Set forth on the following pages is management's discussion and analysis of our financial condition and results of operations for the three months ended September 30, 2009 and 2008. Such information should be read in conjunction with our unaudited condensed consolidated financial statements together with the notes to the unaudited condensed consolidated financial statements. When we use the terms the "Company," "management," "we," "us," and "our," we mean Epoch Holding Corporation, a Delaware corporation, and its consolidated subsidiaries.

Forward-Looking Statements

Certain information included, or incorporated by reference in this Quarterly Report on Form 10-Q and other materials filed or to be filed by Epoch Holding Corporation ("Epoch" or the "Company") with the Securities and Exchange Commission (the "SEC") contain statements that may be considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," and the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about the Company, may include projections of the Company's future financial performance based on the Company's anticipated growth strategies and trends in the Company's business. These statements are only predictions based on the Company's current expectations and projections about future events. There are important factors that could cause the Company's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. In particular, you should consider the risks and uncertainties outlined in "Factors Which May Affect Future Results."

These risks and uncertainties are not exhaustive. Other sections of this Quarterly Report on Form 10-Q may include additional factors which could adversely impact the Company's business and financial performance. Moreover, the Company operates in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for the Company's management to predict all risks and uncertainties, nor can the Company's management assess the impact of all factors on the Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Although the Company believes the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, level of activity, performance or achievements. Moreover, neither the Company nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. The Company is under no duty to update any of these forward-looking statements after the date of this Quarterly Report on Form 10-Q, nor to conform the Company's prior statements to actual results or revised expectations, and the Company does not intend to do so.

Forward-looking statements include, but are not limited to, statements about the Company's:

• business strategies and investment policies,

• possible or assumed future results of operations and operating cash flows,

• competitive position,

• potential growth opportunities,

• potential operating performance, achievements, productivity improvements, efficiency and cost reduction efforts,

• expected tax rate,

• expectations with respect to the economy, securities markets, the market for mergers and acquisitions activity, the market for asset management activity and other industry trends,

• product development,

• business environment, and

• the effect of future legislation and regulation on the Company.

Available Information

Reports the Company files electronically with the SEC via the SEC's Electronic Data Gathering, Analysis and Retrieval system ("EDGAR") may be accessed through the internet. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, at www.sec.gov.

The Company maintains a website which contains current information on operations and other matters. The website address is www.eipny.com. Through the Investor Relations section of our website, and "Link to SEC Website" therein, we make available, free of charge, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statement, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

Also available free of charge on our website within the Investors Relations section is our Code of Ethics and Business Conduct and charters for the Audit, Nominating/Corporate Governance, and the Compensation Committees of our Board of Directors.

Factors Which May Affect Future Results

There are numerous risks which may affect the results of operations of the Company. Factors which could affect the Company's success include, but are not limited to, the ability to attract and retain clients, performance of the financial markets and invested assets managed by the Company, retention of key employees, misappropriation of assets and information by employees, system failures, significant changes in regulations, the costs of compliance associated with existing regulations and the penalties associated with non-compliance, and the risks associated with the loss of key members of the management team.

In addition, the Company's ability to expand or alter its product offerings, whether through acquisitions or internal development is critical to its long-term success and has inherent risks. This success is dependent on the ability to identify and fund those products or acquisitions on terms which are favorable to the Company. There can be no assurance that any of these operating factors or acquisitions can be achieved or, if undertaken, they will be successful.

These and other risks related to our Company are discussed in detail under Part I, Item 1A. "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2009.

Critical Accounting Estimates

Our significant accounting estimates are described in Note 2 of the Notes to the Consolidated Financial Statements, as well as Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended June 30, 2009. The Company's Critical Accounting Estimates have not changed from those reported in the Company's Form 10-K for the fiscal year ended June 30, 2009.

Overview

The Company is a global asset management firm with accomplished and experienced professionals. Our professional staff averages over 20 years of experience in our industry. The Company combines in-house research and insight, an absolute-return orientation, and a dedication to serving the informed investor. Headquartered in New York City, the Company had approximately $9.8 billion in assets under management ("AUM") as of September 30, 2009.

The Company's operating subsidiary, Epoch Investment Partners ("EIP"), is a registered investment adviser under the Investment Advisers Act of 1940, as amended (the "Investment Advisers Act"). It has one line of business, and that is to provide investment advisory and investment management services to its clients such as investment companies, retirement plans, mutual fund clients, endowments, foundations, and high net

worth individuals. These services are provided through separately managed accounts and commingled vehicles, such as mutual funds and private investment funds. The overall investment philosophy is focused on achieving a superior risk-adjusted return by investing in companies that generate free cash flow and are undervalued relative to our investment team's value determinations. Security selection and portfolio construction are designed to protect capital in declining markets while participating in rising markets.

Revenues are generally derived as a percentage of AUM. Therefore, among other factors, revenues are dependent on

• performance of financial markets,

• the ability to maintain existing clients, and

• changes in the composition of AUM.

AUM consists of actively traded securities. The fair value of AUM is determined by an independent pricing service, which uses publicly available, unadjusted quoted market prices to measure our AUM. The Company substantiates values obtained for assets with another independent pricing service to confirm all prices are valid. Since virtually no security in AUM is fair valued by the Company, there is no significant judgment involved in the calculation of AUM in a way that directly impacts the Company's revenue recognition.

Financial and Business Highlights

During the three months ended September 30, 2009, nearly all equity markets improved. Favorable market conditions significantly impacted our operations for the quarter. Some notable achievements during the three months ended September 30, 2009 were as follows:

• The Company's AUM increased to approximately $9.8 billion at September 30, 2009, an increase of nearly $2.0 billion, or 24%, from June 30, 2009. AUM increased from September 30, 2008 by 61%, or just over $3.7 billion.

• The Company continued to attract new assets, with net inflows exceeding $0.8 billion during the period.

• Operating leverage, which is defined as the total revenue growth rate that exceeds the rate of growth of expenses, rose considerably. Operating revenues increased by 35% from the same period a year ago, while operating expenses increased by 3%. Operating margin for the quarter ended September 30, 2009 was 31%.

• During September 2009, management entered into a new sublease agreement for 10,000 square feet, and terminated a sublease for 3,000 square feet which was set to expire June 2010. The additional space should provide capacity for future firm expansion.

• The Company's financial position remains strong, with cash balances of $38.0 million, or 63% of total assets, working capital of $41.5 million, and a current ratio of 6.9. The Company expects its working capital to continue to improve during the next quarter as a result of its increase in operating margin.

Summary operating information for the quarter ended September 30, 2009 and 2008 is presented in the table below:

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                                      Three Months Ended                                  Change
                                        September 30,
(Dollars in Thousands)           2009                   2008                     $                     %
Operating Revenues       $        11,417        $         8,478         $           2,939                35 %
Operating Income         $         3,562        $           854         $           2,708               317 %
Operating Margin(1)                   31 %                   10 %
Net Income               $         2,297        $           582         $           1,715               295 %
Earnings Per Share:
Basic and diluted        $          0.10        $          0.03         $            0.07               233 %
AUM (in millions)        $         9,796        $         6,085         $           3,711                61 %

[[Image Removed]]

(1) Defined as operating income divided by operating revenues.

Operating margin significantly improved from the same period a year ago. The main driver of this was the increase in revenue due to higher levels of AUM, primarily as a result of net inflows from new and existing business. Market appreciation, particularly since March 2009, also contributed to the AUM increase. The Company had net inflows of approximately $3.3 billion for the twelve months ended September 30, 2009, and finished the period ended September 30, 2009 with AUM of $9.8 billion, a 61% increase from AUM of $6.1 billion at September 30, 2008.

The average assets under management for the three months ended September 30, 2009 was approximately $8.8 billion compared to approximately $6.6 billion for the three months ended September 30, 2008, an increase of approximately 35%. U.S. equity markets declined approximately 5 - 10% from September 30, 2008, but increased substantially since March 2009. Global equity markets performed slightly better over the past twelve months.

The Company continued to concentrate on expense management and cost containment during the three months ended September 30, 2009. Operating expenses were slightly higher, increasing by $0.2 million compared with the same period a year ago. Lease termination costs from the early termination of subleased premises, as well as accelerated amortization of leasehold improvements on the related premises, were the primary reasons for the increase.

Business Environment

As an investment management and advisory firm, our results of operations can be directly impacted by global market, political, and economic trends. The Company's business environment and equity markets are influenced by several factors, including corporate profitability, investor confidence, unemployment, and financial market transparency. These factors can directly affect market appreciation or depreciation, which in turn, impacts our investment advisory and management business.

During the three months ended September 30, 2009, investor sentiment improved amid signs that the Federal Reserve's expansive monetary policy, coupled with a variety of stimulus programs, succeeded in pulling the economy back onto a more stable path. Equities staged an impressive rally from March 2009 lows. However, uncertainty still exists as to how strong and stable the current economic rebound will be, particularly given current levels of unemployment and consumer confidence.

The improving economy and market environment in the United States during the three months ended September 30, 2009 was emulated by most equity markets around the world.

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                                      Three Months          Twelve Months
Index                                    Ended              September 30,
                                     September 30,               2009
                                          2009
Dow Jones Industrial Average(1)             15.8 %                (7.4 )%
NASDAQ Composite(2)                         15.9 %                 1.5 %
S&P 500(3)                                  15.6 %                (6.9 )%
MSCI World (Net)(4)                         17.4 %                (2.3 )%
Russell 3000 Value(5)                       18.6 %               (10.8 )%

[[Image Removed]]

(1) Dow Jones Industrial Average is a trademark of Dow Jones & Company, which is not affiliated with Epoch.

(2) NASDAQ Composite Index is a trademark of the NASDAQ Stock Market, Inc., which is not affiliated with Epoch.

(3) S&P 500 is a trademark of Standard & Poor's, a division of the McGraw-Hill Companies, Inc., which is not affiliated with Epoch.

(4) MSCI World Index is a trademark of MSCI Inc., which is not affiliated with Epoch.

(5) Russell 3000 Value Index is a trademark of Russell Investments, which is not affiliated with Epoch.

Company Impact and Outlook

The equity market rally enhanced our revenue stream and increased our AUM by approximately $1.1 billion during the three months ended September 30, 2009. The Company continues to acquire new flows, from both new and existing clients.

Despite the recent stock market gains, we continue to be cautiously optimistic. Management remains focused on ways to further develop our existing distribution channels. We continue to review and revise our cost containment and expense management policies, ensuring that operating costs are monitored, assessed and aligned with our business strategy. Above all, we continue to seek to identify value creating opportunities for our clients, our employees, and our shareholders.

Assets Under Management and Flows ("AUM")

The following table sets forth the changes in our AUM for the periods presented (dollars in millions):

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                                                  Three Months Ended
                                                    September 30,
                                             2009                    2008
Beginning of period assets           $         7,891         $       6,634
Client Flows:
Inflows/new accounts                             983                   607
Outflows/closed accounts                        (171 )                (409 )
Net inflows                                      812                   198
Market appreciation/(depreciation)             1,093                  (747 )
Net change                                     1,905                  (549 )
End of period assets                 $         9,796         $       6,085
Percent change in total AUM                     24.1 %                (8.3 )%
Organic growth percentage(1)                    10.3 %                 3.0 %

[[Image Removed]]

(1) Net inflows divided by beginning of period assets.

For the three months ended September 30, 2009 and 2008, approximately 51% and 55%, respectively, of investment advisory and management fees were earned from services to mutual funds under advisory and sub-advisory contracts whose fees are calculated based upon daily net asset values, and approximately 49% and 45%, respectively, of fees were earned from services provided for separate accounts whose fees are calculated based upon asset values at the end of the period.

No material impact to revenues or operating results arose during the periods presented as a result of differences between the average daily AUM for the funds where our fees are calculated based upon daily net asset values and the period ending AUM for those funds.

The charts on the following page show the Company's products as a percentage of AUM as of September 2009 and 2008, respectively:

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As of September 30, 2009                                     1-Year Change                                 3-Month Change
Distribution Channel           AUM                    Amt                      %                     Amt                    %
Sub-advisory           $           5,034     $         2,213                  78.4 %         $             702               16.2 %
Institutional                      4,500               1,510                  50.5 %                     1,191               36.0 %
High net worth                       262                 (12 )                (4.4 )%                       12                4.8 %
Total AUM              $           9,796     $         3,711                  61.0 %         $           1,905               24.1 %

[[Image Removed: [GRAPHIC MISSING]]]

The following table and charts shows the Company's AUM by product, annual and quarterly changes at September 30, 2009, as well as Epoch investment products as a percentage of AUM as of September 30, 2009 and September 30, 2008, respectively (in millions):

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As of September 30, 2009                                  1-Year Change                                3-Month Change
Product                      AUM                   Amt                     %                     Amt                     %
U.S. Value           $           2,791                 1,241                80.1 %                     451                19.3 %
U.S. All Cap                     2,420                   819                51.2 %                     404                20.0 %
Value/Balanced
Global Equity                    1,762                   499                39.5 %                     247                16.3 %
Shareholder Yield
U.S. Small/Smid                  1,291                   555                75.4 %                     217                20.2 %
Cap Value
International/Int.                 469                    83                21.5 %                      73                18.4 %
Small Cap
Global Absolute                    875                   504               135.8 %                     500               133.3 %
Return/ Choice
Global Small Cap                   188                    10                 5.6 %                      13                 7.4 %
Total AUM            $           9,796                 3,711                61.0 %                   1,905                24.1 %

[[Image Removed: [GRAPHIC MISSING]]]

Results of Operations
Three Months Ended September 30, 2009 and 2008

For the three months ended September 30, 2009, the Company recorded net income of $2.3 million, an increase of $1.7 million from the same period a year ago. Basic earnings per share were $0.10 per share for the three months ended September 30, 2009, compared to $0.03 per share for the same period a year ago.

The primary drivers for the significant improvement in net income were as follows:

• Operating revenues increased by $2.9 million, or 35%, during the three months ended September 30, 2009 compared with the same period a year ago. This increase was caused by both market appreciation and continued net inflows. The Company had net inflows of approximately $3.3 billion for the twelve months ended September 30, 2009, and approximately $0.8 billion for the three months ended September 30, 2009.

• Other income increased by $0.3 million compared with the same period a year ago. The prior year comparable period included $0.3 million in realized losses on investments.

• Offsetting these increases in income was a $0.2 million increase in operating expenses from the same period a year ago. An increase in employee related costs, as well as costs related to the termination of a sublease, were the primary reasons for the overall change.

Operating Revenues:

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                               Three Months Ended                                 Change
                                  September 30,
(Dollars in                2009                  2008                    $                     %
Thousands)
Investment

The increase in revenues was attributable to the increase in AUM compared with the same period a year ago, primarily as a result of net inflows from new and existing business. Market appreciation, particularly since March 2009, also contributed to the increase in AUM. The Company had net inflows of approximately $3.3 billion for the twelve months ended September 30, 2009, and finished the period ended September 30, 2009 with AUM of $9.8 billion, a 61% increase from AUM of $6.1 billion at September 30, 2008.

The average assets under management for the three months ended September 30, 2009 was approximately $8.8 billion compared to approximately $6.6 billion for the three months ended September 30, 2008, an increase of approximately 35%. U.S. equity markets declined approximately 5 - 10% from September 30, 2008, but increased substantially since March 2009. Global equity markets performed slightly better over the past twelve months.

For the three months ended September 30, 2009, CI Investments Inc. ("CI"), a Canadian-owned investment management company, accounted for approximately 11% of revenues. For the three months ended September 30, 2008, CI accounted for approximately 14% of revenues.

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                                      Three Months Ended                                   Change
                                        September 30,
(Dollars in Thousands)           2009                    2008                     $                       %

[[Image Removed]]

NM - not meaningful

The Company recognized performance fees during the three months ended September 30, 2009 from clients whose agreements included a performance measurement period of September 30, 2009. These fee arrangements generated performance fees based upon certain pre-established benchmarks. The Company currently has incentive agreements that provide for quarterly or annual performance measurement periods.

Operating Expenses:

[[Image Removed]]   [[Image Removed]]       [[Image Removed]]       [[Image Removed]]       [[Image Removed]]
                                 Three Months Ended                                    Change
                                    September 30,
(Dollars in                 2009                    2008                      $                      %
Thousands)
Employee related
costs (excluding    $         4,516         $         4,117         $            399                  10 %
share-based
compensation)
As a percent of                  40 %                    49 %
total revenue
. . .