EXTERNAL ENVIRONMENT: OPPORTUNITIES & THREATS

Societal Environment:Demographics

Opportunity

Changing face of America Asia largest immigrant group Millennial takeover Women’s role in labor force Married vs. single World is aging

EconomicsOpportunity

Dependent on consumer, business and government spending. Demand is elastic Slow recovering economy

Political/ / LegalThreat

Regulated by federal, state and foreign entities. New president uncertainty Lawsuits: (1) CheckFree Corp and CashEdge Inc. (2)

DataTreasury Corp. Electorate shift

Socio-CulturalThreat

Risk society thesis Stagnate wages Declining Christian population

Technical Opportunity Software dev. and R&D costs continue to fall due to advances in tech.

Global Opportunity Expansion into foreign markets allows more control of the market share

Porter’s 5 Competitive Forces1. Threat of New Entrants: Low threat due to high capital investment Compliance with all regulations2. Bargaining Power of Buyers: Moderate threat due to less sensitivity of interest rates Freedom to switch personal accounts to other banks3. Threat of Substitute Products: High threat due to better alternative investments Financial sector is large in terms of products and services4. Bargaining Power of Suppliers: Moderate threat due the attraction of people to save $$$ Low cost of switching suppliers5. Rivalry Among Competitive Forces: High threat due to competing forces among banks Customers perceived value towards satisfaction

New En

trants

Buyer

Bargain

ing

Subst

itutes

Supp

lier Barg

aining

Rivalry

1

2.5

4

3

4.5

Porter's 5 Chart

Competitive Forces

Low

Hig

h

DRIVING FORCES

DRIVING FORCES

ECONOMY

REGULATION

PROTECTION OF INTELLECTUAL

PROPERTYIT SECURITY

COMPETITION

STRATEGIC GROUP MAP

HIG

H

LOW HIGH

LOW

DEG

REE

OF

INTE

RGRA

TIO

N

DEGREE OF AFFILIATION

BOSTON CONSULTING GROUP MATIRX

LOW

HIGH

LOWHIGH

BOND FUNDS

FIXED INCOME ETFs

FIXED INCOME ANNUITIES

MONEY MARKET FUNDS

STAR QUESTION MARK

COW DOG

COMPETITOR ANALYSIS

FINANCIAL COMPANY

2015 REVENUE

NET INCOME TOTAL ASSETS TOTAL EQUITY

VANGUARD 365 BILLION 3 TRILLION 3.1 TRILLION 16 TRILLION

CHARLES SCHWAB

6.05 BILLION 1.321 BILLION 154 BILLION 11.8 TRILLION

FIS 6 BILLION 2.1 TRILLION 5.05 TRILLION 800 BILLION

AMERITRADE 3.247 BILLION 813 MILLION 26.37 BILLION 4.9 BILLION

ETRADE 1.428 BILLION 268 MILLION 45.42 BILLION 5.799 BILLION

SCOTTRADE 776 MILLION 292 MILLION 15.78 MILLION 6.1 MILLION

TRADEKING 50 MILLION 8.9 MILLION 4.5 MILLION 1.3 MILLION

KEYS TO SUCCESS

Protect intellectual property

Develop superior information security

Develop better client management

Develop new Innovation & R&D

ADDITIONAL KEYS TO SUCCESS

Attract and acquire other firms

Develop better internal & external communication

Attract the millennial generation

Develop web more advance web content

INDUSTRY ATTRACTIVENESSLargest global provider in banking and payment technologiesInnovative payment processing & banking solutionsFIS serves more than 20,000 clients in over 130 countries

Conducts billions of transactions annually

INDUSTRY ATTRACTIVENESSMoves over $9 trillion around the globe

Fortune 500 company

Member of Standard & Poor’s 500® Index

2016 Fortune’s most admired companies

In short, yes.*FIS is currently the leader in financial

research & development

* Largest bill, EFT and mobile pay system in

the world

* Most rapid online growth

compared to its competitors

*Evolutionary process of

mobile payments*Strategic partners

integrated around the

globe

CAN FIS REMAIN RELATIVE AND COMPETITVE?

Societal Environment:

• Government Regulation• Protection of Intellectual Property• Information Security• R&D• Competition• Sales & Marketing• Employees

General environmental forces affecting FIS and the financial service industry:

Government Regulations

Banking Regulation Oversight SEC & FINRA Regulations Privacy Regulations Cash Access Practices Consumer Protection & Reporting Anti-Corruption Practices Debt Collections

Banking Regulation Oversight

Multi-Region Data Processing Servicer Program (MDPS)

FFIEC FDIC Office of the Comptroller of the Currency Board of Governors of the Federal Reserve National Credit Union Administration

SEC & FINRA Regulations

The Security Exchange Commission and the Financial Industry Regulatory Authority regulate and oversee FIS’s registered broker-dealer(s).

Adopts and enforces rules governing: Conduct Activities Members of its firms

Broker-dealers regulation Sales methods Trade practices Private and public offerings The use of clients funds and securities Capital structure Record keeping The financing of client's purchases Conduct of the organization

Privacy Regulations

Clients are restricted by regulations on the use of non-public personal information

FIS discloses privacy policies to all their clients for 3rd party use FIS is bound by the same limitations on disclosure of the information

received by their clients FIS is also subject to various legal requirements abroad

Consumer Reporting and Protection

FIS’s retail check authorization services are conducted by Certegy Check Services

ChexSystems maintains FIS’s databases of consumer information The Federal Credit Reporting Act imposes requirements on FIS for:

The Right to know Dispute Accuracy & Removal Verification Requirements Fair Treatment of Consumers

CFPB UDAAP

Debt Collection Practices

All collection services are subjected to the Federal Fair Debt Collection Practices Act. Debt collection means include: Bank Check Credit Card Debit Card

The FTC and the U.S. attorneys have the responsibility of enforcing said debt collection and various credit reporting laws.

Protection of Intellectual Property

FIS currently owns trademarks, trade names, copyrights and patents which is crucial to the future success of the company

FIS relies on the following to protect their software, technology and expertise worldwide: Contractual Restrictions Internal Security Practices Applicable Laws

Information Security

FIS experiences global attacks on its information infrastructure frequently and is growing with every passing year in sophistication and in complexity

Competitors and government entities are usually a point of focus These indicators have presented a clear and present threat to FIS FIS participates in industry and government related initiatives to

improve upon the security of its clients Developed fraud, security, risk management and compliance

solutions

Research & Development

Developed processing systems and software applications in risk management platforms

Develops innovative software to address emerging technology trends Annual evaluations of existing hardware and software platforms FIS uses 3rd party software for highly specialized business functions FIS currently invests 3% of its revenues into R&D

Competition

The markets for the solutions and services are indeed very competitive Primary competitors are:

Internal technology departments (financial institutions & retailers) Software development departments (large computer manufacturers) Integrated financial service companies 3rd party payment processors Asset managers Trust companies Independent computer service firms Technology consulting firms Business process outsourcing companies

Competition

Competitive Factors Quality of technology based applications or services Application features and functions Ease of delivery and integration Price and relationship management

Sales and Marketing Buying behavior trend of financial services sector clients

Movement from a single product to integrated solutions that suit a particular service and market FIS has experienced sales staff with expertise in:

Particular services Particular markets Particular clients

Expertise focus: Global financial institutions North American financial institutions Tailored markets

Global marketing strategy Message development Internal & external communications Client management Web content creation Trade shows Demand generation campaigns Collateral development & management

Employees

55,000 U.S. employees 34,000 foreign employees None of FIS U.S. employees are unionized 12,000 foreign employees are unionized Relations with employees are considering to be stable and good

Risk Factors

Entity mergers Consolidations Failure in the banking and financial service industry

Would become more dependent on current clients Would be more susceptible to the loss of clients

Failure to adapt and innovate Loss of clients Difficulty attracting new clients Cost overruns Delay in delivery Performance issues

Risk Factors

Competitive business environment Substantial resources Direct competition from 3rd parties

Clients in-house capacities Versus-buy perspective

New competitors New technologies Market pressures

Risk Factors

Global economic & political conditions Business cycles Consumer confidence Consumer spending Government spending Unstable interest rates in foreign countries