliation of GAAP pre-tax to non-GAAP pre-tax:

GAAP income (loss) from continuing operations before income taxes

$     47,951

$     (4,491)

$     (60,159)

$     (16,699)

Compensation and other expenses related to reduction in workforce

5,254

5,447

708

11,409

-

-

2,785

2,785

Writedown of capitalized debt costs

-

-

13,209

13,209

Gain on strategic asset

-

-

(1,359)

(1,359)

Writedown of assets and lease loss accrual

-

1,681

8,819

10,500

Non-GAAP income (loss) from continuing operations before income taxes

$     53,205

$     2,637

$     (35,997)

$     19,845

14

Professional and

other

fees

related

to

Mergers

and

August

1

st

technology

issue

3 months ended June 30, 2014

GAAP

Adjustments for

non-GAAP presentation

KCG adjusted, normalized

expenses

Employee compensation and benefits

103,430

3,069

100,361

Communications and data processing

38,279

-

38,279

Depreciation and amortization

19,823

-

19,823

Debt interest expense

7,497

-

7,497

Professional fees

7,337

-

7,337

Occupancy and equipment rentals

8,235

-

8,235

Business development

2,609

-

2,609

Writedown of assets, lease loss accrual and capitalized debt costs

3,936

3,936

-

Other

10,767

-

10,767

Total expenses

$     201,913

$     7,005

$     194,908

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

15

Reconciliation of GAAP expenses to normalized non-GAAP expenses:

3 months ended March 31, 2014

GAAP

Adjustments for

non-GAAP presentation

KCG adjusted, normalized

expenses

Reconciliation of GAAP expenses to normalized non-GAAP expenses:

Employee compensation and benefits

122,319

-

122,319

Communications and data processing

36,796

-

36,796

Depreciation and amortization

20,103

-

20,103

Debt interest expense

9,524

-

9,524

Professional fees

5,402

-

5,402

Occupancy and equipment rentals

8,285

-

8,285

Business development

1,683

-

1,683

Writedown of assets, lease loss accrual and capitalized debt costs

7,823

7,823

-

Other

8,643

-

8,643

Total expenses

$     220,578

$     7,823

$     212,755

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

16

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

17

3 months ended December 31, 2013

GAAP

Adjustments for

KCG adjusted, normalized

expenses

Reconciliation of GAAP expenses to normalized non-GAAP expenses:

Employee compensation and benefits

112,209

11,409

100,800

Communications and data processing

37,512

-

37,512

Depreciation and amortization

19,566

-

19,566

Debt interest expense

12,943

-

12,943

Professional fees

7,734

2,491

5,243

Occupancy and equipment rentals

9,358

-

9,358

Business development

1,923

-

1,923

Writedown of assets, lease loss accrual and capitalized debt costs

23,709

23,709

-

Other

13,066

294

12,772

Total expenses

$     238,020

$     37,903

$     200,117

non-GAAP presentation

Regulation G Reconciliation of Non-GAAP

Financial Measures (Continuing Operations)

3 months ended September 30, 2013

GAAP

Adjustments for

non-GAAP presentation

KCG adjusted, normalized

expenses

Reconciliation of GAAP expenses to normalized non-GAAP expenses:

Employee compensation and benefits

129,631

17,441

112,190

Communications and data processing

44,046

-

44,046

Depreciation and amortization

20,091

-

20,091

Debt interest expense

19,350

2,982

16,368

Professional fees

9,077

4,087

4,990

Occupancy and equipment rentals

8,898

-

8,898

Business development

2,644

200

2,444

Writedown of assets and lease loss accrual, net

936

936

-

Other

11,318

-

11,318

Total expenses

$     245,991

$     25,647

$     220,345

18