Trading Update

City of London Investment Group PLC
11 June 2007


For release at 0700h, 11 June 2007


                      CITY OF LONDON INVESTMENT GROUP PLC

                       ('City of London' or 'the Group')


TRADING UPDATE FOR THE YEAR TO 31 MAY 2007


City of London Investment Group PLC (AIM: CLIG), a leading emerging market and
closed end fund asset management group, today provides a trading update for the
financial year ended 31 May 2007.

The Group's funds under management (FUM) increased by 38% during the year to
US$3.792 billion at 31 May 2007 (US$2.748 billion at the end of May 2006).

For the year to 31 May 2007, City of London expects that pre-tax profits will be
approximately 41% higher at £7.3 million (2006: £5.2 million) and that profits
after tax of £2.4 million will be approximately £4.9 million (2006: £2.9 million
after AIM admission costs of £0.5 million and tax of £1.8 million).

The Group's dividend policy is based on paying dividends to shareholders that
are twice covered by earnings and to pay one third of the annual total as an
interim dividend and two thirds as a final dividend.  In March 2007, City of
London paid an interim dividend of 3p per share, implying a final dividend of 6p
under the policy adopted by the Group.  In the event, it is the Board's
intention to recommend a final dividend of 7p per share as a result of the
financial performance of the Group in the second half of the financial year.

Notwithstanding City of London's performance over the past year it is the
Group's intention over the next year, subject to market conditions, to continue
to grow and diversify the business organically. Progress in the US is
anticipated regarding the equity business and the intention is to focus
resources in the area of marketing the Natural Resource fund. Additionally, two
new spokes will be added to the Group's Dublin based OEIC, The World Fund. These
are Natural Resources and Emerging Markets Yield.

With regard to the traditional emerging markets closed end fund business,
further growth is expected from winning new mandates, particularly in Europe, as
a result of the successful focus upon outperformance relative to benchmarks.
Another area of diversification and focus over the next year will be regarding
closed end funds that provide global exposure.

Financial discipline is being maintained. As a result of tight control of
overhead, the cost-income ratio, excluding variable commissions and
profit-share, reduced from 38% to 34%, and the portion of gross income which is
carried to the bottom line (pre-tax) increased from 37% to 40%.

City of London expects to announce full year results for the year to 31 May 2007
on 17 September 2007.

Summary and Trading Update
                                                        31.05.06       31.05.07
Funds under Management (at period end)                   $2.8bn         $3.8bn
Turnover (plus investment income)                        £14.2m         £18.4m
Administrative expenses                                   £9.5m         £11.1m
Profit before tax                                         £4.7m          £7.3m
Profit after tax                                          £2.9m          £4.9m
EPS:      Basic                                           13.5p          19.9p
          Diluted                                         11.7p          17.5p

Financials - P&L Account
                                                      Year to 31 May
£'000                                                      2006           2007
Fee income                                               14,119         18,317
Interest & other                                            109            230
Finder's commission                                      (2,180)        (2,723)
Custody & Administration                                   (523)          (613)
Total net income                                         11,525         15,211

Costs:
Human resources                                           2,588          2,998
Premises                                                    220            217
Communications & IT                                         617            645
Business development                                        229            283
General                                                     501            583
Total costs                                               4,155          4,726
Operating profit                                          7,370         10,485

AIM listing costs                                           483              0
Profit-share                                              2,160          3,153
Pre-tax profit                                            4,727          7,332

Tax                                                      (1,784)        (2,478)
Post-tax profit                                           2,943          4,854
Dividends                                                (2,283)          (736)*
Retained                                                    660          4,118


* Shows interim dividend only; final dividend to be approved.

                                     -ends-


City of London Investment Group is today hosting a seminar on the background to
its results, focusing on the macroeconomic outlook for emerging markets, current
trends in corporate governance in the closed end funds sector and City of
London's approach and strategy, at the offices of Tavistock Communications, 131
Finsbury Pavement, London EC2A 1NT. The seminar will commence at 1000h, finish
at 1300h and will conclude with an informal discussion over lunch. The output
from the seminar will be available upon request from [e-mail]
(tel: [phone]).


For further information, please visit www.citlon.co.uk or contact:

Doug Allison (Finance Director)          Simon Hudson / John West / Andrew Dunn
City of London Investment Group PLC      Tavistock Communications
Tel: [phone]                       Tel: [phone]



NOTES TO EDITORS


City of London is an asset management group whose principal activity is
providing emerging market asset management products and services predominantly
to institutional investors via its principal operating company City of London
Investment Management Company Limited. The Group is based in the UK and also has
offices in the US and Singapore. Clients include some of the US's leading blue
chip institutions and endowment funds.


With total funds under management of approximately US$3.8 billion, the Group
manages several Open Ended Funds as well as a number of segregated accounts. The
Group's fund mandates are mainly in emerging markets, although the Group has
more recently diversified its asset management product portfolio by the launch
of a natural resources fund and has also seeded three new funds: a global fund,
a frontier fund and an emerging markets yield fund. The Group seeks to provide
capital growth for clients through active country allocation and stock
selection.






                      This information is provided by RNS
            The company news service from the London Stock Exchange