Federated Investors, Inc. Provides Update on Mutual Fund Investigation

(PITTSBURGH, Pa., 01/24/2005 10:51 AM) — Federated Investors, Inc. (NYSE: FII) today announced that it is involved in discussions with the Securities and Exchange Commission (SEC) and the Office of the New York State Attorney General to resolve issues raised by past mutual fund trading activities. The Company reported these activities in previous press releases and filings. The Company is cooperating with the SEC and Attorney General in the investigation. Federated also has been informed that the staff of the SEC is in the process of determining whether to recommend the initiation of civil enforcement action against two Company officers who were sanctioned by Federated as a result of its investigation into mutual fund trading activities as was previously reported by the Company.

Federated Investors, Inc. is one of the largest investment managers in the United States, managing $178 billion in over 135 mutual funds and various separately managed accounts as of September 30, 2004. Federated provides comprehensive investment management to 5,800 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. For more information, visit www.federatedinvestors.com.