AMP has posted a 24.5 per cent decline in net profit for the first half to $117 million, with falls for AMP Bank and the firm’s wealth management operations in Australia and New Zealand.
In its first-half results released on Thursday, AMP reported that the underlying net profit of its Australian Wealth Management (AWM) business dropped 20.0 per cent to $36 million.
According to the firm, AWM’s earnings had fallen due to strategic repricing in North and Master Trust to provide competitive offers, which it said were largely offset by cost reductions and improvements in advice.
The total assets under management of AWM decreased by 11 per cent to $126.3 billion, which AMP said primarily reflected negative investment market returns during the half.
Within AWM, an underlying NPAT loss of $30 million was recorded for Advice, down from the $85 million loss seen in the first half of the previous financial year, along with a $7 million increase in revenue to $30 million.
Additionally, the NPAT of Platforms fell from $66 million to $36 million and the NPAT of Master Trust dropped from $63 million to $27 million.
“While our profit has declined on 1H21 due to a more challenging environment, it is also a reflection of the deliberate actions we took to reprice our offers in Master Trust and Platforms to continue delivering competitive offers to customers and set AMP up for longer-term success,” commented AMP CEO Alexis George.
“Despite the decline in investment markets and anticipated margin compression, we delivered disciplined cost savings that have supported our earnings.”
Meanwhile, AMP Bank recorded a 45.2 per cent net profit fall to $46 million.
The net interest margin (NIM) of AMP Bank fell from 1.62 per cent to 1.32 cent, which AMP said was driven by mortgage margin compression, growth of fixed-rate loans and holding higher liquid assets. Total deposits were up 12 per cent to $20.0 billion
“AMP Bank continues to show its competitive strength as a digitally enabled challenger bank with above-system mortgage growth, while maintaining disciplined focus on credit quality,” commented Mr George.
AMP said that its statutory net profit rose to $481 million, up from $146 million in the first half of the 2021 financial year, mainly due to the sale of its infrastructure debt platform.
The firm also announced it will return $1.1 billion of capital to shareholders, including a $350 million on-market share buyback followed by $750 million of capital returns planned for the 2023 financial year.
“We have built strong momentum on the transformation of AMP into a simpler and more efficient organisation which is well placed to grow,” said Mr George.
“The agreed sales of the Collimate Capital businesses are on track to complete in the second half of the year. Post completion, there will be a renewed focus for AMP as a leading wealth management and banking business in Australia and New Zealand.”
Funny to see Alexis saying that they want to support their advisers all while there is a class action against them from all the advisers that they booted after changing contract terms.
Hopefully the profit will continue to decrease to zero and this pathetic organisation will disappear.
Email me Alex, gmail is fine.
“We have built strong momentum on the transformation of AMP into a simpler and more efficient organisation which is well placed to grow,” said AMP CEO Alexis George.
Should be very simple to manage once you get it down to no advisers and no FUM.
With a bit of luck they will streamline themselves out of a job
ring ring…ring ring….hello?…….Is that Fransesco de Ferrari?….yes, speaking.
Id like to ask you a few important questions regarding AMP.
click……hello, hello Mr de Ferrari….are you there ?
Ha ha…..when will Alexis stop answering the phone? Before 31 December or will she make it through to 30 June 2023?
So they booted their advisers and then reduced their pricing to try stop the departed advisers from rolling out clients’ funds and now their profits are nose-diving. What did they think would happen?
AMP & IOOF – such terrible treatment of their planners and now they start reaping their rewards
Good luck Alexis, you were sold a basket case.