Date:                     18^th October 2011

On behalf of:        B. P. Marsh & Partners Plc ("B. P. Marsh", "the Company" or

                             "the Group")

Embargoed until:  0700hrs

B.P. Marsh & Partners Plc

("B. P. Marsh", "the Company" or "the Group")

Interim Results

B. P. Marsh & Partners Plc (AIM: BPM), a niche venture capital provider to early stage financial services businesses, announces its unaudited Group results for the six months ended 31 July 2011.

Chairman's Statement

Financial Highlights

·     Net Asset Value ("NAV") during six month period up 4.3% to £48.5m from £46.5m at 31 January 2011

·     NAV year on year increase of 8.1% from £44.9m at 31 July 2010

·     NAV per share of 166p, an increase of 13p from 153p at 31 July 2010

·     Profit before tax of £2.3m (unaudited), an increase of 69.4% from £1.4m for the six months to 31 July 2010

·     Average compound NAV growth of 12.1% p.a. since 1990 (excl. £10.1m raised on flotation)

·     £0.45m cash at year-end plus a further £3.075m loan facility available (£2.36m committed to current investments, £1.17m available)

Overview

We are pleased to announce the interim results for B.P. Marsh & Partners Plc and its consolidated statements for the six-month period ended 31 July 2011 (the "Period").

During the Period we have successfully increased NAV by 4%, which the Board considers to be a solid achievement in light of the continued climate of economic fragility, whilst our share price has performed consistently against the benchmark indices over the Period. This NAV uplift is predominantly due to the continued strong growth in revenues and EBITDA at Hyperion, together with a solid performance from our other investments.

The Board remains committed to its previously stated aim of reducing the discount to NAV. We are maintaining our corporate visibility in the market with increased newsflow and the release of our Trading Update in August demonstrates that this approach has a positive effect on share price. The Group also reconsidered its advisory appointments over the period and appointed Panmure Gordon as Corporate Broker and Nominated Adviser with effect from 12 September 2011.

The Board recognises the challenges faced by small and mid-cap companies retaining a listing on AIM and our Group is no exception to this. Whilst the junior market has shown some signs of resurgence in recent months, the Directors are of the view that economic conditions will continue to be difficult. Nevertheless, we are confident in the strength of our underlying portfolio. 

Portfolio Update

Besso Insurance Group Ltd ("Besso")

In April 2011, the Group acquired a further 11% shareholding and additional loan stock in Besso for £1.5m, taking its total equity holding in the group to 34%; £1.25m of this further investment was financed from the £4.325m Directors' loan that was put in place in June 2010.

The Group first invested in Besso in 1995 and when the opportunity arose to restructure the company the Group demonstrated its commitment to its investee company. It is this commitment to Management within the investee companies that makes the Group unique.

The transaction saw Michael Wade joining Besso as its new Chairman, taking a 15% stake in place of Union Hamilton Reinsurance Limited (part of the Wells Fargo corporation). Besso has maintained its listing in the Insurance Times Top 50 Brokers, ranked 36^th in the 2011 edition, and with the support of its shareholders, is now in the process of repositioning; building on its existing business and manoeuvring itself to take advantage of opportunities to grow through acquisition and attracting new teams. Besso has also appointed Tony Hulse as a non-executive director, who was a partner at KPMG, and spent the last two years as their Head of General Insurance Markets in the UK.

Hyperion Insurance Group Ltd ("Hyperion")

In 2010 Hyperion increased revenue by 26% to £72.2m and EBITDA by 41% to £12.0m. 2011 is on track to deliver further strong revenue and EBITDA growth, and the group has expanded further with the acquisition of Accette Insurance Group, Asia's largest independent insurance broker, and the acquisition of Davidoff Insurance Brokers in Israel.

Howden Broking Group (the broking subsidiary of Hyperion) reached agreement to acquire the broking business of professional indemnity specialist PYV Ltd on 3 May 2011. As a result of this acquisition a significant team and book of business has moved to Howden Broking Group.

Hyperion has moved up to 19^th place in the Insurance Times Top 50 Brokers listings, from 22^nd  place in 2010,  following their 2010 results. The group was named as one of the top 10 insurance brokers to deliver outstanding results and the Insurance Times stated "This is a tremendous story of what can be achieved through focus, hard work and an underwriting agency that delivers excellent profits". Earlier this year Howden Insurance Brokers (the UK Broking subsidiary of Howden Broking Group Ltd) won the Insurance Broker of the Year award at the 2011 British Insurance Awards.

Oxford Insurance Brokers Ltd ("Oxford"), trading subsidiary of US Risk (UK) Ltd

David Doe and his North American special lines division are the latest recruits to join Oxford, moving from Alwen Hough Johnson. This team specialises in professional liability, financial institutions and directors and officers business.

This follows the arrival of another North American specialty lines team earlier this year from AJ Gallagher International.

In recent months Oxford has also brought in new teams to strengthen its UK professional indemnity division and to develop an international fine art and specie portfolio.

Group Strategy, Market Overview and Investment Opportunities

The Group focuses on minority investment opportunities in financial services business, typically taking an equity stake of between 15% and 45%. The geographic focus is predominantly within the UK but the Group continues to investigate opportunities to strengthen relationships with potential US-based investment partners, recognising that in the insurance market in particular there are increasing investment opportunities in the North American region. These are in part being generated by fall-out from continuing consolidation in the "big three" insurance brokers and the emergence of new participants in the market on aggressive acquisition trails, such as Ryan-Turner Specialty LLC , leading to potential opportunities for new investment as well as for the Group's existing portfolio companies.

Despite these positive developments, conditions remain difficult in the insurance market, with Lloyd's of London posting an interim loss of £697m for the six-month period ending 30 June 2011. Recent natural disasters do not appear to have soaked up excess capacity in the market and rates remain soft across many lines of business.

Shareholders

The Board remains committed to its stated aim of narrowing the discount to NAV and delivering shareholder returns that reflect performance. The Directors believe that the Group's investment portfolio is demonstrating steady growth and that the portfolio will continue to increase in value.

Dividends

As previously stated in the Annual Results for the year ended 31 January 2011, the Group is not minded to recommend dividends while part of its loan facility remains drawn upon. Therefore no dividends will be paid from the period to 31 July 2011. However, as successful realisations are made and loan funds repaid, the Board will reassess this position.

Outlook

The general economic outlook remains uncertain and this calls for a steady approach from the Board and the Group over the coming months. Whilst it is difficult to predict how events in the global economy will unfold, the Board believes that the Group continues to be well-positioned to face ongoing challenges in the global markets, and to exploit the potential investment opportunities this presents. The Board continues to consider and rigorously review all exit opportunities for its portfolio of investments.

Brian Marsh OBE

Chairman

18 October 2011

Investments

As at 31st July 2011 the Group's equity interests were as follows:

Amberglobe Limited

(www.amberglobe.co.uk)

In March 2008 the Group assisted in establishing Amberglobe Limited, a business sales platform that provides valuation and negotiation services for the sale of SME businesses in the sub £3m sector.

Date of investment: March 2008

Equity stake: 49.0%

31st July 2011 valuation: £98,000

Besso Insurance Group Limited

(www.besso.co.uk)

In February 1995 the Group assisted a specialist team departing from insurance broker Jardine Lloyd Thompson Group in establishing Besso Holdings Limited. The company specialises in insurance broking for the North American wholesale market, and changed its name to Besso Insurance Group Limited in June 2011.

Date of investment: February 1995

Equity stake: 34.02%

31st July 2011 valuation: £4,182,000

HQB Partners Limited

(www.hqbpartners.com )

In January 2005 the Group made an investment in HQB Partners, a company which provides strategic transaction advice, proxy solicitation services, voting analysis and investor relations services.

Date of investment: January 2005

Equity stake: 27.72%

31st July 2011 valuation: £0

Hyperion Insurance Group Limited

(www.hyperiongrp.com)

The Group first invested in Hyperion Insurance Group in 1994. The Hyperion Insurance Group owns, amongst other things, an insurance broker specialising in directors' and officers' ("D&O") and professional indemnity ("PI") insurance. A subsidiary of Hyperion became a registered Lloyd's insurance broker. In 1998 Hyperion set up an insurance managing general agency specialising in developing D&O and PI business in Europe.

Date of investment: November 1994

Equity: 19.5%

31st July 2011 valuation: £31,748,000

LEBC Holdings Limited

(www.lebc-group.com)

In April 2007 the Group invested in LEBC, an Independent Financial Advisory company providing services to individuals, corporates and partnerships, principally in employee benefits, investment and life product areas.

Date of investment: April 2007

Equity stake: 21.95%

31st July 2011 valuation: £3,069,000

Paterson Squared, LLC

(www.paterson2.com)

Paterson Squared was founded by a group of professionals from the actuarial, capital markets and reinsurance advisory sectors in conjunction with the Group. The company uses sophisticated modelling techniques to assess risk, with a view to providing counter-party risk transaction advice.

Date of investment: April 2004

Equity stake: 22.5%

31st July 2011 valuation: £0

Portfolio Design Group International Limited

(www.surrendalink.co.uk)

In March 1994 the Group invested in the Portfolio Design Group, a company which sells with-profits life endowment policies to large financial institutions. In 2002 the company diversified into investment management.

Date of investment: March 1994

Equity stake: 20.0%

31st July 2011 valuation: £1,893,000

Randall & Quilter Investment Holdings plc

(www.rqih.com)

Randall & Quilter Investment Holdings plc is an AIM listed run-off management service provider and acquirer of solvent insurance companies in run-off. The Group invested in Randall & Quilter in January 2010, the result of a share exchange with the Group's shareholding in JMD Specialist Insurance Services Group Limited, which Randall & Quilter have now wholly acquired

Date of investment: January 2010

Equity stake: 1.23%

31st July 2011 valuation: £844,992

Summa Insurance Brokerage, S. L.

(www.grupo-summa.com)

In January 2005 the Group provided finance to a Spanish management team with the objective of acquiring and consolidating regional insurance brokers in Spain.

Date of investment: January 2005

Equity stake: 48.63%

31st July 2011 valuation: £5,210,000

US Risk (UK) Limited

(www.oxfordinsurancebrokers.co.uk)

In July of this year the Group completed its investment in US Risk (UK) Limited, the parent company of Oxford Insurance Brokers Limited, a London-based Lloyd's insurance and reinsurance broker.

Date of investment: July 2010

Equity stake: 30.0%

31st July 2011 valuation: £1,647,000

These investments have been valued in accordance with the accounting policies on Investments set out in note 1 of the Consolidated Financial Statements.

Consolidated Financial Statements

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 31ST JULY 2011

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31ST JULY 2011

The Interim Consolidated Financial Statements were approved by the Board of Directors and authorised for issue on 17th October 2011

and signed on its behalf by B.P. Marsh & J.S. Newman.

 CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE PERIOD ENDED 31ST JULY 2011

*The exchange movement as noted in the Consolidated Statement of Comprehensive Income is £30k (6 months to 31st July 2010: £(30)k & 12 months to 31st January 2011: £(10)k).  The movement in the Consolidated Statement of Cash Flows excludes an exchange gain of £31k (6 months to 31st July 2010: loss £33k & 12 months to 31st January 2011: loss £10k) relating to the revaluation of a loan denominated in Euros as this is a non-cash movement. 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 31ST JULY 2011

Refer to Note 6 for detailed analysis of the changes in the components of equity.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31ST JULY 2011

1.       ACCOUNTING POLICIES

Basis of preparation of financial statements

These financial statements have been prepared in accordance with International Financial Reporting Standards as adopted for use by the European Union ("IFRS"), and in accordance with the Companies Act 2006. 

The consolidated financial statements have been prepared under the historical cost convention as modified by the revaluation of certain financial assets and financial liabilities through the profit or loss.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates particularly in relation to investment valuation.  It also requires management to exercise its judgement in the process of applying the Group's accounting policies.

These interim consolidated financial statements were approved by the Board on 17th October 2011.  They have not been audited nor reviewed by the Group's Auditors, as is the case with the comparatives to 31st July 2010, and do not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006.

The financial statements have been prepared using the accounting policies and presentation that were applied in the audited financial statements for the year ended 31st January 2011.  Those accounts, upon which the Group's Auditors issued an unqualified opinion, have been filed with the Registrar of Companies and do not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

Basis of consolidation

The Group financial statements consolidate the results and net assets of the Company and all of its subsidiary undertakings. 

Business Combinations

The results of subsidiary undertakings are included in the consolidated financial statements from the date that control commences until the date that control ceases.  Control exists where the Group has the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.  Accounting policies of the subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. 

All business combinations are accounted for by using the acquisition accounting method. This involves recognising identifiable assets and liabilities of the acquired business at fair value. Goodwill represents the excess of the fair value of the purchase consideration for the interests in subsidiary undertakings over the fair value to the Group of the net assets and any contingent liabilities acquired. 

Intra-group balances and any unrealised gains and losses or income and expenses arising from intra-group transactions are eliminated in preparing the consolidated financial statements.

Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Investments that are held as part of the Group's investment portfolio are carried in the Statement of Financial Position at fair value even though the Group may have significant influence over those companies.  This treatment is permitted by IAS 28 Investment in Associates ("IAS 28"), which requires investments held by venture capital organisations to be excluded from its scope where those investments are designated, upon initial recognition, as at fair value through profit or loss and accounted for in accordance with IAS 39, with changes in fair value recognised in the profit or loss in the period of the change. The Group has no interests in associates through which it carries on its business.

Investments

All investments are designated as "fair value through profit or loss" assets and are initially recognised at the fair value of the consideration.  They are measured at subsequent reporting dates at fair value.

The Board conducts the valuations of investments. In valuing investments the Board applies guidelines issued by the International Private Equity and Venture Capital Valuation ("IPEVCV") Committee. The following valuation methodologies have been used in reaching fair value of investments, some of which are in early stage companies:

a)   at cost, unless there has been a significant round of new equity finance in which case the investment is valued at the price paid by an independent third party. Where subsequent events or changes to circumstances indicate that an impairment may have occurred, the carrying value is reduced to reflect the estimated extent of impairment;

b)   by reference to underlying funds under management;

c)   by applying appropriate multiples to the earnings and revenues of the investee company; or

d)   by reference to expected future cash flow from the investment where a realisation or flotation is imminent.

Both realised and unrealised gains and losses arising from changes in fair value are taken to the Statement of Comprehensive Income for the period.  In the Statement of Financial Position the unrealised gains and losses arising from changes in fair value are shown within a "fair value reserve" separate from retained earnings.  Transaction costs on acquisition or disposal of investments are expensed in the Statement of Comprehensive Income.

Income from investments

Income from investments comprises:

a)   gross interest from loans, which is taken to the Statement of Comprehensive Income on an accruals basis;

b)   dividends from equity investments are recognised in the Statement of Comprehensive Income when the shareholders rights to receive payment have been established; and

c)   advisory fees from management services provided to investee companies, which are recognised on an accruals basis in accordance with the substance of the relevant investment advisory agreement.

Carried interest provision

This represents the amount payable to a director in the event of a particular investment being sold and is calculated on the fair value of that investment at the end of each reporting period.

Property, plant and equipment

Property, plant and equipment are stated at cost less depreciation.  Depreciation is provided at rates calculated to write off the property, plant and equipment cost, less their estimated residual value, over their expected useful lives on the following bases:

     Furniture & equipment - 5 years

     Leasehold fixtures and fittings - over the life of the lease

Foreign currencies

Monetary assets and liabilities denominated in foreign currencies at the reporting period are translated at the exchange rate ruling at the reporting period.

Transactions in foreign currencies are translated into sterling at the rate ruling at the date of the transaction.

Exchange gains and losses are recognised in the Consolidated Statement of Comprehensive Income.

Taxation

The tax expense represents the sum of the tax currently payable and any deferred tax.  The tax currently payable is based on the estimated taxable profit for the year.  Taxable profit differs from net profit as reported in the Consolidated Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.  The Group's liability for current tax is calculated using tax rates that have been enacted or substantially enacted by the date of the Consolidated Statement of Financial Position.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and of liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and it is accounted for using the liability method.  Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.  Such assets and liabilities are not recognised if the temporary differences arise from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each date of the Consolidated Statement of Financial Position and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised.  Deferred tax is charged or credited to the Consolidated Statement of Comprehensive Income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current assets and liabilities on a net basis.

Bonus provision

There is no contractual obligation on the Group to pay bonuses to employees and as such no provision has been made in the operating expenses within the Consolidated Statement of Comprehensive Income for the period to 31st July 2011 (as was also the case with the interims to 31st July 2010). However, the consolidated Statement of Comprehensive Income to 31st January 2011 does include such a provision where discretionary awards were made for the year-end.

International Financial Reporting Standards in issue but not yet effective

At the date of authorisation of these consolidated financial statements, the International Accounting Standards Board ("IASB") and International Financial Reporting Interpretations Committee ("IFRIC") have issued the following standards, which are effective for annual accounting periods beginning on or after the stated effective date.

The directors do not anticipate that adoption of these standards and interpretations will have a material impact on the Group's financial statements in the period of initial application and have decided not to adopt them early.

2.       SEGMENTAL REPORTING

The Group operates in one business segment, provision of consultancy services to as well as making and trading investments in financial services businesses.

The Group identifies its reportable operating segments based on the geographical location in which each of its investments is incorporated and primarily operates.  For management purposes, the Group is organised and reports its performance by two geographic segments: UK and Channel Islands and Non-UK and Channel Islands.

If material to the Group overall (where the segment revenues, reported profit or loss or combined assets exceed the quantitative thresholds prescribed by IFRS 8 Operating Segments ("IFRS 8")), the segment information is reported separately. 

The Group allocates revenues, expenses, assets and liabilities to the operating segment where directly attributable to that segment.  All indirect items are apportioned based on the percentage proportion of revenue that the operating segment contributes to the total Group revenue (excluding any unrealised gains and losses on the Group's non-current investments).

Each reportable segment derives its revenues from three main sources.  These are described in further detail in Note 1 under 'Income from investments'.

All reportable segments derive their revenues entirely from external clients and there are no inter-segment sales.

3.       EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO THE EQUITY SHAREHOLDERS