The following discussion of the financial condition and results of operations of
the Company should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 2021, and the accompanying consolidated
financial statements and notes thereto contained in this Quarterly Report on
Form 10-Q.

Certain statements in this report may be considered forward-looking. Statements
that are not historical or current facts, including statements about beliefs and
expectations, are forward-looking statements. These forward-looking statements
cover, among other things, statements made about general economic and market
conditions, the investment banking industry, objectives and results, and also
may include our belief regarding the effect of various legal proceedings,
management expectations, our liquidity and funding sources, counterparty credit
risk, or other similar matters.

Forward-looking statements involve inherent risks and uncertainties, and
important factors could cause actual results to differ materially from those
anticipated, including those factors discussed under "External Factors Impacting
Our Business" in Part II, Item 1A in this Quarterly Report on Form 10-Q, as well
as the factors identified under "Risk Factors" in Part I, Item 1A of the
Company's Annual Report on Form 10-K for the year ended December 31, 2021, as
updated in our subsequent reports filed with the SEC. These reports are
available at the Company's web site at www.stifel.com and at the SEC web site at
www.sec.gov.

Because of these and other uncertainties, the Company's actual future results
may be materially different from the results indicated by these forward-looking
statements. In addition, the Company's past results of operations do not
necessarily indicate its future results. Forward-looking statements speak only
as of the date they are made, and the Company undertakes no obligation to update
them in light of new information or future events, unless it is obligated to do
so under federal securities laws.

Unless otherwise indicated, the terms "we," "us," "our" or "our company" in this report refer to Stifel Financial Corp. and its wholly owned subsidiaries.

Executive Summary



We operate as a financial services and bank holding company. We have built a
diversified business serving private clients, institutional investors, and
investment banking clients located across the country. Our principal activities
are: (i) private client services, including securities transaction and financial
planning services; (ii) institutional equity and fixed income sales, trading and
research, and municipal finance; (iii) investment banking services, including
mergers and acquisitions, public offerings, and private placements; and (iv)
retail and commercial banking, including personal and commercial lending
programs.

Our core philosophy is based upon a tradition of trust, understanding, and
studied advice. We attract and retain experienced professionals by fostering a
culture of entrepreneurial, long-term thinking. We provide our private,
institutional and corporate clients quality, personalized service, with the
theory that if we place clients' needs first, both our clients and our company
will prosper. Our unwavering client and associate focus have earned us a
reputation as one of the nation's leading wealth management and investment
banking firms. We have grown our business both organically and through
opportunistic acquisitions.

We plan to maintain our focus on revenue growth with a continued appreciation
for the development of quality client relationships. Within our private client
business, our efforts will be focused on recruiting experienced financial
advisors with established client relationships. Within our capital markets
business, our focus continues to be on providing quality client management and
product diversification. In executing our growth strategy, we will continue to
seek out opportunities that allow us to take advantage of the consolidation
among middle-market firms, whereby allowing us to increase market share in our
private client and institutional group businesses.

Stifel Financial Corp., through its wholly owned subsidiaries, is principally
engaged in retail brokerage; securities trading; investment banking; investment
advisory; retail, consumer, and commercial banking; and related financial
services. Our major geographic area of concentration is throughout the United
States, with a growing presence in the United Kingdom, Europe, and Canada. Our
principal customers are individual investors, corporations, municipalities, and
institutions.

Our ability to attract and retain highly skilled and productive associates is
critical to the success of our business. Accordingly, compensation and benefits
comprise the largest component of our expenses, and our performance is dependent
upon our ability to attract, develop, and retain highly skilled associates who
are motivated and committed to providing the highest quality of service and
guidance to our clients.

On July 1, 2022, the Company acquired ACXIT Capital Partners, a leading independent corporate finance and financial advisory firm serving European middle-market clients and entrepreneurs.

Results for the three and six months ended June 30, 2022



For the three months ended June 30, 2022, net revenues decreased 3.9% to $1.1
billion from $1.2 billion during the comparable period in 2021. Net income
available to common shareholders decreased 20.2% to $151.5 million, or $1.29 per
diluted common share for the

                                       45
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three months ended June 30, 2022, compared to $189.8 million, or $1.60 per diluted common share during the comparable period in 2021.

Our revenue decline was primarily attributable to lower capital-raising, transactional, and advisory revenues during the quarter, partially offset by higher net interest income and asset management revenues.



For the six months ended June 30, 2022, net revenues decreased 2.8% to $2.2
billion compared to $2.3 billion during the comparable period in 2021. Net
income available to common shareholders decreased 10.9% to $315.7 million, or
$2.68 per diluted common share for the six months ended June 30, 2022, compared
to $354.5 million, or $3.00 per diluted common share during the comparable
period in 2021.

Our revenue decline was primarily attributable to lower capital-raising and transactional revenues, partially offset by higher net interest income, asset management revenues, and advisory revenues.

External Factors Impacting Our Business



Performance in the financial services industry in which we operate is highly
correlated to the overall strength of economic conditions and financial market
activity. Overall market conditions are a product of many factors, which are
beyond our control and mostly unpredictable. These factors may affect the
financial decisions made by investors, including their level of participation in
the financial markets. In turn, these decisions may affect our business results.
With respect to financial market activity, our profitability is sensitive to a
variety of factors, including the demand for investment banking services as
reflected by the number and size of equity and debt financings and merger and
acquisition transactions, the volatility of the equity and fixed income markets,
the level and shape of various yield curves, the volume and value of trading in
securities, and the value of our customers' assets under management.

Our overall financial results continue to be highly and directly correlated to
the direction and activity levels of the United States equity and fixed income
markets. At June 30, 2022, the NASDAQ, S&P 500, and Dow Jones Industrial
Average, closed 29.5%, 20.6%, and 15.3% lower than their December 31, 2021
closing prices, respectively.

As a participant in the financial services industry, we are subject to
complicated and extensive regulation of our business. The recent economic and
political environment has led to legislative and regulatory initiatives, both
enacted and proposed, that could substantially intensify the regulation of the
financial services industry and may significantly impact us.

                                       46
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RESULTS OF OPERATIONS

Three Months Ended June 30, 2022 Compared with Three Months Ended June 30, 2021

The following table presents consolidated financial information for the periods indicated (in thousands, except percentages):



                                                                                     As a Percentage of Net Revenues For
                                             Three Months Ended June 30,               the Three Months Ended June 30,
                                                                          %
                                          2022            2021          Change          2022                     2021
Revenues:
Commissions                            $   186,681     $   195,579         (4.5 )           16.8 %                   17.0 %
Principal transactions                     125,603         152,597        (17.7 )           11.4                     13.2
Transactional revenues                     312,284         348,176        (10.3 )           28.2                     30.2
Investment banking                         271,075         376,443        (28.0 )           24.5                     32.6
Asset management                           331,264         295,869         12.0             29.9                     25.7
Interest                                   212,754         133,591         59.3             19.2                     11.6
Other income                                (1,917 )        13,235       (114.5 )           (0.2 )                    1.1
Total revenues                           1,125,460       1,167,314         (3.6 )          101.6                    101.2
Interest expense                            17,334          14,178         22.3              1.6                      1.2
Net revenues                             1,108,126       1,153,136         (3.9 )          100.0                    100.0
Non-interest expenses:
Compensation and benefits                  652,709         692,054         (5.7 )           58.9                     60.0
Occupancy and equipment rental              78,251          70,971         10.3              7.1                      6.2
Communication and office supplies           43,645          41,308          5.7              3.9                      3.6
Commissions and floor brokerage             15,106          13,977          8.1              1.4                      1.2
Provision for credit losses                 12,785          (9,652 )        n/m              1.2                     (0.8 )
Other operating expenses                    87,089          80,453          8.2              7.8                      6.9
Total non-interest expenses                889,585         889,111          0.1             80.3                     77.1
Income before income taxes                 218,541         264,025        (17.2 )           19.7                     22.9
Provision for income taxes                  57,725          65,948        (12.5 )            5.2                      5.7
Net income                                 160,816         198,077        (18.8 )           14.5                     17.2
Preferred dividends                          9,321           8,289         12.5              0.8                      0.7
Net income available to common
shareholders                           $   151,495     $   189,788        (20.2 )           13.7 %                   16.5 %




                                       47

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Six months ended June 30, 2022 Compared with Six months ended June 30, 2021

The following table presents consolidated financial information for the periods indicated (in thousands, except percentages):



                                                                                   As a Percentage of Net Revenues For
                                             Six Months Ended June 30,                the Six Months Ended June 30,
                                                                         %
                                         2022            2021         Change          2022                     2021
Revenues:
Commissions                           $   382,590     $   409,193        (6.5 )           17.2 %                   17.9 %
Principal transactions                    284,873         317,603       (10.3 )           12.8                     13.9
Transactional revenues                    667,463         726,796        (8.2 )           30.0                     31.8
Investment banking                        525,921         715,731       (26.5 )           23.6                     31.3
Asset management                          672,900         574,016        17.2             30.2                     25.1
Interest                                  378,189         261,131        44.8             17.0                     11.4
Other income                                6,971          38,869       (82.1 )            0.4                      1.7
Total revenues                          2,251,444       2,316,543        (2.8 )          101.2                    101.3
Interest expense                           26,791          28,618        (6.4 )            1.2                      1.3
Net revenues                            2,224,653       2,287,925        (2.8 )          100.0                    100.0
Non-interest expenses:
Compensation and benefits               1,326,400       1,389,968        (4.6 )           59.6                     60.8
Occupancy and equipment rental            155,277         143,003         8.6              7.0                      6.3

Communication and office supplies 86,101 83,133 3.6

              3.9                      3.6
Commissions and floor brokerage            30,993          29,680         4.4              1.4                      1.3
Provision for credit losses                21,025         (14,904 )       n/m              0.9                     (0.7 )
Other operating expenses                  159,207         165,128        (3.6 )            7.2                      7.2
Total non-interest expenses             1,779,003       1,796,008        (0.9 )           80.0                     78.5
Income before income taxes                445,650         491,917        (9.4 )           20.0                     21.5
Provision for income taxes                111,285         120,825        (7.9 )            5.0                      5.3
Net income                                334,365         371,092        (9.9 )           15.0                     16.2
Preferred dividends                        18,641          16,578        12.4              0.8                      0.7
Net income available to common
shareholders                          $   315,724     $   354,514       (10.9 )           14.2 %                   15.5 %


NET REVENUES

The following table presents consolidated net revenues for the periods indicated (in thousands, except percentages):



                                         Three Months Ended June 30,                   Six Months Ended June 30,
                                                                      %                                            %
                                      2022            2021          Change         2022            2021         Change
Net revenues:
Commissions                        $   186,681     $   195,579         (4.5 )   $   382,590     $   409,193        (6.5 )
Principal transactions                 125,603         152,597        (17.7 )       284,873         317,603       (10.3 )
Transactional revenues                 312,284         348,176        (10.3 )       667,463         726,796        (8.2 )
Capital raising                         71,519         169,778        (57.9 )       144,969         378,584       (61.7 )
Advisory                               199,556         206,665         (3.4 )       380,952         337,147        13.0
Investment banking                     271,075         376,443        (28.0 )       525,921         715,731       (26.5 )
Asset management                       331,264         295,869         12.0         672,900         574,016        17.2
Net interest                           195,420         119,413         63.7         351,398         232,513        51.1
Other income                            (1,917 )        13,235       (114.5 )         6,971          38,869       (82.1 )
Total net revenues                 $ 1,108,126     $ 1,153,136         (3.9 )   $ 2,224,653     $ 2,287,925        (2.8 )

Commissions - Commission revenues are primarily generated from agency transactions in OTC and listed equity securities, insurance products and options. In addition, commission revenues also include distribution fees for promoting and distributing mutual funds.



For the three months ended June 30, 2022, commission revenues decreased 4.5% to
$186.7 million from $195.6 million in the comparable period in 2021. For the six
months ended June 30, 2022, commission revenues decreased 6.5% to $382.6 million
from $409.2 million in the comparable period in 2021.

Principal transactions - Principal transaction revenues are gains and losses on secondary trading, principally fixed income transactional revenues.


                                       48
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For the three months ended June 30, 2022, principal transactions revenues
decreased 17.7% to $125.6 million from $152.6 million in the comparable period
in 2021. For the six months ended June 30, 2022, principal transactions revenues
decreased 10.3% to $284.9 million from $317.6 million in the comparable period
in 2021.

Transactional revenues - For the three months ended June 30, 2022, transactional
revenues decreased 10.3% to $312.3 million from $348.2 million in the comparable
period in 2021. For the six months ended June 30, 2022, transactional revenues
decreased 8.2% to $667.5 million from $726.8 million in the comparable period in
2021 as a result of a decrease in client activity from significantly elevated
levels a year ago. Institutional equity transactional revenues declined from the
year-ago quarter primarily as a result of trading losses and declines in cash
equities. Broad macroeconomic and geopolitical concerns led to volatility in
global equity prices, resulting in trading losses compared with trading gains
during the prior year period. The decrease was partially offset by improved
Institutional fixed income transactional revenue as a result of the Vining
Sparks acquisition, which closed in November 2021.

Investment banking - Investment banking revenues include: (i) capital raising
revenues representing fees earned from the underwriting of debt and equity
securities, and (ii) advisory fees related to corporate debt and equity
offerings, municipal debt offerings, merger and acquisitions, private placements
and other investment banking advisory fees.

For the three months ended June 30, 2022, investment banking revenues decreased 28.0% to $271.1 million from $376.4 million in the comparable period in 2021.



Capital-raising revenues decreased 57.9% to $71.5 million for the three months
ended June 30, 2022 from $169.8 million in the comparable period in 2021. For
the three months ended June 30, 2022, equity capital raising revenues decreased
75.1% to $28.0 million from $112.5 million in the comparable period in 2021. For
the three months ended June 30, 2022, fixed income capital raising revenues
decreased 24.0% to $43.5 million from $57.3 million in the comparable period in
2021.

Advisory revenues decreased 3.4% to $199.6 million for the three months ended
June 30, 2022 from $206.7 million in the comparable period in 2021. The decrease
is primarily attributable to lower levels of completed advisory transactions
during the quarter.

For the six months ended June 30, 2022, investment banking revenues decreased 26.5% to $525.9 million from $715.7 million in the comparable period in 2021.



Capital raising revenues decreased 61.7% to $145.0 million for the six months
ended June 30, 2022 from $378.6 million in the comparable period in 2021. For
the six months ended June 30, 2022, equity capital raising revenues decreased
77.7% to $60.8 million from $272.4 million in the comparable period in 2021. The
decrease is primarily attributable to lower issuances in line with market
volumes in an uncertain market environment. For the six months ended June 30,
2022, fixed income capital raising revenues decreased 20.8% to $84.2 million
from $106.2 million in the comparable period in 2021 as microeconomic conditions
contributed to lower bond issuances during 2022.

Advisory revenues increased 13.0% to $381.0 million for the six months ended
June 30, 2022 from $337.1 million in the comparable period in 2021. The increase
is primarily attributable to higher completed advisory transactions.

Asset management - Asset management revenues are primarily generated by the
investment advisory fees related to asset management services provided for
individual and institutional investment portfolios, along with mutual funds.
Investment advisory fees are earned on assets held in managed or
non-discretionary asset-based programs. Fees from private client investment
portfolios and institutional fees are typically based on asset values at the end
of the prior period. Asset balances are impacted by both the performance of the
market and levels of net new client assets. Rising markets have historically had
a positive impact on investment advisory fee revenues as existing accounts
increase in value, and individuals and institutions may commit incremental funds
in rising markets.

For the three months ended June 30, 2022, asset management revenues increased
12.0% to $331.3 million from $295.9 million in the comparable period in 2021.
For the six months ended June 30, 2022, asset management revenues increased
17.2% to $672.9 million from $574.0 million in the comparable period in 2021.
Please refer to "Asset management" in the Global Wealth Management segment
discussion for information on the changes in asset management revenues.

Other income - Other income primarily includes investment gains and losses,
rental income, and loan originations fees. For the three months ended June 30,
2022, other income decreased 114.5% to a loss of $1.9 million from $13.2 million
during the comparable period in 2021. For the six months ended June 30, 2022,
other income decreased 82.1% to $7.0 million from $38.9 million during the
comparable period in 2021. The decreases are primarily attributable to lower
investment gains and a decrease in loan origination fees from the comparable
periods in 2021.

                                       49
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NET INTEREST INCOME



The following tables present average balance data and operating interest revenue
and expense data, as well as related interest yields for the periods indicated
(in thousands, except rates):

                                                                           Three Months Ended
                                                 June 30, 2022                                            June 30, 2021
                                                      Interest         Average                                Interest
                                                       Income/         Interest                                Income/          Average
                                Average Balance        Expense           Rate           Average Balance        Expense       Interest Rate
Interest-earning assets:
Interest-bearing cash and
federal funds sold             $       1,106,358     $     2,891             1.05 %    $       1,249,189     $       824              0.26 %
Financial instruments owned            1,171,119           4,057             1.39 %              979,682           2,543              1.04 %
Margin balances                        1,105,707           8,732             3.16 %            1,059,293           6,286              2.37 %
Investment portfolio                   7,480,440          46,046             2.46 %            6,918,862          31,539              1.82 %
Loans                                 18,897,545         150,351             3.18 %           12,959,010          92,379              2.85 %
Other interest-bearing
assets                                 1,149,522             677             0.24 %              698,989              20              0.01 %
Total interest-earning
assets/interest income         $      30,910,691     $   212,754             2.75 %    $      23,865,025     $   133,591              2.24 %
Interest-bearing
liabilities:
Stock loan                     $         485,379     $    (4,577 )          (3.77 %)   $         305,892     $    (2,003 )           (2.62 %)
Senior notes                           1,113,841          11,274             4.05 %            1,112,748          11,971              4.30 %
Stifel Capital Trusts                     60,000             395             2.63 %               60,000             302              2.01 %
Deposits                              24,231,942           3,599             0.06 %           18,637,070           1,214              0.03 %
FHLB                                     368,487             794             0.86 %               60,285              41              0.27 %
Other interest-bearing
liabilities                            1,118,845           5,849             2.09 %            1,075,987           2,653              0.99 %
Total interest-bearing
liabilities/interest expense   $      27,378,494          17,334             0.25 %    $      21,251,982          14,178              0.27 %
Net interest income/margin                           $   195,420             2.53 %                          $   119,413              2.00 %



                                                                             Six Months Ended
                                                  June 30, 2022                                           June 30, 2021
                                                       Interest         Average                                Interest         Average
                                                        Income/         Interest                                Income/         Interest
                                 Average Balance        Expense           Rate           Average Balance        Expense           Rate
Interest-earning assets:
Interest-bearing cash and
federal funds sold              $       1,221,352     $     3,975             0.65 %    $       1,641,971     $     1,715             0.21 %
Financial instruments owned             1,173,565           9,477             1.62 %              893,738           5,438             1.22 %
Margin balances                         1,097,672          15,644             2.85 %            1,010,438          12,377             2.45 %
Investment portfolio                    7,432,584          80,308             2.16 %            6,599,580          61,491             1.86 %
Loans                                  18,191,909         271,688             2.99 %           12,539,688         179,618             2.86 %
Other interest-bearing assets           1,044,066          (2,903 )          (0.56 %)             647,579             492             0.15 %
Total interest-earning
assets/interest income          $      30,161,148     $   378,189             2.51 %    $      23,332,994     $   261,131             2.24 %
Interest-bearing liabilities:
Stock loan                      $         364,447         (11,008 )         

(6.04 %) $ 222,964 $ (3,406 ) (3.06 %) Senior notes

                            1,113,707          22,699             4.08 %            1,106,065          24,074             4.35 %
Stifel Capital Trusts                      60,000             705             2.35 %               60,000             606             2.02 %
Deposits                               23,683,947           4,528             0.04 %           18,136,121           2,497             0.03 %
FHLB                                      205,361             825             0.80 %               38,154              52             0.27 %
Other interest-bearing
liabilities                             1,144,620           9,042             1.58 %            1,042,791           4,795             0.92 %
Total interest-bearing
liabilities/interest expense    $      26,572,082          26,791             0.20 %    $      20,606,095          28,618             0.28 %
Net interest income/margin                            $   351,398             2.33 %                          $   232,513             1.99 %


Please refer to Distribution of Assets, Liabilities, and Shareholders' Equity; Interest Rates and Interest Differential table included in "Results of Operations - Global Wealth Management" for additional information on Stifel Bancorp's average balances and interest income and expense.



Net interest income - Net interest income is the difference between interest
earned on interest-earning assets and interest paid on funding sources. Net
interest income is affected by changes in the volume and mix of these assets and
liabilities, as well as by fluctuations in interest rates and portfolio
management strategies. For the three months ended June 30, 2022, net interest
income increased to $195.4 million from $119.4 million during the comparable
period in 2021. For the six months ended June 30, 2022, net interest income
increased to $351.4 million from $232.5 million during the comparable period in
2021.

For the three months ended June 30, 2022, interest revenue increased 59.3% to
$212.8 million from $133.6 million in the comparable period in 2021, principally
as a result of higher interest rates and an increase in interest-earning assets.
The average interest-earning

                                       50
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assets of Stifel Bancorp increased to $26.9 billion during the three months ended June 30, 2022 compared to $20.5 billion during the comparable period in 2021 at average interest rates of 2.95% and 2.42%, respectively.



For the six months ended June 30, 2022, interest revenue increased 44.8% to
$378.2 million from $261.1 million in the comparable period in 2021, principally
as a result of higher interest rates and an increase in interest-earning assets.
The average interest-earning assets of Stifel Bancorp increased to $26.2 billion
during the six months ended June 30, 2022 compared to $20.0 billion during the
comparable period in 2021 at average interest rates of 2.71% and 2.43%,
respectively.

For the three months ended June 30, 2022, interest expense increased 22.3% to
$17.3 million from $14.2 million during the comparable period in 2021. The
increase is primarily attributable to higher interest-bearing liabilities. The
average interest-bearing liabilities of Stifel Bancorp increased to $24.6
billion during the three months ended June 30, 2022 compared to $18.7 billion
during the comparable period in 2021 at average interest rates of 0.07% and
0.03%, respectively.

For the six months ended June 30, 2022, interest expense decreased 6.4% to $26.8
million from $28.6 million in the comparable period in 2021. The decrease is
primarily attributable to lower interest rates, partially offset by higher
interest-bearing liabilities. The average interest-bearing liabilities of Stifel
Bancorp increased to $23.9 billion during the six months ended June 30, 2022
compared to $18.2 billion during the comparable period in 2021 at average
interest rates of 0.05% and 0.03%, respectively.

NON-INTEREST EXPENSES

The following table presents consolidated non-interest expenses for the periods indicated (in thousands, except percentages):



                                           Three Months Ended June 30,                    Six Months Ended June 30,
                                        2022           2021         % Change         2022            2021          % Change
Non-interest expenses:
Compensation and benefits            $   652,709     $ 692,054           (5.7 )   $ 1,326,400     $ 1,389,968           (4.6 )
Occupancy and equipment rental            78,251        70,971           10.3         155,277         143,003            8.6
Communications and office supplies        43,645        41,308            5.7          86,101          83,133            3.6
Commissions and floor brokerage           15,106        13,977            8.1          30,993          29,680            4.4
Provision for credit losses               12,785        (9,652 )          

n/m 21,025 (14,904 ) n/m Other operating expenses

                  87,089        80,453            8.2         159,207         165,128           (3.6 )
Total non-interest expenses          $   889,585     $ 889,111            0.1     $ 1,779,003     $ 1,796,008           (0.9 )


Compensation and benefits - Compensation and benefits expenses, which are the
largest component of our expenses, include salaries, bonuses, transition pay,
benefits, amortization of stock-based compensation, employment taxes and other
employee-related costs. A significant portion of compensation expense is
comprised of production-based variable compensation, including discretionary
bonuses, which fluctuates in proportion to the level of business activity,
increasing with higher revenues and operating profits. Other compensation costs,
including base salaries, stock-based compensation amortization, and benefits,
are more fixed in nature.

For the three months ended June 30, 2022, compensation and benefits expense
decreased 5.7% to $652.7 million from $692.1 million during the comparable
period in 2021. For the six months ended June 30, 2022, compensation and
benefits expense decreased 4.6% to $1.3 billion from $1.4 billion during the
comparable period in 2021. The decrease in compensation and benefits expenses is
primarily attributable to lower variable compensation expense.

Compensation and benefits expense as a percentage of net revenues was 58.9% and
59.6% for the three and six months ended June 30, 2022, respectively, compared
to 60.0% and 60.8% for the three and six months ended June 30, 2021,
respectively. The compensation ratios benefited from higher net interest income,
which is a relatively low compensatory revenue source.

Occupancy and equipment rental - For the three months ended June 30, 2022,
occupancy and equipment rental expense increased 10.3% to $78.3 million from
$71.0 million during the comparable period in 2021. For the six months ended
June 30, 2022, occupancy and equipment rental expense increased 8.6% to $155.3
million from $143.0 million during the comparable period in 2021. The increase
is primarily attributable to higher data processing costs associated with the
continued investments made in of our business lines.

Communications and office supplies - Communications expense includes costs for
telecommunication and data communication, primarily for obtaining third-party
market data information. For the three months ended June 30, 2022,
communications and office supplies expense increased 5.7% to $43.6 million from
$41.3 million during the comparable period in 2021. For the six months ended
June 30, 2022, communications and office supplies expense increased 3.6% to
$86.1 million from $83.1 million during the comparable period in 2021.

Commissions and floor brokerage - For the three months ended June 30, 2022,
commissions and floor brokerage expense increased 8.1% to $15.1 million from
$14.0 million during the comparable period in 2021. For the six months ended
June 30, 2022, commissions and floor brokerage expense increased 4.4% to $31.0
million from $29.7 million during the comparable period in 2021. The increase is
primarily attributable to higher processing expenses, partially offset by lower
electronic communication network ("ECN") trading costs.

                                       51
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Provision for credit losses - For the three months ended June 30, 2022,
provision for credit losses increased to $12.8 million from a credit of $9.7
million during the comparable period in 2021. For the six months ended June 30,
2022, provision for credit losses increased to $21.0 million from a credit of
$14.9 million during the comparable period in 2021. The increase is primarily
attributable to the growth in our loan portfolio and the release of the
provision for credit losses during the comparable periods in 2021.

Other operating expenses - Other operating expenses primarily include license
and registration fees, litigation-related expenses, which consist of amounts we
reserve and/or pay out related to legal and regulatory matters, travel and
entertainment, promotional expenses and expenses for professional services.

For the three months ended June 30, 2022, other operating expenses increased
8.2% to $87.1 million from $80.5 million during the comparable period in 2021.
The increase is primarily attributable to increases in travel and entertainment
expenses, conference-related expenses, litigation expense, subscriptions, and
advertising, partially offset by lower investment banking transaction expenses
and settlement-related expenses. During the second quarter of 2021, other
operating expense was impacted by the recognition of additional earn-out expense
related to a prior acquisition that performed better than expected.

For the six months ended June 30, 2022, other operating expenses decreased 3.6%
to $159.2 million from $165.1 million during the comparable period in 2021. The
decrease is primarily attributable to lower investment banking transaction
expenses, partially offset by increases in travel and entertainment expenses,
subscriptions, advertising, conference-related expenses, settlement-related
expenses, FDIC-insurance expense, and professional fees. As described above,
other operating expense was impacted by the recognition of additional earn-out
expense recorded during the second quarter of 2021.

Provision for income taxes - For the three and six months ended June 30, 2022,
our provision for income taxes was $57.7 million and $111.3 million,
representing an effective tax rate of 26.4% and 25.0%, respectively, compared to
$65.9 million and $120.8 million for the comparable periods in 2021,
representing an effective tax rate of 25.0% and 24.6%, respectively.

SEGMENT ANALYSIS

Our reportable segments include Global Wealth Management, Institutional Group, and Other.



Our Global Wealth Management segment consists of two businesses, the Private
Client Group and Stifel Bancorp. The Private Client Group includes branch
offices and independent contractor offices of our broker-dealer subsidiaries
located throughout the United States. These branches provide securities
brokerage services, including the sale of equities, mutual funds, fixed income
products, and insurance, as well as offering banking products to their private
clients through our bank subsidiaries, which provide residential, consumer, and
commercial lending, as well as FDIC-insured deposit accounts to customers of our
broker-dealer subsidiaries and to the general public.

The success of our Global Wealth Management segment is dependent upon the
quality of our products, services, financial advisors, and support personnel,
including our ability to attract, retain, and motivate a sufficient number of
these associates. We face competition for qualified associates from major
financial services companies, including other brokerage firms, insurance
companies, banking institutions, and discount brokerage firms. Segment revenue
growth, operating income, and segment pre-tax operating margin are used to
evaluate and measure segment performance by our management team in deciding how
to allocate resources and in assessing performance.

The Institutional Group segment includes institutional sales and trading. It
provides securities brokerage, trading, and research services to institutions
with an emphasis on the sale of equity and fixed income products. This segment
also includes the management of and participation in underwritings for both
corporate and public finance (exclusive of sales credits generated through the
Private Client Group, which are included in the Global Wealth Management
segment), merger and acquisition, and financial advisory services.

The success of our Institutional Group segment is dependent upon the quality of
our personnel, the quality and selection of our investment products and
services, pricing (such as execution pricing and fee levels), and reputation.
Segment operating income and segment pre-tax operating margin are used to
evaluate and measure segment performance by our management team in deciding how
to allocate resources and in assessing performance.

The Other segment includes interest income from stock borrow activities, unallocated interest expense, interest income and gains and losses from investments held, amortization of stock-based awards, and all unallocated overhead cost associated with the execution of orders; processing of securities transactions; custody of client securities; receipt, identification, and delivery of funds and securities; compliance with regulatory and legal requirements; internal financial accounting and controls; and general administration and acquisition charges.



We evaluate the performance of our segments and allocate resources to them based
on various factors, including prospects for growth, return on investment, and
return on revenues.


                                       52

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Results of Operations - Global Wealth Management

Three Months Ended June 30, 2022 Compared with Three Months Ended June 30, 2021

The following table presents consolidated financial information for the Global Wealth Management segment for the periods indicated (in thousands, except percentages):



                                                                                 As a Percentage of Net Revenues For
                                           Three Months Ended June 30,             the Three Months Ended June 30,
                                                                      %
                                         2022          2021         Change          2022                     2021
Revenues:
Commissions                            $ 122,004     $ 139,653        (12.6 )           17.5 %                   21.9 %
Principal transactions                    48,466        55,209        (12.2 )            6.9                      8.7
Transactional revenues                   170,470       194,862        (12.5 )           24.4                     30.6
Asset management                         331,243       295,847         12.0             47.5                     46.4
Investment banking                         5,056        11,898        (57.5 )            0.7                      1.9
Interest                                 207,232       131,773         57.3             29.7                     20.7
Other income                              (4,617 )      10,274       (144.9 )           (0.7 )                    1.5
Total revenues                           709,384       644,654         10.0            101.6                    101.1
Interest expense                          11,404         7,087         60.9              1.6                      1.1
Net revenues                             697,980       637,567          9.5            100.0                    100.0
Non-interest expenses:
Compensation and benefits                349,368       341,367          2.3             50.1                     53.5
Occupancy and equipment rental            38,225        33,043         15.7              5.5                      5.2

Communication and office supplies 14,976 14,461 3.6

              2.1                      2.3
Commissions and floor brokerage            6,833         5,939         15.1              1.0                      0.9
Provision for credit losses               12,785        (9,652 )        n/m              1.8                     (1.5 )
Other operating expenses                  30,641        25,104         22.1              4.4                      3.9
Total non-interest expenses              452,828       410,262         10.4             64.9                     64.3
Income before income taxes             $ 245,152     $ 227,305          7.9             35.1 %                   35.7 %



                              June 30,
                          2022        2021
Branch offices               397         391
Financial advisors         2,230       2,190
Independent contractors      100          92
Total financial advisors   2,330       2,282




                                       53
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Six months ended June 30, 2022 Compared with Six months ended June 30, 2021

The following table presents consolidated financial information for the Global Wealth Management segment for the periods indicated (in thousands, except percentages):



                                                                                    As a Percentage of Net Revenues For
                                             Six Months Ended June 30,                 the Six Months Ended June 30,
                                                                         %
                                         2022            2021          Change          2022                     2021
Revenues:
Commissions                           $   252,780     $   287,158        (12.0 )           18.3 %                   22.6 %
Principal transactions                     94,010         108,808        (13.6 )            6.8                      8.6
Transactional revenues                    346,790         395,966        (12.4 )           25.1                     31.2
Asset management                          672,856         573,956         17.2             48.8                     45.2
Investment banking                         10,203          25,447        (59.9 )            0.7                      2.0
Interest                                  371,182         256,148         44.9             26.9                     20.2
Other income                               (2,732 )        31,232       (108.7 )           (0.2 )                    2.5
Total revenues                          1,398,299       1,282,749          9.0            101.3                    101.1
Interest expense                           18,594          13,687         35.9              1.3                      1.1
Net revenues                            1,379,705       1,269,062          8.7            100.0                    100.0
Non-interest expenses:
Compensation and benefits                 714,361         678,088          5.3             51.8                     53.4
Occupancy and equipment rental             75,162          67,120         12.0              5.4                      5.3

Communication and office supplies 29,651 28,863 2.7

              2.1                      2.3
Commissions and floor brokerage            13,720          12,401         10.6              1.0                      1.0
Provision for credit losses                21,025         (14,904 )        n/m              1.5                     (1.2 )
Other operating expenses                   55,221          46,958         17.6              4.1                      3.7
Total non-interest expenses               909,140         818,526         11.1             65.9                     64.5
Income before income taxes            $   470,565     $   450,536          4.4             34.1 %                   35.5 %


NET REVENUES

For the three months ended June 30, 2022, Global Wealth Management net revenues
increased 9.5% to a record $698.0 million from $637.6 million for the comparable
period in 2021. For the six months ended June 30, 2022, Global Wealth Management
net revenues increased 8.7% to a record $1.4 billion from $1.3 billion for the
comparable period in 2021. The increase in net revenues over the comparable
period in 2021 is primarily attributable to increases in net interest income and
asset management revenues, partially offset by lower transactional revenues,
other income, and investment banking revenues.

Commissions - For the three months ended June 30, 2022, commission revenues
decreased 12.6% to $122.0 million from $139.7 million in the comparable period
in 2021. For the six months ended June 30, 2022, commission revenues decreased
12.0% to $252.8 million from $287.2 million in the comparable period in 2021.
The decrease is primarily attributable to a decrease in equities trading and
mutual funds revenue.

Principal transactions - For the three months ended June 30, 2022, principal
transactions revenues decreased 12.2% to $48.5 million from $55.2 million in the
comparable period in 2021. For the six months ended June 30, 2022, principal
transactions revenues decreased 13.6% to $94.0 million from $108.8 million in
the comparable period in 2021.

Transactional revenues - For the three months ended June 30, 2022, transactional
revenues decreased 12.5% to $170.5 million from $194.9 million in the comparable
period in 2021. For the six months ended June 30, 2022, transactional revenues
decreased 12.4% to $346.8 million from $396.0 million in the comparable period
in 2021 as a result of a decrease in client activity from significantly elevated
levels a year ago.

Asset management - For the three months ended June 30, 2022, asset management
increased 12.0% to $331.2 million from $295.8 million in the comparable period
in 2021. For the six months ended June 30, 2022, asset management increased
17.2% to $672.9 million from $574.0 million in the comparable period in 2021.
The increase is primarily attributable to higher asset values and strong
fee-based asset flows. Fee-based account revenues are primarily billed based on
asset values at the end the prior quarter.


                                       54
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Client asset metrics as of the periods indicated (in thousands, except number of accounts and percentages):


                           6/30/22           6/30/21         % Change         3/31/22          % Change
Client assets           $ 377,591,000     $ 402,442,000           (6.2 )   $ 421,414,000             (10.4 )
Fee-based client assets $ 141,223,000     $ 148,838,000           (5.1 )   $ 157,910,000             (10.6 )
Number of client                              1,098,000            5.0         1,140,000               1.1
accounts                    1,153,000
Number of fee-based                             282,000           10.3           307,000               1.3
client accounts               311,000

The decrease in the value of our client assets and fee-based assets was primarily attributable to the decline in the markets, partially offset by asset growth resulting from our recruiting efforts.



Investment banking - Investment banking, which represents sales credits for
investment banking underwritings, decreased 57.5% to $5.1 million for the three
months ended June 30, 2022 from $11.9 million during the comparable period in
2021. For the six months ended June 30, 2022, investment banking revenues
decreased 59.9% to $10.2 million from $25.4 million during the comparable period
in 2021. Please refer to "Investment banking" in the Institutional Group segment
discussion for information on the changes in net revenues.

Interest revenue - For the three months ended June 30, 2022, interest revenue
increased 57.3% to $207.2 million from $131.8 million in the comparable period
in 2021. For the six months ended June 30, 2022, interest revenue increased
44.9% to $371.2 million from $256.1 million during the comparable period in
2021. The increase is primarily attributable to higher interest-earning assets
and higher interest rates. Please refer to "Net Interest Income - Stifel
Bancorp" below for a further discussion of the changes in net interest income.

Other income - For the three months ended June 30, 2022, other income decreased
144.9% to a loss of $4.6 million from $10.3 million in the comparable period in
2021. For the six months ended June 30, 2022, other income decreased 108.7% to a
loss of $2.7 million from $31.2 million during the comparable period in 2021.
The decrease is primarily attributable to lower investment gains and a decrease
in loan origination fees from the comparable periods in 2021.

Interest expense - For the three months ended June 30, 2022, interest expense
increased 60.9% to $11.4 million from $7.1 in the comparable period in 2021. For
the six months ended June 30, 2022, interest expense increased 35.9% to $18.6
million from $13.7 million during the comparable period in 2021. The increase in
interest expense is primarily attributable to higher interest rates and higher
interest-bearing liabilities over the comparable period in 2021.

                                       55
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NET INTEREST INCOME - STIFEL BANCORP



The following tables present average balance data and operating interest revenue
and expense data for Stifel Bancorp, as well as related interest yields for the
periods indicated (in thousands, except rates):

                                             Three Months Ended June 30, 2022                       Three Months Ended June 30, 2021
                                                           Interest         Average                               Interest
                                                            Income/         Interest                               Income/          Average
                                     Average Balance        Expense           Rate         Average Balance         Expense       Interest Rate
Assets:
Interest-bearing cash and federal
funds sold                           $        453,114     $       989             0.87 %   $        611,932      $       207              0.14 %
U.S. government agencies                        2,564              10             1.49                3,337               18              2.11
State and municipal securities
(tax-exempt) (1)                                2,364              11             1.97                2,387               12              1.98
Mortgage-backed securities                    991,282           4,680             1.89            1,070,549            4,105              1.53
Corporate fixed income securities             756,154           5,066             2.68              709,667            4,631              2.61
Asset-backed securities                     5,728,076          36,279             2.53            5,132,922           22,773              1.77
Federal Home Loan Bank and other
capital stock                                  68,079             795             4.67               44,543              357              3.21
Loans (2)
Securities-based loans                      2,972,170          20,701             2.79            2,214,111           10,754              1.94
Commercial and industrial                   8,175,256          77,870             3.81            5,055,398           43,295              3.43
Residential real estate                     6,301,802          39,528             2.51            4,296,541           28,519              2.66
Commercial real estate                        592,325           4,966             3.35              417,650            3,019              2.89
Home equity lines of credit                    95,644             843             3.52               77,606              556              2.86
Construction and land                         431,893           4,056             3.76              572,972            4,472              3.12
Other                                          35,189             520             5.92               38,029              188              1.97
Loans held for sale                           293,266           1,867             2.55              286,703            1,576              2.20

Total interest-earning assets (3) $ 26,899,178 $ 198,181

       2.95 %   $     20,534,347      $   124,482              2.42 %
Cash and due from banks                        12,571                                                21,907
Other non interest-earning assets             118,297                                               479,993
Total assets                         $     27,030,046                                      $     21,036,247
Liabilities and stockholders'
equity:
Deposits:
Money market                         $     23,232,731     $     3,161             0.05 %   $     17,714,414      $       785              0.02 %
Time deposits                                  21,514             142             2.65               60,642              256              1.68
Demand deposits                               977,462             296             0.12              861,187              173              0.08
Savings                                           235               -             0.09                  827                -              0.05
Federal Home Loan Bank advances               368,487             794             0.86               60,285               41              0.27
Other borrowings                                  968              38            15.57                1,309               24              7.44
Total interest-bearing liabilities
(3)                                        24,601,397           4,431             0.07 %         18,698,664            1,279              0.03 %
Non-interest-bearing deposits                 522,531                                               555,846
Other non-interest bearing
liabilities                                    90,597                                               261,438
Total liabilities                          25,214,525                                            19,515,948
Stockholders' equity                        1,815,521                                             1,520,299
Total liabilities and
stockholders' equity                 $     27,030,046                                      $     21,036,247
Net interest income/spread                                $   193,750             2.88 %                         $   123,203              2.39 %
Net interest margin                                                               2.88 %                                                  2.40 %


(1)
Due to immaterial amount of income recognized on tax-exempt securities, yields
were not calculated on a tax-equivalent basis.
(2)
Loans on nonaccrual status are included in average balances.
(3)
Please refer to the Net Interest Income table included in "Results of
Operations" for additional information on our company's average balances and
operating interest and expenses.



                                       56
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The following tables present average balance data and operating interest revenue
and expense data for Stifel Bancorp, as well as related interest yields for the
periods indicated (in thousands, except rates):
                                               Six Months Ended June 30, 2022                         Six Months Ended June 30, 2021
                                                            Interest         Average                               Interest
                                                             Income/         Interest                               Income/          Average
                                      Average Balance        Expense           Rate          Average Balance        Expense       Interest Rate
Assets:
Interest-bearing cash and federal
funds sold                           $         501,032     $     1,295             0.52 %   $         786,127     $       498              0.13 %
U.S. government agencies                         2,778              23             1.62                 3,668              39              2.11
State and municipal securities
(tax-exempt) (1)                                 2,367              23             1.97                 2,390              24              1.97
Mortgage-backed securities                     999,225           9,088             1.82               988,682           7,371              1.49
Corporate fixed income securities              764,505          10,039             2.63               674,933          10,029              2.97
Asset-backed securities                      5,663,709          61,135             2.16             4,929,907          44,028              1.79
Federal Home Loan Bank and other
capital stock                                   59,122           1,154             3.90                42,647             584              2.74
Loans (2)
Securities-based loans                       2,941,610          35,126             2.39             2,108,800          20,487              1.94
Commercial and industrial                    7,867,347         139,867             3.56             4,815,809          82,795              3.44
Residential real estate                      5,994,888          75,059             2.50             4,146,360          55,557              2.68
Commercial real estate                         527,991           8,009             3.03               394,469           6,277              3.18
Home equity lines of credit                     89,657           1,465             3.27                76,238           1,061              2.78
Construction and land                          478,332           8,322             3.48               550,054           8,661              3.15
Other                                           34,374             703             4.09                38,099             407              2.13
Loans held for sale                            257,710           3,137             2.43               409,859           4,373              2.13

Total interest-earning assets (3) $ 26,184,647 $ 354,445

        2.71 %   $      19,968,042     $   242,191              2.43 %
Cash and due from banks                         12,496                                                 20,681
Other non interest-earning assets              139,088                                                459,971
Total assets                         $      26,336,231                                      $      20,448,694
Liabilities and stockholders'
equity:
Deposits:
Money market                         $      22,635,483     $     3,860             0.03 %   $      17,308,376     $     1,528              0.02 %
Time deposits                                   23,026             303             2.63                76,954             700              1.82
Demand deposits                              1,025,199             365             0.07               749,983             269              0.07
Savings                                            239               -             0.05                   808               -              0.05
Federal Home Loan Bank advances                205,361             825             0.80                38,154              52              0.27
Other borrowings                                 1,015              73            14.36                 1,354              52              7.69
Total interest-bearing liabilities
(3)                                         23,890,323           5,426             0.05 %          18,175,629           2,601              0.03 %
Non-interest-bearing deposits                  576,915                                                533,267
Other non-interest bearing
liabilities                                     87,429                                                261,199
Total liabilities                           24,554,667                                             18,970,095
Stockholders' equity                         1,781,564                                              1,478,599
Total liabilities and
stockholders' equity                 $      26,336,231                                      $      20,448,694

Net interest income/spread                                 $   349,019             2.66 %                         $   239,590              2.40 %
Net interest margin                                                                2.67 %                                                  2.40 %


(1)
Due to immaterial amount of income recognized on tax-exempt securities, yields
were not calculated on a tax-equivalent basis.
(2)
Loans on nonaccrual status are included in average balances.
(3)
Please refer to the Net Interest Income table included in "Results of
Operations" for additional information on our company's average balances and
operating interest and expenses.

                                       57
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The following table sets forth an analysis of the effect on net interest income
of volume and rate changes for the three and six month periods ended June 30,
2022 compared to the three and six month periods ended June 30, 2021 (in
thousands):

                                   Three Months Ended June 30, 2022 Compared to Three         Six Months Ended June 30, 2022 Compared to Six
                                               Months Ended June 30, 2021                               Months Ended June 30, 2021
                                               Increase/(decrease) due to:                              Increase/(decrease) due to:
                                   Volume                 Rate                  Total          Volume              Rate               Total
Interest income:
Interest-bearing cash and
federal funds sold               $       (39 )         $       821

$ 782 $ (106 ) $ 903 $ 797 U.S. government agencies

                  (4 )                  (4 )                  (8 )           (8 )               (8 )               (16 )
State and municipal securities
(tax-exempt)                              (1 )                   -                    (1 )           (1 )                -                  (1 )
Mortgage-backed securities              (271 )                 846                   575             79              1,638               1,717
Corporate fixed income
securities                               309                   126                   435             81                (71 )                10
Asset-backed securities                2,881                10,625                13,506          7,123              9,984              17,107
Federal Home Loan Bank and
other capital stock                      235                   203                   438            271                299                 570

Loans


Securities-based loans                 4,387                 5,560                 9,947          9,264              5,375              14,639
Commercial and industrial             29,256                 5,319                34,575         54,159              2,913              57,072
Residential real estate               12,480                (1,471 )              11,009         22,864             (3,362 )            19,502
Commercial real estate                 1,409                   538                 1,947          2,010               (278 )             1,732
Home equity lines of credit              144                   143                   287            203                201                 404
Construction and land                 (2,377 )               1,961                  (416 )       (1,734 )            1,395                (339 )
Other                                    (13 )                 345                   332            (35 )              331                 296
Loans held for sale                       37                   254                   291         (1,992 )              756              (1,236 )
                                 $    48,433           $    25,266           $    73,699     $   92,178         $   20,076         $   112,254
Interest expense:
Deposits:
Money market                     $       811                 1,565           $     2,376     $      579         $    1,753         $     2,332
Time deposits                           (976 )                 862                  (114 )       (1,094 )              697                (397 )
Demand deposits                           26                    97                   123             98                 (2 )                96
Savings                                    -                     -                     -              -                  -                   -
Federal Home Loan Bank
advances                                 529                   224                   753            537                236                 773
Other borrowings                          (5 )                  19                    14             (9 )               30                  21
                                 $       385           $     2,767           $     3,152     $      111         $    2,714         $     2,825


Increases and decreases in interest revenue and interest expense result from
changes in average balances (volume) of interest-earning bank assets and
liabilities, as well as changes in average interest rates. The effect of changes
in volume is determined by multiplying the change in volume by the previous
year's average yield/cost. Similarly, the effect of rate changes is calculated
by multiplying the change in average yield/cost by the previous year's volume.
Changes applicable to both volume and rate have been allocated proportionately.

Net interest income - Net interest income is the difference between interest
earned on interest-earning assets and interest paid on funding sources. Net
interest income is affected by changes in the volume and mix of these assets and
liabilities, as well as by fluctuations in interest rates and portfolio
management strategies. Decreases in short-term interest rates have had a
negative impact on our results, in particular on our net interest income.

For the three months ended June 30, 2022, interest revenue of $198.2 million was
generated from average interest-earning assets of $26.9 billion at an average
interest rate of 2.95%. Interest revenue of $124.5 million for the comparable
period in 2021 was generated from average interest-earning assets of $20.5
billion at an average interest rate of 2.42%.

For the six months ended June 30, 2022, interest revenue of $354.4 million was
generated from average interest-earning assets of $26.2 billion at an average
interest rate of 2.71%. Interest revenue of $242.2 million for the comparable
period in 2021 was generated from average interest-earning assets of $20.0
billion at an average interest rate of 2.43%.

Interest expense represents interest on customer money market accounts, interest
on time deposits, Federal Home Loan Bank advances, and other interest expense.
For the three months ended June 30, 2022, interest expense of $4.4 million was
incurred from average interest-bearing liabilities of $24.6 billion at an
average interest rate of 0.07%. Interest expense of $1.3 million for the
comparable period in 2021 was incurred from average interest-bearing liabilities
of $18.7 billion at an average interest rate of 0.03%.

For the six months ended June 30, 2022, interest expense of $5.4 million was
incurred from average interest-bearing liabilities of $23.9 billion at an
average interest rate of 0.05%. Interest expense of $2.6 million for the
comparable period in 2021 was incurred from average interest-bearing liabilities
of $18.2 billion at an average interest rate of 0.03%.

                                       58
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Please refer to "Net Interest Income - Stifel Bancorp" above for more information regarding average balances, interest income and expense, and average interest rate yields.



NON-INTEREST EXPENSES

For the three months ended June 30, 2022, Global Wealth Management non-interest
expenses increased 10.4% to $452.8 million from $410.3 million for the
comparable period in 2021. For the six months ended June 30, 2022, Global Wealth
Management non-interest expenses increased 11.1% to $909.1 million from $818.5
million for the comparable period in 2021.

Compensation and benefits - For the three months ended June 30, 2022,
compensation and benefits expense increased 2.3% to $349.4 million from $341.4
million during the comparable period in 2021. For the six months ended June 30,
2022, compensation and benefits expense increased 5.3% to $714.4 million from
$678.1 million during the comparable period in 2021. The increase over the
comparable period in 2021 is principally due to increased variable compensation
as a result of revenue growth.

Compensation and benefits expense as a percentage of net revenues was 50.1% and
51.8% for the three and six months ended June 30, 2022, respectively, compared
to 53.5% and 53.4% for the comparable periods in 2021.

Occupancy and equipment rental - For the three months ended June 30, 2022,
occupancy and equipment rental expense increased 15.7% to $38.2 million from
$33.0 million during the comparable period in 2021. For the six months ended
June 30, 2022, occupancy and equipment rental expense increased 12.0% to $75.2
million from $67.1 million during the comparable period in 2021. The increase is
primarily attributable to higher data processing costs associated with an
increase in business activity.

Communications and office supplies - For the three months ended June 30, 2022,
communications and office supplies expense increased 3.6% to $15.0 million from
$14.5 million during the comparable period in 2021. For the six months ended
June 30, 2022, communications and office supplies expense increased 2.7% to
$29.7 million from $28.9 million during the comparable period in 2021. The
increase is primarily attributable to higher communication and quote equipment
expenses associated with the continued growth of our business.

Commissions and floor brokerage - For the three months ended June 30, 2022,
commissions and floor brokerage expense increased 15.1% to $6.8 million from
$5.9 million during the comparable period in 2021. For the six months ended June
30, 2022, commissions and floor brokerage expense increased 10.6% to $13.7
million from $12.4 million during the comparable period in 2021. The increase is
primarily attributable to higher processing expenses, partially offset by lower
ECN trading costs.

Provision for credit losses - For the three months ended June 30, 2022,
provision for credit losses increased to $12.8 million from a credit of $9.7
million during the comparable period in 2021. For the six months ended June 30,
2022, provision for credit losses increased to $21.0 million from a credit of
$14.9 million during the comparable period in 2021. The increase is primarily
attributable to the growth in our loan portfolio and the release of the
provision for credit losses during the comparable periods in 2021.

Other operating expenses - For the three months ended June 30, 2022, other
operating expenses increased 22.1% to $30.6 million from $25.1 million during
the comparable period in 2021. For the six months ended June 30, 2022, other
operating expenses increased 17.6% to $55.2 million from $47.0 million during
the comparable period in 2021. The increase is primarily attributable to
increases in settlement costs, subscriptions, FDIC-insurance expense, and
professional fees, partially offset by lower travel and entertainment and
conference-related expenses over the comparable periods in 2021.

INCOME BEFORE INCOME TAXES



For the three months ended June 30, 2022, income before income taxes increased
7.9% to $245.2 million from $227.3 million during the comparable period in 2021.
For the six months ended June 30, 2022, income before income taxes increased
4.4% to $470.6 million from $450.5 million during the comparable period in 2021.

Profit margins (income before income taxes as a percent of net revenues) have
decreased to 35.1% and 34.1% for the three and six months ended June 30, 2022,
respectively, from 35.7% and 35.5% during the comparable periods in 2021. Profit
margins were negatively impacted by the increase in the provision for credit
losses over the comparable periods in 2021 and positively impacted by the growth
in net revenues.

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Results of Operations - Institutional Group

Three Months Ended June 30, 2022 Compared with Three Months Ended June 30, 2021

The following table presents consolidated financial information for the Institutional Group segment for the periods indicated (in thousands, except percentages):



                                                                                As a Percentage of Net Revenues For
                                          Three Months Ended June 30,             the Three Months Ended June 30,
                                                                      %
                                         2022          2021        Change          2022                     2021
Revenues:
Commissions                           $   64,677     $  55,926        15.6             15.7 %                   10.7 %
Principal transactions                    77,137        97,388       (20.8 )           18.8                     18.7
Transactional revenues                   141,814       153,314        (7.5 )           34.5                     29.4
Capital raising                           66,463       157,880       (57.9 )           16.2                     30.3
Advisory                                 199,556       206,665        (3.4 )           48.5                     39.7
Investment banking                       266,019       364,545       (27.0 )           64.7                     70.0
Interest                                   6,209         3,493        77.8              1.5                      0.7
Other income                               1,203         2,399       (49.9 )            0.2                      0.5
Total revenues                           415,245       523,751       (20.7 )          100.9                    100.6
Interest expense                           3,881         2,940        32.0              0.9                      0.6
Net revenues                             411,364       520,811       (21.0 )          100.0                    100.0
Non-interest expenses:
Compensation and benefits                244,711       299,469       (18.3 )           59.5                     57.5
Occupancy and equipment rental            18,320        17,810         2.9              4.5                      3.4

Communication and office supplies 23,934 22,186 7.9

             5.8                      4.3
Commissions and floor brokerage            8,273         8,037         2.9              2.0                      1.5
Other operating expenses                  43,134        31,815        35.6             10.5                      6.1
Total non-interest expenses              338,372       379,317       (10.8 )           82.3                     72.8
Income before income taxes            $   72,992     $ 141,494       (48.4 )           17.7 %                   27.2 %





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Six months ended June 30, 2022 Compared with Six months ended June 30, 2021

The following table presents consolidated financial information for the Institutional Group segment for the periods indicated (in thousands, except percentages):



                                                                                 As a Percentage of Net Revenues For
                                            Six Months Ended June 30,               the Six Months Ended June 30,
                                                                       %
                                        2022           2021         Change          2022                     2021
Revenues:
Commissions                           $ 129,810     $   122,035         6.4             15.4 %                   11.9 %
Principal transactions                  190,863         208,795        (8.6 )           22.6                     20.3
Transactional revenues                  320,673         330,830        (3.1 )           38.0                     32.2
Capital raising                         134,766         353,137       (61.8 )           16.0                     34.4
Advisory                                380,952         337,147        13.0             45.2                     32.8
Investment banking                      515,718         690,284       (25.3 )           61.2                     67.2
Interest                                 11,482           7,308        57.1              1.4                      0.7
Other income                              1,792           4,250       (57.8 )            0.2                      0.5
Total revenues                          849,665       1,032,672       (17.7 )          100.8                    100.6
Interest expense                          6,938           5,780        20.0              0.8                      0.6
Net revenues                            842,727       1,026,892       (17.9 )          100.0                    100.0
Non-interest expenses:
Compensation and benefits               497,058         601,093       (17.3 )           59.0                     58.5
Occupancy and equipment rental           38,480          34,656        11.0              4.6                      3.4

Communication and office supplies 47,009 45,171 4.1

              5.6                      4.4
Commissions and floor brokerage          17,273          17,279        (0.0 )            2.0                      1.7
Other operating expenses                 73,287          70,011         4.7              8.7                      6.8
Total non-interest expenses             673,107         768,210       (12.4 )           79.9                     74.8
Income before income taxes            $ 169,620     $   258,682       (34.4 )           20.1 %                   25.2 %


NET REVENUES

For the three months ended June 30, 2022, Institutional Group net revenues
decreased 21.0% to $411.4 million from $520.8 million for the comparable period
in 2021. The decrease in net revenues is primarily attributable to lower
capital-raising revenues, equity transactional revenues, and advisory revenues,
partially offset by an increase in fixed income transactional revenues.

For the six months ended June 30, 2022, Institutional Group net revenues
decreased 17.9% to $842.7 million from $1.0 billion during the comparable period
in 2021. The decrease in net revenues is primarily attributable to lower
capital-raising revenues and equity transactional revenues, partially offset by
an increase in advisory revenues and fixed income transactional revenues.

Commissions - For the three months ended June 30, 2022, commission revenues
increased 15.6% to $64.7 million from $55.9 million in the comparable period in
2021. For the six months ended June 30, 2022, commission revenues increased 6.4%
to $129.8 million from $122.0 million in the comparable period in 2021.

Principal transactions - For the three months ended June 30, 2022, principal
transactions revenues decreased 20.8% to $77.1 million from $97.4 million in the
comparable period in 2021. For the six months ended June 30, 2022, principal
transaction revenues decreased 8.6% to $190.9 million from $208.8 million in the
comparable period in 2021.

Transactional revenues - For the three months ended June 30, 2022, institutional
transactional revenues decreased 7.5% to $141.8 million from $153.3 million in
the comparable period in 2021. For the six months ended June 30, 2022,
institutional transactional revenues decreased 3.1% to $320.7 million from
$330.8 million in the comparable period in 2021.

For the three months ended June 30, 2022, fixed income institutional
transactional revenues increased 4.7% to $96.2 million from $91.9 million in the
comparable period in 2021. For the six months ended June 30, 2022, fixed income
transactional revenues increased 14.8% to $218.5 million from $190.3 million in
the comparable period in 2021. The increase in fixed income institutional
transactional revenues is primarily attributable to revenues from the Vining
Sparks acquisition, partially offset by lower trading gains.

For the three months ended June 30, 2022, equity institutional transactional
revenues decreased 25.8% to $45.6 million from $61.5 million during the
comparable period in 2021. For the six months ended June 30, 2022, equity
transactional revenues decreased 27.3% to $102.2 million from $140.6 million
during the comparable period in 2021. The decline in equity institutional
transactional revenues is primarily attributable to trading losses and declines
in cash equities.

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Investment banking - For the three months ended June 30, 2022, investment banking revenues decreased 27.0% to $266.0 million from $364.5 million during the comparable period in 2021. For the six months ended June 30, 2022, investment banking revenues decreased 25.3% to $515.7 million from $690.3 million during the comparable period in 2021.



For the three months ended June 30, 2022, capital raising revenues decreased
57.9% to $66.5 million from $157.9 million in the comparable period in 2021. For
the six months ended June 30, 2022, capital raising revenues decreased 61.8% to
$134.8 million from $353.1 million in the comparable period in 2021.

For the three months ended June 30, 2022, equity capital raising revenues
decreased 74.6% to $26.0 million from $102.5 million during the comparable
period in 2021. For the six months ended June 30, 2022, equity capital raising
revenues decreased 77.8% to $55.4 million from $249.9 million during the
comparable period in 2021. The decrease is a result of lower issuances in line
with market volumes in an uncertain market environment.

For the three months ended June 30, 2022, fixed income capital raising revenues
decreased 27.0% to $40.5 million from $55.4 million during the comparable period
in 2021. For the six months ended June 30, 2022, fixed income capital raising
revenues decreased 23.2% to $79.3 million from $103.3 million during the
comparable period in 2021. The decrease is primarily attributable to lower bond
issuances as a result of the microeconomic conditions that existed during the
first half of 2022.

For the three months ended June 30, 2022, advisory revenues decreased 3.4% to
$199.6 million from $206.7 million in the comparable period in 2021. The
decrease is primarily attributable to lower levels of completed advisory
transactions during the quarter. For the six months ended June 30, 2022,
advisory revenues increased 13.0% to $381.0 million from $337.1 million in the
comparable period in 2021. The growth is primarily attributable to an increase
in completed advisory transactions compared with lower volumes during the
comparable period in 2021.

Interest - For the three months ended June 30, 2022, interest increased 77.8% to
$6.2 million from $3.5 million in the comparable period in 2021. For the six
months ended June 30, 2022, interest increased 57.1% to $11.5 million from $7.3
million in the comparable period in 2021. The increase is primarily attributable
to higher leveraged finance activity.

Other income - For the three months ended June 30, 2022, other income decreased
49.9% to $1.2 million from $2.4 million in the comparable period in 2021. For
the six months ended June 30, 2022, other income decreased 57.8% to $1.8 million
from $4.3 million during the comparable period in 2021. The decrease is
primarily attributable to a decrease in investment gains over the comparable
periods in 2021.

Interest expense - For the three months ended June 30, 2022, interest expense
increased 32.0% to $3.9 million from $2.9 million in the comparable period in
2021. For the six months ended June 30, 2022, interest expense increased 20.0%
to $6.9 million from $5.8 million in the comparable period in 2021. The increase
is primarily attributable to higher interest rates and an increase in inventory
levels.

NON-INTEREST EXPENSES

For the three months ended June 30, 2022, Institutional Group non-interest expenses decreased 10.8% to $338.4 million from $379.3 million for the comparable period in 2021. For the six months ended June 30, 2022, Institutional Group non-interest expenses decreased 12.4% to $673.1 million from $768.2 million during the comparable period in 2021.



Compensation and benefits - For the three months ended June 30, 2022,
compensation and benefits expense decreased 18.3% to $244.7 million from $299.5
million during the comparable period in 2021. For the six months ended June 30,
2022, compensation and benefits expense decreased 17.3% to $497.1 million from
$601.1 million during the comparable period in 2021. The decrease is driven by
lower compensable revenues.

Compensation and benefits expense as a percentage of net revenues was 59.5% and
59.0% for the three and six months ended June 30, 2022, respectively, compared
to 57.5% and 58.5% for the comparable periods in 2021 as a result of lower
compensable revenues.

Occupancy and equipment rental - For the three months ended June 30, 2022,
occupancy and equipment rental expense increased 2.9% to $18.3 million from
$17.8 million during the comparable period in 2021. For the six months ended
June 30, 2022, occupancy and equipment rental expense increased 11.0% to $38.5
million from $34.7 million during the comparable period in 2021. The increase is
attributable to higher data processing costs associated with an increase in
business activity.

Communications and office supplies - For the three months ended June 30, 2022,
communications and office supplies expense increased 7.9% to $23.9 million from
$22.2 million during the comparable period in 2021. For the six months ended
June 30, 2022, communications and office supplies expense increased 4.1% to
$47.0 million from $45.2 million during the comparable period in 2021. The
increase is primarily attributable to higher communication and quote expenses,
partially offset by lower telecommunication expenses.

Commissions and floor brokerage - For the three months ended June 30, 2022,
commissions and floor brokerage expense increased 2.9% to $8.3 million from $8.0
million during the comparable period in 2021. The increase was primarily
attributable to higher processing expenses, partially offset by lower clearing
expenses during the quarter. For the six months ended June 30, 2022, commissions
and floor brokerage expense remained relatively consistent with the comparable
period in 2021 at $17.3 million.

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Other operating expenses - For the three months ended June 30, 2022, other
operating expenses increased 35.6% to $43.1 million from $31.8 million during
the comparable period in 2021. For the six months ended June 30, 2022, other
operating expenses increased 4.7% to $73.3 million from $70.0 million during the
comparable period in 2021. The increases are primarily attributable to higher
travel and entertainment expenses, conference-related expenses, and
litigation-related expenses, partially offset by lower investment banking
transaction expenses.

INCOME BEFORE INCOME TAXES



For the three months ended June 30, 2022, income before income taxes for the
Institutional Group segment decreased 48.4% to $73.0 million from $141.5 million
during the comparable period in 2021. For the six months ended June 30, 2022,
income before income taxes for the Institutional Group segment decreased 34.4%
to $169.6 million from $258.7 million during the comparable period in 2021.

Profit margins (income before income taxes as a percentage of net revenues) have
decreased to 17.7% and 20.1% for the three and six months ended June 30, 2022,
respectively, from 27.2% and 25.2% during the comparable periods in 2021 as a
result of lower revenues growth, partially offset by a decrease in expenses.

Results of Operations - Other Segment

Three and Six months ended June 30, 2022 Compared with Three and Six months ended June 30, 2021

The following table presents consolidated financial information for the Other segment for the periods presented (in thousands, except percentages):



                                       Three Months Ended June 30,          

Six Months Ended June 30,


                                   2022           2021         % Change          2022           2021         % Change
Net revenues                     $  (1,218 )   $   (5,242 )         76.8      $    2,221     $   (8,029 )        127.7
Non-interest expenses:
Compensation and benefits           58,629         51,218           14.5         114,981        110,787            3.8
Other operating expenses            39,756         48,314          (17.7 )        81,775         98,485          (17.0 )
Total non-interest expenses         98,385         99,532           (1.2 )       196,756        209,272           (6.0 )

Loss before income taxes $ (99,603 ) $ (104,774 ) (4.9 )%

$ (194,535 ) $ (217,301 ) (10.5 )%

The Other segment includes expenses related to the Company's acquisition strategy and the investments made in the Company's infrastructure and control environment.



The expenses relating to the Company's acquisition strategy are primarily
attributable to integration-related activities, signing bonuses, amortization of
restricted stock awards, debentures, and promissory notes issued as retention,
additional earn-out expense, and amortization of intangible assets acquired.
These costs were directly related to acquisitions of certain businesses and are
not representative of the costs of running the Company's ongoing business.

The following shows the expenses that are part of the Other segment related to acquisitions.



                                       Three Months Ended June 30,          

Six Months Ended June 30,


                                    2022           2021        % Change        2022          2021        % Change
Non-interest expenses:
Compensation and benefits        $    9,174      $  6,119           49.9     $  18,485     $ 12,293           50.4
Other operating expenses              7,617        10,287          (26.0 )      13,098       19,351          (32.3 )
Total non-interest expenses      $   16,791      $ 16,406            2.3 %   $  31,583     $ 31,644           (0.2 )%


For the three months ended June 30, 2022, compensation and benefits expense
increased 49.9% to $9.2 million from $6.1 million in 2021. For the six months
ended June 30, 2022, compensation and benefits expense increased 50.4% to $18.5
million from $12.3 million in 2021.

For the three months ended June 30, 2022, other operating expenses decreased
26.0% to $7.6 million from $10.3 million in 2021. For the six months ended June
30, 2022, other operating expenses decreased 32.3% to $13.1 million from $19.4
million in 2021.


The expenses not associated with the activities described above in the Other segment are as follows:



                                       Three Months Ended June 30,          

Six Months Ended June 30,


                                    2022           2021        % Change         2022          2021         % Change
Non-interest expenses:
Compensation and benefits        $   49,455      $ 45,099            9.7      $  96,496     $  98,494           (2.0 )
Other operating expenses             32,139        38,027          (15.5 )       68,677        79,134          (13.2 )
Total non-interest expenses      $   81,594      $ 83,126           (1.8 )%   $ 165,173     $ 177,628           (7.0 )%




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For the three months ended June 30, 2022, compensation and benefits expense
increased 9.7% to $49.5 million from $45.1 million in 2021. For the six months
ended June 30, 2022, compensation and benefits expense decreased 2.0% to $96.5
million from $98.5 million in 2021.

For the three months ended June 30, 2022, other operating expenses decreased
15.5% to $32.1 million from $38.0 million in 2021. For the six months ended June
30, 2022, other operating expenses decreased 13.2% to $68.7 million from $79.1
million in 2021.

Analysis of Financial Condition



Our company's consolidated statements of financial condition consist primarily
of cash and cash equivalents, receivables, financial instruments owned, bank
loans, investments, goodwill, loans and advances to financial advisors, bank
deposits, and payables. Total assets of $36.5 billion, were up 7.1% over
December 31, 2021. Our broker-dealer subsidiary's gross assets and liabilities,
including financial instruments owned, stock loan/borrow, receivables and
payables from/to brokers, dealers, and clearing organizations and clients,
fluctuate with our business levels and overall market conditions.

As of June 30, 2022, our liabilities were comprised primarily of deposits of
$26.0 billion at Stifel Bancorp, payables to customers of $866.1 million at our
broker-dealer subsidiaries, accounts payable and accrued expenses of $1.2
billion, senior notes, net of debt issuance costs, of $1.1 billion, and accrued
employee compensation of $475.9 million. To meet our obligations to clients and
operating needs, we had $11.5 billion of cash or assets readily convertible into
cash at June 30, 2022.

Cash Flow

Cash and cash equivalents decreased $385.6 million to $1.6 billion at June 30,
2022, from $2.0 billion at December 31, 2021. Operating activities used cash of
$200.5 million. Investing activities used cash of $2.9 billion due to the growth
of the loan portfolio, investment securities purchases, and fixed asset
purchases, partially offset by proceeds from the sale and maturity of securities
in our investment portfolio. Financing activities provided cash of $2.6 billion
primarily due to an increase in bank deposits and securities loaned, partially
offset by dividends paid on our common and preferred stock, tax payments related
to shares withheld for stock-based compensation, and repurchases of our common
stock.

Liquidity and Capital Resources



The Company's senior management establishes the liquidity and capital policies
of our company. The Company's senior management reviews business performance
relative to these policies, monitors the availability of alternative sources of
financing, and oversees the liquidity and interest rate sensitivity of our
company's asset and liability position.

Our assets, consisting mainly of cash or assets readily convertible into cash,
are our principal source of liquidity. The liquid nature of these assets
provides for flexibility in managing and financing the projected operating needs
of the business. These assets are financed primarily by our equity capital,
corporate debt, debentures to trusts, client credit balances, short-term bank
loans, and proceeds from securities lending, repurchase agreements, and other
payables. We currently finance our client accounts and firm trading positions
through ordinary course borrowings at floating interest rates from various banks
on a demand basis, securities lending, and repurchase agreements, with
company-owned and client securities pledged as collateral. Changes in securities
market volumes, related client borrowing demands, underwriting activity, and
levels of securities inventory affect the amount of our financing requirements.

Our bank assets consist principally of available-for-sale and held-to-maturity
securities, retained loans, and cash and cash equivalents. Stifel Bancorp's
current liquidity needs are generally met through deposits from brokerage
clients and equity capital. We monitor the liquidity of our bank subsidiaries
daily to ensure their ability to meet customer deposit withdrawals, maintain
reserve requirements, and support asset growth.

As of June 30, 2022, we had $36.5 billion in assets, $11.5 billion of which
consisted of cash or assets readily convertible into cash as follows (in
thousands):

                                                     June 30, 2022       December 31, 2021
Cash and cash equivalents                           $     1,577,677     $         1,963,326
Receivables from brokers, dealers, and clearing
organizations                                               377,741         

574,256


Securities purchased under agreements to resell             608,051         

579,866


Financial instruments owned at fair value                 1,124,621         

1,065,216


Available-for-sale securities at fair value               1,879,904         

2,113,893


Held-to-maturity securities at amortized cost             5,883,448         

5,348,558


Investments                                                  38,914         

34,340

Total cash and assets readily convertible to cash $ 11,490,356 $


     11,679,455




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As of June 30, 2022 and December 31, 2021, the amount of collateral by asset class is as follows (in thousands):



                                        June 30, 2022                     December 31, 2021
                                Contractual        Contingent        Contractual      Contingent
Cash and cash equivalents      $     161,223     $            -     $     132,158     $         -
Financial instruments owned at
fair value                           350,206            350,206           385,528         385,528
Investment portfolio (AFS &
HTM)                                       -          1,929,485                 -       1,849,152
                               $     511,429     $    2,279,691     $     517,686     $ 2,234,680

Liquidity Available From Subsidiaries

Liquidity is principally available to our company from Stifel and Stifel Bancorp.



Stifel is required to maintain net capital equal to the greater of $1 million or
two percent of aggregate debit items arising from client transactions. Covenants
in the Company's committed financing facilities require the excess net capital
of Stifel, our principal broker-dealer subsidiary, to be above a defined amount.
At June 30, 2022, Stifel's excess net capital exceeded the minimum requirement,
as defined. There are also limitations on the amount of dividends that may be
declared by a broker-dealer without FINRA approval. See Note 15 of the Notes to
Consolidated Financial Statements for more information on the capital
restrictions placed on our broker-dealer subsidiaries.

Stifel Bancorp may pay dividends to the parent company without prior approval by
its regulator as long as the dividend does not exceed the sum of Stifel
Bancorp's current calendar year and the previous two calendar years' retained
net income and Stifel Bancorp maintains its targeted capital to risk-weighted
assets ratios.

Although we have liquidity available to us from our other subsidiaries, the available amounts are not as significant as the amounts described above and, in certain instances, may be subject to regulatory requirements.

Capital Management



We have an ongoing authorization from the Board of Directors to repurchase our
common stock in the open market or in negotiated transactions. At June 30, 2022,
the maximum number of shares that may yet be purchased under this plan was 10.3
million. We utilize the share repurchase program to manage our equity capital
relative to the growth of our business and help to meet obligations under our
employee benefit plans.

Liquidity Risk Management



Our businesses are diverse, and our liquidity needs are determined by many
factors, including market movements, collateral requirements, and client
commitments, all of which can change dramatically in a difficult funding
environment. During a liquidity crisis, credit-sensitive funding, including
unsecured debt and some types of secured financing agreements, may be
unavailable, and the terms (e.g., interest rates, collateral provisions, and
tenor) or availability of other types of secured financing may change. We manage
liquidity risk by diversifying our funding sources across products and among
individual counterparties within those products.

As a holding company, whereby all of our operations are conducted through our
subsidiaries, our cash flow and our ability to service our debt, including the
notes, depend upon the earnings of our subsidiaries. Our subsidiaries are
separate and distinct legal entities. Our subsidiaries have no obligation to pay
any amounts due on the notes or to provide us with funds to pay our obligations,
whether by dividends, distributions, loans, or other payments.

Our liquidity requirements may change in the event we need to raise more funds
than anticipated to increase inventory positions, support more rapid expansion,
develop new or enhanced services and products, acquire technologies, respond to
acquisition opportunities, expand our recruiting efforts, or respond to other
unanticipated liquidity requirements. We primarily rely on financing activities
and distributions from our subsidiaries for funds to implement our business and
growth strategies and repurchase our shares. Net capital rules, restrictions
under our borrowing arrangements of our subsidiaries, as well as the earnings,
financial condition, and cash requirements of our subsidiaries, may each limit
distributions to us from our subsidiaries.

The availability of outside financing, including access to the capital markets
and bank lending, depends on a variety of factors, such as market conditions,
the general availability of credit, the volume of trading activities, the
overall availability of credit to the financial services sector, and our credit
rating. Our cost and availability of funding may be adversely affected by
illiquid credit markets and wider credit spreads. As a result of any future
concerns about the stability of the markets generally and the strength of
counterparties specifically, lenders may from time to time curtail, or even
cease to provide, funding to borrowers.

Our liquidity management policies are designed to mitigate the potential risk that we may be unable to access adequate financing to service our financial obligations without material business impact. The principal elements of our liquidity management framework are:


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(a) daily monitoring of our liquidity needs at the holding company and significant subsidiary level, (b) stress testing the liquidity positions of Stifel and our bank subsidiaries, and (c) diversification of our funding sources.



Monitoring of liquidity - Senior management establishes our liquidity and
capital policies. These policies include senior management's review of short-
and long-term cash flow forecasts, review of monthly capital expenditures, the
monitoring of the availability of alternative sources of financing, and the
daily monitoring of liquidity in our significant subsidiaries. Our decisions on
the allocation of capital to our business units consider, among other factors,
projected profitability and cash flow, risk, and impact on future liquidity
needs. Our treasury department assists in evaluating, monitoring, and
controlling the impact that our business activities have on our financial
condition, liquidity, and capital structure as well as maintains our
relationships with various lenders. The objectives of these policies are to
support the successful execution of our business strategies while ensuring
ongoing and sufficient liquidity.

Liquidity stress testing (Firmwide) -A liquidity stress test model is maintained
by the Company that measures liquidity outflows across multiple scenarios at the
major operating subsidiaries and details the corresponding impact to our holding
company and the overall consolidated firm. Liquidity stress tests are utilized
to ensure that current exposures are consistent with the Company's established
liquidity risk tolerance and, more specifically, to identify and quantify
sources of potential liquidity strain. Further, the stress tests are utilized to
analyze possible impacts on the Company's cash flows, and liquidity position.
The outflows are modeled over a 30-day liquidity stress timeframe and include
the impact of idiosyncratic and macro-economic stress events.

The assumptions utilized in the Company's liquidity stress tests include, but are not limited to, the following:

No government support

No access to equity and unsecured debt markets within the stress horizon

Higher haircuts and significantly lower availability of secured funding

Additional collateral that would be required by trading counter-parties, certain exchanges, and clearing organizations related to credit rating downgrades

Client cash withdrawals and inability to accept new deposits

Increased demand from customers on the funding of loans and lines of credit

At June 30, 2022, the Company maintained sufficient liquidity to meet current and contingent funding obligations as modeled in its liquidity stress test model.



Liquidity stress testing (Stifel Bancorp) - Our bank subsidiaries perform three
primary stress tests on their liquidity position. These stress tests are based
on the following company-specific stresses: (1) the amount of deposit run-off
that they could withstand over a one-month period of time based on their
on-balance sheet liquidity and available credit, (2) the ability to fund
operations if all available credit were to be drawn immediately, with no
additional available credit, and (3) the ability to fund operations under a
regulatory prompt corrective action. The goal of these stress tests is to
determine their ability to fund continuing operations under significant
pressures on both assets and liabilities.

Under all stress tests, our bank subsidiaries consider cash and highly liquid
investments as available to meet liquidity needs. In their analysis, our bank
subsidiaries consider agency mortgage-backed securities, corporate bonds, and
commercial mortgage-backed securities as highly liquid. In addition to being
able to be readily financed at modest haircut levels, our bank subsidiaries
estimate that each of the individual securities within each of the asset classes
described above could be sold into the market and converted into cash within
three business days under normal market conditions, assuming that the entire
portfolio of a given asset class was not simultaneously liquidated. At June 30,
2022, available cash and highly liquid investments comprised approximately 17%
of Stifel Bancorp's assets, which was well in excess of its internal target.

In addition to these stress tests, management performs a daily liquidity review.
The daily analysis provides management with all major fluctuations in liquidity.
The analysis also tracks the proportion of deposits that Stifel Bancorp is
sweeping from its affiliated broker-dealer, Stifel. On a monthly basis,
liquidity key performance indicators and compliance with liquidity policy limits
are reported to the Board of Directors. Our bank subsidiaries have not violated
any internal liquidity policy limits.

Funding Sources



The Company pursues a strategy of diversification of secured and unsecured
funding sources (by product and by investor) and attempts to ensure that the
tenor of the Company's liabilities equals or exceeds the expected holding period
of the assets being financed. The Company funds its balance sheet through
diverse sources. These sources may include the Company's equity capital,
long-term debt, repurchase agreements, securities lending, deposits, committed
and uncommitted credit facilities, Federal Home Loan Bank advances, and federal
funds agreements.

Cash and Cash Equivalents - We held $1.6 billion of cash and cash equivalents at June 30, 2022, compared to $2.0 billion at December 31, 2021. Cash and cash equivalents provide immediate sources of funds to meet our liquidity needs.


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Available-for-Sale Securities - We held $1.9 billion in available-for-sale
investment securities at June 30, 2022, compared to $2.1 billion at December 31,
2021. As of June 30, 2022, the weighted-average life of the investment
securities portfolio was approximately 1.5 years. These investment securities
provide increased liquidity and flexibility to support our company's funding
requirements.

We monitor the available-for-sale investment portfolio for other-than-temporary
impairment based on a number of criteria, including the size of the unrealized
loss position, the duration for which the security has been in a loss position,
credit rating, the nature of the investments, and current market conditions. For
debt securities, we also consider any intent to sell the security and the
likelihood we will be required to sell the security before its anticipated
recovery. We continually monitor the ratings of our security holdings and
conduct regular reviews of our credit-sensitive assets.

Deposits - Deposits have become our largest funding source. Deposits provide a
stable, low-cost source of funds that we utilize to fund asset growth and to
diversify funding sources. We have continued to expand our deposit-gathering
efforts through our existing private client network and through expansion. These
channels offer a broad set of deposit products that include demand deposits,
money market deposits, and certificates of deposit ("CDs").

As of June 30, 2022, we had $26.0 billion in deposits compared to $23.3 billion
at December 31, 2021. Our core deposits are primarily comprised of money market
deposit accounts, non-interest-bearing deposits, and CDs.

Short-term borrowings - Our short-term financing is generally obtained through
short-term bank line financing on an uncommitted, secured basis, securities
lending arrangements, repurchase agreements, advances from the Federal Home Loan
Bank, term loans, and committed bank line financing on an unsecured basis. We
borrow from various banks on a demand basis with company-owned and customer
securities pledged as collateral. The value of customer-owned securities used as
collateral is not reflected in the consolidated statements of financial
condition. We also have an unsecured, committed bank line available.

Our uncommitted secured lines of credit at June 30, 2022, totaled $880.0 million
with four banks and are dependent on having appropriate collateral, as
determined by the bank agreements, to secure an advance under the line. The
availability of our uncommitted lines is subject to approval by the individual
banks each time an advance is requested and may be denied. Our peak daily
borrowing on our uncommitted secured lines was $85.0 million during the six
months ended June 30, 2022. There are no compensating balance requirements under
these arrangements. Any borrowings on secured lines of credit are generally
utilized to finance certain fixed income securities. At June 30, 2022, we had no
outstanding balances on our uncommitted secured lines of credit.

Federal Home Loan advances are floating-rate advances. The weighted average
interest rates during the three and six months ended June 30, 2022 on these
advances was 0.86% and 0.80%, respectively. The advances are secured by Stifel
Bancorp's residential mortgage loan portfolio and investment portfolio. The
interest rates reset on a daily basis. Stifel Bancorp has the option to prepay
these advances without penalty on the interest reset date. At June 30, 2022,
there were no Federal Home Loan advances.

Unsecured borrowings - On May 27, 2021, the Company and Stifel entered into an
unsecured revolving credit facility agreement (the "Credit Facility"). The
Credit Facility has a maturity date of May 2026 and the lenders include a number
of financial institutions. This committed unsecured borrowing facility provides
for maximum borrowings of up to $500.0 million, with a sublimit of $200.0
million for the Company. Stifel may borrow up to $500.0 million under the Credit
Facility, depending on the amount of outstanding borrowings of the Company. The
interest rates on borrowings under the Credit Facility are variable and based on
LIBOR, as adjusted. There were no borrowings outstanding on the Credit Facility
as of June 30, 2022.

We can draw upon this line as long as certain restrictive covenants are
maintained. Under the Credit Facility, we are required to maintain compliance
with a minimum consolidated tangible net worth covenant, as defined, and a
maximum consolidated total capitalization ratio covenant, as defined. In
addition, Stifel, our broker-dealer subsidiary, is required to maintain
compliance with a minimum regulatory excess net capital percentage covenant, as
defined, and our bank subsidiaries are required to maintain their status as
well-capitalized, as defined.

Our revolving credit facility contains customary events of default, including,
without limitation, payment defaults, breaches of representations and
warranties, covenant defaults, cross-defaults to similar obligations, certain
events of bankruptcy and insolvency, and judgment defaults. At June 30, 2022, we
had no advances on the Credit Facility and were in compliance with all covenants
and currently do not expect any covenant violations.

Federal Home Loan Bank Advances and other secured financing - Stifel Bancorp has
borrowing capacity with the Federal Home Loan Bank of $5.1 billion at June 30,
2022 and $64.5 million in federal funds agreements for the purpose of purchasing
short-term funds should additional liquidity be needed. At June 30, 2022, there
were no outstanding Federal Home Loan Bank advances. Stifel Bancorp is eligible
to participate in the Fed's discount window program; however, Stifel Bancorp
does not view borrowings from the Fed as a primary means of funding. The credit
available in this program is subject to periodic review, may be terminated or
reduced at the discretion of the Fed, and is secured by securities. Stifel
Bancorp has borrowing capacity of $1.2 billion with the Fed's discount window at
June 30, 2022. Stifel Bancorp receives overnight funds from excess cash held in
Stifel brokerage accounts, which are deposited into a money market account.
These balances totaled $23.8 billion at June 30, 2022. At June 30, 2022, there
was $26.8 billion in client money market and FDIC-insured product balances.

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Public Offering of Senior Notes - On July 15, 2014, we sold in a registered
underwritten public offering, $300.0 million in aggregate principal amount of
4.25% senior notes due July 2024 (the "2014 Notes"). Interest on the 2014 Notes
is payable semi-annually in arrears. We may redeem the 2014 Notes in whole or in
part, at our option, at a redemption price equal to 100% of their principal
amount, plus a "make-whole" premium and accrued and unpaid interest, if any, to
the date of redemption. In July 2016, we issued an additional $200.0 million in
aggregate principal amount of 4.25% senior notes due 2024.

On October 4, 2017, we completed the pricing of a registered underwritten public
offering of $200.0 million in aggregate principal amount of 5.20% senior notes
due October 2047. Interest on the senior notes is payable quarterly in arrears
in January, April, July, and October. On or after October 15, 2022, we may
redeem some or all of the senior notes at any time at a redemption price equal
to 100% of the principal amount of the notes being redeemed plus accrued
interest thereon to the redemption date. On October 27, 2017, we completed the
sale of an additional $25.0 million aggregate principal amount of Notes pursuant
to the over-allotment option. In October 2017, we received a BBB- rating on the
notes.

On May 20, 2020, we sold in a registered underwritten public offering, $400.0
million in aggregate principal amount of 4.00% senior notes due May 2030.
Interest on these senior notes is payable semi-annually in arrears in May and
November. We may redeem the notes in whole or in part, at our option, at a
redemption price equal to the greater of a) 100% of their principal amount or b)
discounted present value at Treasury rate plus 50 basis points prior to February
15, 2030, and on or after February 15, 2030, at 100% of their principal amount,
and accrued and unpaid interest, if any, to the date of redemption. In May 2020,
we received a BBB- rating on the notes.

Public Offering of Preferred Stock - In July 2016, the Company completed an
underwritten registered public offering of $150.0 million 6.25% Non-Cumulative
Perpetual Preferred Stock, Series A. On August 20, 2021, the Company redeemed
all of the outstanding Series A Preferred Stock.

In February 2019, the Company completed an underwritten registered public offering of $150.0 million 6.25% Non-Cumulative Perpetual Preferred Stock, Series B. In March 2019, we completed a public offering of an additional $10.0 million of Series B Preferred, pursuant to the over-allotment option.



In May 2020, the Company completed an underwritten registered public offering of
$225.0 million 6.125% Non-Cumulative Perpetual Preferred Stock, Series C, which
included the sale of $25.0 million of Series C Preferred pursuant to an
over-allotment option.

On July 22, 2021, the Company completed an underwritten registered public
offering of $300.0 million of 4.50% Non-Cumulative Perpetual Preferred Stock,
Series D. When, as, and if declared by the board of directors of the Company,
dividends will be payable at an annual rate of 4.50%, payable quarterly, in
arrears. The Company may redeem the Series D preferred stock at its option,
subject to regulatory approval, on or after August 15, 2026.

Credit Rating



We believe our current rating depends upon a number of factors, including
industry dynamics, operating and economic environment, operating results,
operating margins, earnings trends and volatility, balance sheet composition,
liquidity and liquidity management, our capital structure, our overall risk
management, business diversification, and our market share and competitive
position in the markets in which we operate. Deteriorations in any of these
factors could impact our credit rating. A reduction in our credit rating could
adversely affect our liquidity and competitive position, increase our
incremental borrowing costs, limit our access to the capital markets, or trigger
our obligations under certain financial agreements. As such, we may not be able
to successfully obtain additional outside financing to fund our operations on
favorable terms, or at all.

We believe our existing assets, a significant portion of which are liquid in
nature, together with the funds from operations, available informal short-term
credit arrangements, and our ability to raise additional capital will provide
sufficient resources to meet our present and anticipated financing needs.

Use of Capital Resources



We have paid $83.2 million in the form of upfront notes to financial advisors
for transition pay during the six months ended June 30, 2022. As we continue to
take advantage of the opportunities created by market displacement and as
competition for skilled professionals in the industry increases, we may decide
to devote more significant resources to attracting and retaining qualified
personnel.

We utilize transition pay, principally in the form of upfront demand notes, to
aid financial advisors, who have elected to join our firm, to supplement their
lost compensation while transitioning their customers' accounts to the Stifel
platform. The initial value of the notes is determined primarily by the
financial advisors' trailing production and assets under management. These notes
are generally forgiven over a five- to ten-year period based on production. The
future estimated amortization expense of the upfront notes, assuming
current-year production levels and static growth for the remaining six months in
2022, and the years ended December 31, 2023, 2024, 2025, 2026, and thereafter
are $83.7 million, $125.2 million, $108.6 million, $86.9 million, $78.1 million,
and $190.6 million, respectively. These estimates could change if we continue to
grow our business through expansion or experience increased production levels.

We maintain an incentive stock plan and a wealth accumulation plan that provides
for the granting of stock options, stock appreciation rights, restricted stock,
performance awards, stock units, and debentures (collectively, "deferred
awards") to our associates. Historically,

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we have granted stock units to our associates as part of our retention program.
A restricted stock unit or restricted stock award represents the right to
receive a share of the Company's common stock at a designated time in the future
without cash payment by the associate and is issued in lieu of cash incentive,
principally for deferred compensation and employee retention plans. The
restricted stock units or restricted stock awards generally vest over the next
one to ten years after issuance and are distributed at predetermined future
payable dates once vesting occurs. Restricted stock awards are restricted as to
sale or disposition. These restrictions lapse over the next one to four years.

At June 30, 2022, the total number of restricted stock units, PRSUs, and restricted stock awards outstanding was 18.2 million, of which 15.7 million were unvested. At June 30, 2022, there was unrecognized compensation cost for deferred awards of approximately $770.0 million, which is expected to be recognized over a weighted-average period of 1.8 years.



The future estimated compensation expense of the deferred awards, assuming
current year forfeiture levels and static growth for the remaining six months in
2022, and the years ended December 31, 2023, 2024, 2025, 2026, and thereafter
are $115.7 million, $200.0 million, $171.3 million, $132.8 million, $91.8
million, and $58.4 million, respectively. These estimates could change if our
forfeitures change from historical levels.

Net Capital Requirements - We operate in a highly regulated environment and are
subject to capital requirements, which may limit distributions to our company
from our subsidiaries. Distributions from our broker-dealer subsidiaries are
subject to net capital rules. These subsidiaries have historically operated in
excess of minimum net capital requirements. However, if distributions were to be
limited in the future due to the failure of our subsidiaries to comply with the
net capital rules or a change in the net capital rules, it could have a material
and adverse effect to our company by limiting our operations that require
intensive use of capital, such as underwriting or trading activities, or limit
our ability to implement our business and growth strategies, pay interest on and
repay the principal of our debt, and/or repurchase our common stock. Our
non-broker-dealer subsidiaries, Stifel Bank & Trust, Stifel Bank, Stifel Trust
Company, N.A., and Stifel Trust Company Delaware, N.A., are also subject to
various regulatory capital requirements administered by the federal banking
agencies. Our broker-dealer subsidiaries and our bank subsidiaries have
consistently operated in excess of their capital adequacy requirements. Our
Canadian subsidiary, SNC, is subject to the regulatory supervision and
requirements of IIROC.

At June 30, 2022, Stifel had net capital of $627.1 million, which was 41.0% of
aggregate debit items and $596.5 million in excess of its minimum required net
capital. At June 30, 2022, all of our other broker-dealer subsidiaries' net
capital exceeded the minimum net capital required under the SEC rule. At June
30, 2022, SNEL's capital and reserves were in excess of the financial resources
requirement under the rules of the FCA. At June 30, 2022, our banking
subsidiaries were considered well capitalized under the regulatory framework for
prompt corrective action. At June 30, 2022, SNC's net capital and reserves were
in excess of the financial resources requirement under the rules of the IIROC.
See Note 15 of the Notes to Consolidated Financial Statements for details of our
regulatory capital requirements.

Critical Accounting Policies and Estimates



In preparing our consolidated financial statements in accordance with U.S.
generally accepted accounting principles and pursuant to the rules and
regulations of the SEC, we make assumptions, judgments, and estimates that
affect the reported amounts of assets, liabilities, revenues, and expenses, and
related disclosures of contingent assets and liabilities. We base our
assumptions, judgments, and estimates on historical experience and various other
factors that we believe to be reasonable under the circumstances. Actual results
could differ materially from these estimates under different assumptions or
conditions. On a regular basis, we evaluate our assumptions, judgments, and
estimates. We also discuss our critical accounting policies and estimates with
the Audit Committee of the Board of Directors.

We believe that the assumptions, judgments, and estimates involved in the
accounting policies described below have the greatest potential impact on our
consolidated financial statements. These areas are key components of our results
of operations and are based on complex rules that require us to make
assumptions, judgments, and estimates, so we consider these to be our critical
accounting policies. Historically, our assumptions, judgments, and estimates
relative to our critical accounting policies and estimates have not differed
materially from actual results.

For more information, see Note 2 of the Notes to Consolidated Financial
Statements in our Annual Report on Form 10-K for the year ended December 31,
2021. There have not been any material updates to our critical accounting
policies and estimates as disclosed in the MD&A of the Company's Annual Report
on Form 10-K.

Recent Accounting Pronouncements

See Note 2 of the Notes to Consolidated Financial Statements for information regarding the effect of new accounting pronouncements on our consolidated financial statements.

Off-Balance Sheet Arrangements



Information concerning our off-balance sheet arrangements is included in Note 20
of the Notes to Consolidated Financial Statements. Such information is hereby
incorporated by reference.

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Contractual Obligations

Our contractual obligations have not materially changed from those reported in our Annual Report on Form 10-K for the year ended December 31, 2021.

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