8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

_________________________

FORM 8-K

_________________________

CURRENT REPORT
Pursuant To Section 13 OR 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  May 9, 2016

_________________________

STIFEL FINANCIAL CORP.

(Exact name of registrant as specified in its charter)

_________________________

Delaware
(State of incorporation)   001-09305
(Commission File Number)   43-1273600
(IRS Employer
Identification No.)  

501 N. Broadway, St. Louis, Missouri  63102-2188

(Address of principal executive offices and zip code)

(314) 342-2000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

1

Item 2.02  Results of Operations and Financial Condition.

On May 9, 2016, Stifel Financial Corp. (“Stifel”) will report its financial results for the three months ended March 31, 2016. A copy of the related press release is attached hereto as Exhibit 99.1.

Stifel will hold a conference call on Monday, May 9, 2016, at 5:00 p.m. Eastern time. All interested parties are invited to listen to Stifel Chairman and CEO, Ronald J. Kruszewski, by dialing (877) 876-9938 and referencing conference ID #88960277. A live audio webcast of the call, as well as a presentation highlighting the company’s results, will be available through Stifel's web site, www.stifel.com. For those who cannot listen to the live broadcast, a replay of the broadcast will be available through the above-referenced web site beginning approximately one hour following the completion of the call. The conference call slide show is attached hereto as Exhibit 99.2

The exhibits are being furnished pursuant to Item 2.02, and the information contained therein shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01  Financial Statements and Exhibits.

(d)  Exhibits.

Exhibit NumberDescription of Exhibit

99.1	Press release dated May 9, 2016.
99.2	Investor presentation.

2

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

STIFEL FINANCIAL CORP.

Date:  May 9, 2016	By:	/s/ James M. Zemlyak
	Name:	James M. Zemlyak
	Title:	President and Chief Financial Officer

3

EXHIBIT INDEX

Exhibit NumberDescription of Exhibit

99.1	Press release dated May 9, 2016.
99.2	Investor presentation.

4

EX-99.1

FOR IMMEDIATE RELEASE

STIFEL REPORTS FIRST QUARTER 2016 FINANCIAL RESULTS

Quarterly Highlights

· Net revenues of $620.0 million, increased 10.5% compared with the year-ago quarter.

· Net income of $27.1 million, or $0.36 per diluted common share, a 37.2% decline from the year ago quarter.

· Non-GAAP net income of $43.4 million, or $0.57 per diluted common share.

ST. LOUIS, May 9, 2016 – Stifel Financial Corp. (NYSE: SF) today reported net income of $27.1 million, or $0.36 per diluted common share on net revenues of $620.0 million for the three months ended March 31, 2016, compared with net income of $43.1 million, or $0.56 per diluted common share, on net revenues of $561.0 million for the first quarter of 2015.

For the three months ended March 31, 2016, the Company reported non-GAAP net income of $43.4 million, or $0.57 per diluted common share, compared with non-GAAP net income of $49.9 million, or $0.65 per diluted common share for the first quarter of 2015. These non-GAAP results primarily exclude merger-related expenses associated with the Company’s acquisitions.

Chairman’s Comments

“The diversity of Stifel’s business model that has evolved through both organic growth and acquisitions was highlighted in the quarter as the firm generated record quarterly revenue and sequential improvement in EPS. The growth in our private client business, Stifel Bank & Trust, and our institutional fixed income business more than offset the negative impact that increased market volatility had on the  equity capital markets business during the quarter,” stated Ronald J. Kruszewski, Chairman and CEO of Stifel.  

“After a year of substantial investment into the business, we began to realize some of the benefits of these growth initiatives as the scale of our operations continued to increase during the first quarter of 2016. That said, we remain committed to optimizing our current capital base, managing our expense base, and taking the necessary steps to achieve our key financial targets.”

Summary Results of Operations (Unaudited)
	Three Months Ended
(in 000s)	3/31/16		3/31/15		% Change			12/31/15		% Change
Net revenues	$	619,974	$	560,982		10.5		$	581,286		6.7
Net income	$	27,055	$	43,097		(37.2	)	$	11,172		142.2
Non-GAAP net income1	$	43,354	$	49,940		(13.2	)	$	40,211		7.8
Earnings per common share:
Basic	$	0.40	$	0.62	$	(35.5	)	$	0.16		150.0
Diluted	$	0.36	$	0.56	$	(35.7	)	$	0.14		157.1
Non-GAAP net income1	$	0.57	$	0.65	$	(12.3	)	$	0.51		11.8
Weighted average number of common shares outstanding:
Basic		67,579		68,006		(0.6	)		68,150		(0.8	)
Diluted		76,086		77,359		(1.6	)		79,355		(4.1	)

¹ A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed under “Non-GAAP Financial Measures.”

1

Brokerage Revenues

Brokerage revenues, defined as commissions plus principal transactions, were $318.9 million, a 13.7% increase compared with the first quarter of 2015 and an 8.2%  compared with the fourth quarter of 2015.

· Global wealth management brokerage revenues were $173.0 million, a 9.5% increase compared with the first quarter of 2015 and a 4.0% increase compared with the fourth quarter of 2015.

· Institutional equity brokerage revenues were $62.3 million, a 0.8% increase compared with the first quarter of 2015 and a 13.6% increase compared with the fourth quarter of 2015.

· Institutional fixed income brokerage revenues were $83.6 million, a 37.8% increase compared with the first quarter of 2015 and a 13.7% increase compared with the fourth quarter of 2015.

Investment Banking Revenues

Investment banking revenues were $100.7 million, a 19.5% decrease compared with the first quarter of 2015 and a 2.1% decrease compared with the fourth quarter of 2015.

· Equity capital raising revenues were $25.5 million, a 47.8% decrease compared with the first quarter of 2015 and a 37.0% decrease compared with the fourth quarter of 2015.

· Fixed income capital raising revenues were $27.8 million, a 3.9% increase compared with the first quarter of 2015 and a 6.3% decrease compared with the fourth quarter of 2015.

· Advisory fee revenues were $47.4 million, a 4.2% decrease compared with the first quarter of 2015 and a 53.7% increase compared with the fourth quarter of 2015.

Asset Management and Service Fee Revenues

Asset management and service fee revenues were $144.5 million, a 26.9% increase compared with the first quarter of 2015 and an 11.8% increase compared with the fourth quarter of 2015.

Compensation and Benefits Expenses

For the quarter ended March 31, 2016, compensation and benefits expenses were $411.1 million, which included $16.4 million of merger-related expenses. This compares with $355.7 million in the first quarter of 2015 and $399.0 million in the fourth quarter of 2015.

Excluding merger-related expenses, compensation and benefits as a percentage of net revenues was 63.6% in the first quarter of 2015, compared with 62.5% in the first quarter of 2015 and 64.8% in the fourth quarter of 2015.

Excluding merger-related expenses, transition pay, which primarily consists of amortization of retention awards, signing bonuses, and upfront notes, was 4.2% of net revenues in the first quarter of 2015, compared with 4.1% in the first quarter of 2015 and 3.9% in the fourth quarter of 2015.  

Non-Compensation Operating Expenses

For the quarter ended March 31, 2016, non-compensation operating expenses were $164.9 million, which included merger-related expenses of $10.1 million. This compares with $135.2 million in the first quarter of 2015 and $171.2 million in the fourth quarter of 2015.

Excluding merger-related expenses, non-compensation operating expenses as a percentage of net revenues for the quarter ended March 31, 2015 was 25.0%, compared with 23.2% in the first quarter of 2015 and 25.4% in the fourth quarter of 2015.

Provision for Income Taxes

The effective income tax rate for the quarter ended March 31, 2016 was 38.4% compared with 38.5% in the first quarter of 2015.  

2

Assets and Capital

Assets

· Assets increased 51.6% to $14.2 billion as of March 31, 2016 from $9.4 billion as of March 31, 2015.

· At March 31, 2016, the Company’s Level 3 assets of $58.0 million, or 0.4% of total assets, consisted of $52.2 million of auction rate securities and $5.8 million of partnership interests, private company investments, private equity, and fixed income securities. The Company’s Level 3 assets as a percentage of total assets measured at fair value was 1.7% at March 31, 2016.

· Non-performing assets as a percentage of total assets as of March 31, 2016 was 0.28%.

Capital

· Shareholders’ equity as of March 31, 2016 increased 2.3% to $2.41 billion from $2.36 billion as of March 31, 2015.

· During the three months ended March 31, 2016, the Company repurchased 2.7 million shares of the Company’s common stock for approximately $91.4 million.

· At March 31, 2016, book value per common share was $36.37 based on 66.5 million common shares outstanding. This represents a 4.4% increase from March 31, 2015.

· At March 31, 2016, the Company’s Tier 1 leverage capital and Tier 1 risk-based capital ratios were 11.6% and 21.3%, respectively, compared to 17.5% and 29.9%, respectively, at March 31, 2015.

3

Conference Call Information

Stifel Financial Corp. will host its first quarter 2016 financial results conference call on Monday, May 9, 2016, at 5:00 p.m. Eastern time. The conference call may include forward-looking statements.

All interested parties are invited to listen to Stifel’s Chairman and CEO, Ronald J. Kruszewski, by dialing(877) 876-9938 and referencing conference ID #88960277.A live audio webcast of the call, as well as a presentation highlighting the Company’s results, will be available through the Company's web site, www.stifel.com. For those who cannot listen to the live broadcast, a replay of the broadcast will be available through the above-referenced web site beginning approximately one hour following the completion of the call.

Company Information

Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its banking, securities, and financial services business through several wholly owned subsidiaries. Stifel’s broker-dealer clients are served in the United States through Stifel, Nicolaus & Company, Incorporated; Keefe Bruyette & Woods, Inc.; Miller Buckfire & Co., LLC; and Century Securities Associates, Inc., and in the United Kingdom and Europe through Stifel Nicolaus Europe Limited. The Company’s broker-dealer affiliates provide securities brokerage, investment banking, trading, investment advisory, and related financial services to individual investors, professional money managers, businesses, and municipalities. Stifel Bank & Trust offers a full range of consumer and commercial lending solutions. Stifel Trust Company, N.A. and Stifel Trust Company Delaware, N.A. offer trust and related services. To learn more about Stifel, please visit the Company’s web site at www.stifel.com.

Forward-Looking Statements

This earnings release contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  All statements in this earnings release not dealing with historical results are forward-looking and are based on various assumptions.  The forward-looking statements in this earnings release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements.  Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among other things, the following possibilities:  the ability to successfully integrate acquired companies or the branch offices and financial advisors; a material adverse change in financial condition; the risk of borrower, depositor, and other customer attrition; a change in general business and economic conditions; changes in the interest rate environment, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation and regulation; other economic, competitive, governmental, regulatory, geopolitical, and technological factors affecting the companies’ operations, pricing, and services; and other risk factors referred to from time to time in filings made by Stifel Financial Corp. with the Securities and Exchange Commission.  Forward-looking statements speak only as to the date they are made. Stifel Financial Corp. disclaims any intent or obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

4

	Summary Results of Operations (Unaudited)
	Three Months Ended
(in thousands, except per share amounts)	3/31/16		3/31/15		% Change			12/31/15			% Change
Revenues:
Commissions	$	197,930	$	180,302		9.8		$	187,287			5.7
Principal transactions		120,948		100,205		20.7			107,464			12.5
Brokerage Revenues		318,878		280,507		13.7			294,751			8.2
Investment banking		100,658		125,089		(19.5	)		102,811			(2.1	)
Asset management and service fees		144,532		113,869		26.9			129,319			11.8
Other income		7,231		11,800		(38.7	)		18,251			(60.4	)
Operating Revenue		571,299		531,265		7.5			545,132			4.8
Interest Revenue		62,786		42,736		46.9			48,639			29.1
Total Revenue		634,085		574,001		10.5			593,771			6.8
Interest Expense		14,111		13,019		8.4			12,485			13.0
Net Revenue		619,974		560,982		10.5			581,286			6.7
Non-interest Expenses:
Compensation and benefits		411,113		355,693		15.6			398,966			3.0
Occupancy and equipment rental		57,255		44,170		29.6			61,667			(7.2	)
Communication and office supplies		36,660		29,234		25.4			34,652			5.8
Commissions and floor brokerage		11,732		10,069		16.5			10,895			7.7
Other operating expenses		59,301		51,750		14.6			64,024			(7.4	)
Total non-interest expenses		576,061		490,916		17.3			570,204			1.0
Income before income taxes		43,913		70,066		(37.3	)		11,082			296.3
Provision for income taxes		16,858		26,969		(37.5	)		(90	)	nm
Net income	$	27,055	$	43,097		(37.2	)	$	11,172			142.2
Earnings per common share:
Basic		0.40	$	0.62		(35.5	)		0.16			150.0
Diluted	$	0.36	$	0.56		(35.7	)	$	0.14			157.1
Weighted average number of common shares outstanding:
Basic		67,579		68,006		(0.6	)		68,150			(0.8	)
Diluted		76,086		77,359		(1.6	)		79,355			(4.1	)

Statistical Information

	(in thousands, except per share amounts)
	3/31/16		3/31/15		% Change		12/31/15		% Change
Statistical Information:
Book value per share	$	36.37	$	34.83		4.4	$	37.19		(2.2	)
Financial advisors2		2,849		2,097		35.9		2,891		(1.5	)
Full-time associates		7,100		6,140		15.6		7,133		(0.5	)
Locations		401		368		9.0		402		(0.2	)
Total client assets	$	232,013,000	$	188,616,000		23.0	$	234,070,000		(0.9	)

²         Includes 688, 134, and 719 independent contractors at March 31, 2016, March 31, 2015, and December 31, 2015, respectively.

5

Business Segment Results

	Summary Segment Results (Unaudited)
	Three Months Ended
(in 000s)	3/31/16			3/31/15			% Change			12/31/15			% Change
Net revenues:
Global Wealth Management	$	379,805		$	329,410			15.3		$	347,216			9.4
Institutional Group		241,276			238,607			1.1			246,325			(2.0	)
Other		(1,107	)		(7,035	)		84.3			(12,255	)		(91.0	)
	$	619,974		$	560,982			10.5		$	581,286			6.7
Operating contribution:3
Global Wealth Management	$	93,335		$	98,847			(5.6	)	$	92,077			1.4
Institutional Group		29,194			32,331			(9.7	)		40,917			(28.7	)
Other		(51,920	)		(50,369	)		3.1			(75,701	)		(31.4	)
	$	70,609		$	80,809			(12.6	)	$	57,293			23.2
As a percentage of net revenues:
Compensation and benefits
Global Wealth Management		58.3			55.6						57.1
Institutional Group		62.4			62.6						58.1
Non-comp. operating expenses
Global Wealth Management		17.1			14.4						16.4
Institutional Group		25.5			23.8						25.3
Income before income taxes
Global Wealth Management		24.6			30.0						26.5
Institutional Group		12.1			13.6						16.6
		11.4			14.3						9.8

³ A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed under “Non-GAAP Financial Measures.”

Global Wealth Management Summary Results of Operations (Unaudited)
	Three Months Ended
(in 000s)	3/31/16		3/31/15		% Change			12/31/15			% Change
Revenues:
Commissions	$	131,554	$	116,214		13.2		$	128,395			2.5
Principal transactions		41,411		41,781		(0.9	)		37,944			9.1
Brokerage revenues		172,965		157,995		9.5			166,339			4.0
Asset management and service fees		144,352		113,666		27.0		$	130,382			10.7
Net interest		51,767		37,924		36.5			42,187			22.7
Investment banking		8,410		10,326		(18.6	)		8,313			1.2
Other income		2,311		9,499		(75.7	)		(5	)	nm
Net revenues		379,805		329,410		15.3			347,216			9.4
Non-interest expenses:
Compensation and benefits		221,416		183,243		20.8			198,137			11.7
Non-compensation operating expenses		65,054		47,320		37.5			57,002			14.1
Total non-interest expenses		286,470		230,563		24.2			255,139			12.3
Income before income taxes	$	93,335	$	98,847		(5.6	)	$	92,077			1.4
As a percentage of net revenues:
Compensation and benefits		58.3		55.6				57.1
Non-compensation operating expenses		17.1		14.4				16.4
Income before income taxes		24.6		30.0				26.5

6

	Stifel Bank & Trust (Unaudited)
	Key Statistical Information
(in 000s, except percentages)	3/31/16			3/31/15			% Change			12/31/15			% Change
Other information:
Assets		8,310,224		$	5,289,349			57.1		$	7,275,308			14.2
Investment securities		4,147,647			2,599,854			59.5			3,479,336			19.2
Retained loans, net		3,737,209			2,505,007			49.2			3,449,662			8.3
Loans held for sale		132,900			188,783			(29.6	)		189,921			(30.0	)
Deposits		7,218,100			4,834,042			49.3			6,638,359			8.7
Allowance as a percentage of loans4		0.94	%		0.96	%					0.90	%
Non-performing assets as a percentage of total assets		0.28	%		0.13	%					0.03	%

⁴ Excluding acquired loans of $822.5 million, $263.7 million, and $606.8 million, the allowance as a percentage of loans totaled 1.29%, 1.10%, and 1.19% as of March 31, 2016, March 31, 2015, and December 31, 2015, respectively.

Institutional Group Summary Results of Operations (Unaudited)
	Three Months Ended
(in 000s)	3/31/16		3/31/15		% Change			12/31/15		% Change
Revenues:
Commissions	$	66,376	$	64,088		3.6		$	58,891		12.7
Principal transactions		79,537		58,423		36.1			69,520		14.4
Brokerage revenues		145,913		122,511		19.1			128,411		13.6
Capital raising		44,895		65,321		(31.3	)		61,766		(27.3	)
Advisory fees		47,354		49,443		(4.2	)		30,810		53.7
Investment banking		92,249		114,764		(19.6	)		92,576		(0.4	)
Other5		3,114		1,332		133.8			25,338		(87.7	)
Net revenues		241,276		238,607		1.1			246,325		(2.0	)
Non-interest expenses:
Compensation and benefits		150,618		149,411		0.8			143,162		5.2
Non-compensation operating expenses		61,464		56,865		8.1			62,246		(1.3	)
Total non-interest expenses		212,082		206,276		2.8			205,408		3.2
Income before income taxes	$	29,194	$	32,331		(9.7	)	$	40,917		(28.7	)
As a percentage of net revenues:
Compensation and benefits		62.4		62.6				58.1
Non-compensation operating expenses		25.5		23.8					25.3
Income before income taxes		12.1		13.6				16.6

7

Institutional Group Brokerage & Investment Banking Revenues (Unaudited)
	Three Months Ended
(in 000s)	3/31/16		3/31/15		% Change			12/31/15		% Change
Institutional brokerage:
Equity	$	62,273	$	61,803		0.8		$	54,837		13.6
Fixed income		83,640		60,708		37.8			73,574		13.7
Institutional brokerage		145,913		122,511		19.1			128,411		13.6
Investment banking:
Capital raising:
Equity		18,930		44,591		(57.5	)		38,499		(50.8	)
Fixed income		25,965		20,730		25.3			23,267		11.6
Capital raising		44,895		65,321		(31.3	)		61,766		(27.3	)
Advisory fees:		47,354		49,443		(4.2	)		30,810		53.7
Investment banking	$	92,249	$	114,764		(19.6	)	$	92,576		(0.4	)

⁵ Includes net interest, asset management and service fees, and other income.

8

Non-GAAP Financial Measures

The Company utilized non-GAAP calculations of presented net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin, and basic and diluted earnings per share as additional measures to aid in understanding and analyzing the Company’s financial results for the three months ended March 31, 2016. Specifically, the Company believes that the non-GAAP measures provide useful information by excluding certain items that may not be indicative of the Company’s core operating results and business outlook. The Company believes that these non-GAAP measures will allow for a better evaluation of the operating performance of the business and facilitate a meaningful comparison of the Company’s results in the current period to those in prior and future periods. Reference to these non-GAAP measures should not be considered as a substitute for results that are presented in a manner consistent with GAAP. These non-GAAP measures are provided to enhance investors' overall understanding of the Company’s current financial performance. The non-GAAP financial information should be considered in addition to, not as a substitute for or as being superior to, operating income, cash flows, or other measures of financial performance prepared in accordance with GAAP. These non-GAAP amounts primarily exclude acquisition related expenses which management believes are duplicative and will be eliminated and other expenses which in management’s view are not representative of on-going business.

A limitation of utilizing these non-GAAP measures of net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expenses ratios, pre-tax margin, and basic and diluted earnings per share is that the GAAP accounting effects of these merger-related charges do in fact reflect the underlying financial results of the Company’s business and these effects should not be ignored in evaluating and analyzing its financial results. Therefore, the Company believes that GAAP measures of net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin, and basic and diluted earnings per share and the same respective non-GAAP measures of the Company’s financial performance should be considered together.

The following table provides details with respect to reconciling net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin, and basic and diluted earnings per share on a GAAP basis for the three months ended March 31, 2016 to the aforementioned expenses on a non-GAAP basis for the same period.

	Three Months Ended March 31, 2016
(in 000s, except per share amounts)	Non-GAAP		Adjustments			GAAP
Net revenues	$	620,121	$	(147	)	$	619,974
Non-interest expenses:
Compensation and benefits		394,684		16,429			411,113
Non-compensation operating expenses		154,828		10,120			164,948
Total non-interest expenses		549,512		26,549			576,061
Income before income taxes		70,609		(26,696	)		43,913
Provision for income taxes		27,255		(10,397	)		16,858
Net income	$	43,354	$	(16,299	)	$	27,055
Earnings per share:
Basic	$	0.64	$	(0.24	)	$	0.40
Diluted	$	0.57	$	(0.21	)	$	0.36
As a percentage of net revenues:
Compensation and benefits		63.6					66.3
Non-compensation operating expenses		25.0					26.6
Income before income taxes		11.4					7.1

Investor Relations

Joel Jeffrey

(212) 271-3610, investorrelations@stifel.com

9

EX-99.2

1st Quarter 2016 Financial Results Presentation May 9, 2016

Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and future business prospects of Stifel Financial Corp., as well as Stifel, Nicolaus & Company, Incorporated and its subsidiaries (collectively, “SF” or the “Company”). These statements can be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” and similar expressions. In particular, these statements may refer to our goals, intentions, and expectations, our business plans and growth strategies, our ability to integrate and manage our acquired businesses, estimates of our risks and future costs and benefits, and forecasted demographic and economic trends relating to our industry. You should not place undue reliance on any forward-looking statements, which speak only as of the date they were made. We will not update these forward-looking statements, even though our situation may change in the future, unless we are obligated to do so under federal securities laws. Actual results may differ materially and reported results should not be considered as an indication of future performance. Factors that could cause actual results to differ are included in the Company’s annual and quarterly reports and from time to time in other reports filed by the Company with the Securities and Exchange Commission and include, among other things, changes in general economic and business conditions, actions of competitors, regulatory and legal actions, changes in legislation, and technology changes. Use of Non-GAAP Financial Measures The Company utilized non-GAAP calculations of presented net revenues, compensation and benefits, non-compensation operating expenses, income from continuing operations before income taxes, provision for income taxes, net income from continuing operations, net income, compensation and non-compensation operating expense ratios, pre-tax margin and diluted earnings per share as an additional measure to aid in understanding and analyzing the Company’s financial results for the three months ended March 31, 2016. Specifically, the Company believes that the non-GAAP measures provide useful information by excluding certain items that may not be indicative of the Company’s core operating results and business outlook. The Company believes that these non-GAAP measures will allow for a better evaluation of the operating performance of the business and facilitate a meaningful comparison of the Company’s results in the current period to those in prior periods and future periods. Reference to these non-GAAP measures should not be considered as a substitute for results that are presented in a manner consistent with GAAP. These non-GAAP measures are provided to enhance investors' overall understanding of the Company’s financial performance.

1st Quarter Highlights 1st Quarter Highlights: Record total net revenue of $620 mil. up 7% sequentially & 11% Y/Y Record total Global Wealth Management net revenue of $380 mil. up 9% sequentially & 15% Y/Y Record total Stifel Bank & Trust net revenue of $53 mil. up 34% sequentially & 49% Y/Y Total assets on balance sheet of $14.2 bil. up 7% sequentially & 52% Y/Y Total Institutional net revenue of $241 mil., down 2% sequentially but up 1% Y/Y Total Institutional Fixed Income net revenue of $115 mil., up 32% Y/Y Non-GAAP EPS of $0.57 up 12% sequentially but down 12% Y/Y; GAAP EPS of $0.36 Repurchased 2.7 mil. shares in 1Q16. Completed acquisition of Eaton Partners. Added two new Directors to our Board Final publication of DOL Fiduciary Regulations

Revenue & Segment Results

Core Revenue Growth Total net revenue of $620 mil. up 7% sequentially and 11% Y/Y driven by: Brokerage revenue increased 8% sequentially & 14% Y/Y Asset Management revenue increased 12% sequentially & 27% Y/Y Net Interest Income increased 35% sequentially & 64% Y/Y Global Wealth Management represented 61% of net revenue vs. 59% in 4Q15 and 58% in 1Q15 Institutional net revenue of $241 mil. declined 2% sequentially but increased 1% Y/Y Core Net Revenue (mil.) Core Segment Net Revenue (mil.)

Global Wealth Management Total net revenue in the GWM segment was $380 mil., up 9% sequentially & 15% Y/Y Brokerage revenue increased 4% sequentially & 10% Y/Y Asset management revenue increased 11% sequentially & 27% Y/Y Net interest income increased 23% sequentially & 37% Y/Y 2,849 total FAs $232 bil. in client AUA Compensation ratio was 58.3% up 120 bps sequentially & 270 bps Y/Y Non-comp. ratio was 17.1% up 70 bps sequentially & 270 bps Y/Y Pre-tax margin was 25% down 190bps sequentially & 540 bps Y/Y. GWM Core Net Revenue (mil.) Core Expense Ratios & Pre-Tax Margin

Stifel Bank & Trust Total net revenue at Stifel Bank & Trust was $53.4 mil., up 34% sequentially & 49% Y/Y Total bank loans of $3.7 bil. increased 8% sequentially & 49% Y/Y Total investment securities of $4.2 bil. increased 19% sequentially & 60% Y/Y NIM of 2.48% was down 2bps sequentially & flat Y/Y Allowance for loan losses as a percentage of loans 0.94% of total loans vs. 0.90% in 4Q15 Net Revenue (mil.) Asset Growth

Institutional Group Total net revenue of $ 241 mil. was down 2% sequentially but up 1% Y/Y Investment banking revenue of $92 mil. declined 1% sequentially & 20% Y/Y Advisory revenue of $47 mil. increased 54% sequentially but declined 4% Y/Y Brokerage revenue of $146 mil. increased 14% sequentially & 19% Y/Y Compensation ratio was 62.4% up 430 bps sequentially but down 20 bps Y/Y Non-comp. ratio was 25.5% up 20 bps sequentially & 170 bps Y/Y Pre-tax margin was 12% down 450bps sequentially & 140 bps Y/Y. Net Revenue Core Expense Ratios & Pre-Tax Margin

Institutional Brokerage & Investment Banking Brokerage revenue of $146 mil. Equity brokerage revenue of $62 mil. was up 14% sequentially & 1% Y/Y Fixed income brokerage revenue of $84 mil. was up 14% sequentially and 38% Y/Y Underwriting revenue of $45 mil. declined 27% sequentially & 31% Y/Y Equity underwriting of $19 mil. declined 51% sequentially & 58% Y/Y Fixed income underwriting of $26 mil. declined 12% sequentially but increased 25% Y/Y Advisory revenue of $47 mil. increased 54% sequentially but declined 4% Y/Y Equity & Fixed Income Brokerage Net Revenue Investment Banking Net Revenue

Expense & Balance Sheet

Stifel Financial Corp. Results Three months ended March 31, 2016 _________________________________________________________ (1) (2) (2) Adjustments consist primarily of acquisition related expenses, which management believes are duplicative and will be eliminated, stock-based compensation and other expenses which in management’s view are not representative of on-going business. Results for the three months ended March 31, 2015 and December 31, 2015 are non-GAAP.

Non-GAAP Deal Integration Costs

Balance Sheet & Capital Return Net Interest Income Drivers Balance Sheet: Total assets increased to $14.2 bil. up 7% sequentially & 52% Y/Y Average interest earning assets increased to $9.7 bil. up 24% sequentially & 51% Y/Y NIM increased to 201 bps , up 5 bps sequentially & 16 bps Y/Y. Tier 1 leverage ratio was 11.6% in 1Q16 down 500 sequentially Q/Q & 590 bps Y/Y Tier 1 risk based capital ratio of 21.3% in 1Q16 was down 500 bps sequentially & 860 bps Y/Y Book value per share was $36.37 Share Repurchases Repurchased 2.7 mil. shares in 1Q16 for total consideration of $91.4 mil. 8.2 mil. shares remaining on current authorization.

Interest Rate Sensitivity Maintaining annual guidance of $66 mil. incremental pre-tax income for first 100bps Fed Funds increase. First 25 bps increase in December Generated incremental $3.7 mil. of pre-tax income in 1Q16 vs. 4Q15 in Asset Management & Service Fee revenue from the insured bank deposit program and money market fees. Generated additional pre-tax income from NII of $4.5 mil. during the quarter higher yields on certain loans and securities. Due to limited competitive pressure on deposit yields, Stifel kept more of the 25 bps increase in yields than previously estimated. Expect to realize the full benefit of the first increase in Fed Funds in 2Q16 as a large percentage of securities are based on 90 day LIBOR and didn’t reprice until the end of 1Q16.

Outlook & Key Drivers

Balance Sheet Growth

Core & GAAP EPS to Converge As Deal Charges Realized Deal related pre-tax expenses totaled $46.5 mil. and $152 mil. in 2014 and 2015, respectively. The increase in 2015 resulted in a $1.24 differential between Core EPS and GAAP EPS. $141 mil. of non-core deal related expenses forecasted for 2016 with 59% realized in 2Q16. All else equal, the differential between Core and GAAP EPS should decline significantly in 2017 vs. 2016. 2017 GAAP EPS could effectively double based on current consensus EPS estimates. * EPS estimates for 2Q16 - 4Q16 as well as 2016 and 2017 based on consensus core EPS estimates as of 5/4/2016

Q&A