Trading Update

27 May 2010

Lombard Risk Management plc

("Lombard Risk" or the "Company")

Trading Update

Lombard Risk Management plc (AIM: LRM), the global provider of specialised software solutions that improve the management of collateralised trading, liquidity and regulatory compliance, today announces the following Trading Update.

Revenues for the year ended 31 March 2010 will be in excess of revenues for the previous year, but will show an accounting loss greater than that of the previous year. Net cash at that date was slightly over £700k, being the bank balance at that date. There were no bank borrowings or other borrowings.

The Board considers that the trading outlook for the Company is encouragingly positive. As at 30 April 2010, the Company's order book (defined as the total expected first year recognised revenue from each contract or order received, less the amount of revenue already recognised from that contract or order received excluding all recurrent revenue) stood at a record level of £4.4m, compared with a level of around £2.6m on 30 April 2009, a rise of around 70%. Moreover, the level of this order book has continued to rise in May.

A particular feature of the last few months has been the rising level of regulatory business in the UK owing to the new Liquidity Regulations. As a result, over 20 contracts or orders have already been won and the Board expects to win more.

Although contracts or orders have now been received in excess of £3.5m since November 2009, with further orders expected, only £0.5m of this revenue had been recognised by 31 March 2010. In addition to one off licence and services revenue, an important feature of the last few months is that once all projects not finished by 31 March 2010 are completed, over £0.7m of recurrent revenue should be added to Lombard Risk's recurrent revenues, which were around £4.4m at 31 March 2010. Furthermore, the Board anticipates that projects still to be won will continue to add to this recurrent revenue number.

Lastly, the Board is happy to announce that the initial project associated with a contract announced on 7 April 2009, with a top tier Continental European bank, has now reached completion and the software has been accepted, with additional work commissioned by the bank concerned. A further news release will be made on this once we can disclose the name of the bank.

Final Results for the year ended 31 March 2010 are expected to be released shortly after 28 July 2010. More detailed updates on current trading will be announced at that time.

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