St. Louis Public SchoolsRetirement System

Annual % Change toContribution Prior Year

December 31, 2005 payment $18,632,674 0.03%

December 31, 2006 payment** $13,305,881 -28.59%

December 31, 2007 payment $16,204,917 21.79%

December 31, 2008 payment $19,091,518 17.81%

**Note: For comparative purposes, the amount shown does not reflect the COLA adjustment which was funded for 2006. The actual payment was $14,299,464.00

St. Louis Public SchoolsAnnual Pension Contributions Paidto Public School Retirement System

*Source: PSRS Investment “Flash” Report, dated 6/30/08 and PSN.

Past performance is not indicative of future performance.

A DEEPER LOOK AT EVALUATING INVESTMENT PERFORMANCE

Top performing money managers typically beat not only their comparative style index but also exhibit above median performance in their peer group for longer periods (i.e. 5 years+).

Active managers should not be expected to outperform in every month, quarter, or year. However, persistent underperformance (i.e. 5 years+) should warrant concern and a re-investigation of the manager’s process, philosophy and people.

As of 6/30/08, SLPSRS engaged 6 traditional managers with below-median peer returns for the trailing 5 years. These managers oversee a combined $197 million under management.* Three of the six underperformed more than 70% of their peers in that timeframe.

SLPSRS Worst Case Scenario

Six of the equity managers (totaling $197 million in assets) have below median performance for the 5 years ending 6/30/08.

Using only those manager’s returns and calculating the difference between their returns and the return of the median of each manager’s peer group, the dollar return differential was $9 million over 5 years.

WORST CASE SCENARIOS

*Source: PSRS Investment “Flash” Report, dated 6/30/08 and PSN.

Past performance is not indicative of future performance.

Buford, Dickson, Harper, Sparrow $21,256,989 Return amount below the median manager: ($1,000,932)

Monetary Management $61,125,673 Return amount below the median manager: ($487,443)

New Amsterdam Partners $33,350,246 Return amount below the median manager: ($825,460)

Edgar Lomax $30,415,669 Return amount below the median manager: ($2,527,300)

Systematic Financial $28,258,552 Return amount below the median manager: ($2,935,843)

Dimensional Fund Advisors $22,571,984 Return amount below the median manager: ($1,579,047)

Total Assets for Worst Case Managers $196,979,113 Combined amount below the median manager: ($9,356,025)

Quartile Report Slides

QUARTILE RANKING BAR

PSN LARGE CAP GROWTH

JUNE 30, 2003 TO JUNE 30, 2008

-20

-15

-10

-5

0

5

10

15

20

RA

TE

OF

RE

TU

RN

1 Year 3 Years 5 Years

HIGH (0.05) 6.74 13.04 14.79

FIRST QUARTILE -1.16 8.68 10.43

MEDIAN -4.64 6.58 8.76

THIRD QUARTILE -8.20 4.81 7.33

LOW (0.95) -13.00 2.10 5.24

MEAN -4.31 6.78 8.98

VALID COUNT 397 370 340

Buford Dickson Core Momentum Gr

Monetary Mgmt. LCG

INTECH Large Cap Growth

1 Year 3 Years 5 Years

VALUE RANK VALUE RANK VALUE RANK

-0.01 18 7.11 44 7.86 63

-2.20 33 5.62 64 8.63 52

-3.47 40 5.30 66 9.18 42

QUARTILE RANKING BAR

PSN MID CAP GROWTH

JUNE 30, 2003 TO JUNE 30, 2008

-25

-20

-15

-10

-5

0

5

10

15

20

25

RA

TE O

F R

ETU

RN

1 Year 3 Years 5 Years

HIGH (0.05) 7.14 16.54 18.14

FIRST QUARTILE 0.16 12.43 14.56

MEDIAN -4.94 10.05 13.18

THIRD QUARTILE -9.43 7.64 11.00

LOW (0.95) -15.27 3.83 7.54

MEAN -4.46 9.84 13.01

VALID COUNT 176 162 144

New Amsterdam Mid Cap Grow Act

1 Year 3 Years 5 Years

VALUE RANK VALUE RANK VALUE RANK

0.16 25 8.11 70 12.69 59

QUARTILE RANKING BAR

PSN LARGE CAP VALUE

JUNE 30, 2003 TO JUNE 30, 2008

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

RA

TE

OF

RE

TU

RN

1 Year 3 Years 5 Years

HIGH (0.05) -3.57 10.76 14.85

FIRST QUARTILE -11.31 6.67 10.91

MEDIAN -15.14 5.00 9.61

THIRD QUARTILE -18.44 3.22 8.05

LOW (0.95) -27.24 -0.87 5.10

MEAN -15.03 5.05 9.57

VALID COUNT 369 352 307

Edgar Lomax Large Cap Value

Chicago Equity LgCap Value Xtnd

1 Year 3 Years 5 Years

VALUE RANK VALUE RANK VALUE RANK

-18.74 77 3.62 70 7.94 76

-17.06 62 4.64 53 9.98 42

QUARTILE RANKING BAR

PSN SMALL CAP VALUE

JUNE 30, 2003 TO JUNE 30, 2008

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

RA

TE O

F R

ETU

RN

1 Year 3 Years 5 Years

HIGH (0.05) -5.01 12.20 18.45

FIRST QUARTILE -13.33 7.24 13.61

MEDIAN -18.28 4.20 12.09

THIRD QUARTILE -22.14 1.52 10.22

LOW (0.95) -29.44 -2.38 7.00

MEAN -17.67 4.38 12.24

VALID COUNT 247 235 213

Systematic Fin. SCV

1 Year 3 Years 5 Years

VALUE RANK VALUE RANK VALUE RANK

-18.35 50 6.30 33 9.92 80

QUARTILE RANKING BAR

PSN SMALL CAP CORE

JUNE 30, 2003 TO JUNE 30, 2008

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

RA

TE O

F R

ETU

RN

1 Year 3 Years 5 Years

HIGH (0.05) -2.91 12.21 16.65

FIRST QUARTILE -12.96 6.86 13.09

MEDIAN -16.49 4.15 11.46

THIRD QUARTILE -19.20 2.40 10.28

LOW (0.95) -26.44 -1.29 7.56

MEAN -15.93 4.68 11.69

VALID COUNT 165 151 130

Russell 2000

1 Year 3 Years 5 Years

VALUE RANK VALUE RANK VALUE RANK

-16.19 45 3.79 60 10.29 74