Federated Investors reported first quarter profits of $35.1 million, or 34 cents per diluted share, down 37% from $35.1 million, or 54 cents per diluted share, in the first quarter of 2008.

With strong sales driven by Federated’s fixed income products, assets rose 21% to $409.2 billion, up $70.7 billion from the $338.5 billion that Federated had under management in the first quarter of 2008.

“As investors increasingly sought fixed income products, Federated’s broad menu of high-quality bond funds experienced substantial growth in the first quarter,” said J. Christopher Donohue, president and CEO of Federated. “Federated sold $3.2 billion in fixed income mutual funds during the quarter, netting $1.1 billion in bond assets, marking Federated’s best quarter for net fixed income sales in more than five years.”

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