AMP’s wealth management arm saw nearly $4 billion in client money leave its books in the past financial year, largely as a result of reputational damage from the financial services royal commission.
For context, the previous year, it had added $931 million in inflows.
Statutory net profit for the year imploded by almost 97% to $28 million, a slight miss on analysts’ expectations of around $31 million, and down from the previous year’s $848 million.
The firm is setting aside $430 million (post-tax) in remediation provisions — the costs for establishing who is owed what from its fee structures that were a focus of the Hayne royal commission proceedings. The revelations during the hearings last year — including how it misled the corporate regulator when questioned — led to the abrupt departure of the CEO and chair last year.
Superannuation assets under management declined from $79.88 billion to $74.2 billion.
AMP chief executive Francesco De Ferrari said: “The Royal Commission has been a confronting but valuable experience for the financial services industry and has served as a catalyst for change at AMP. We have undertaken Board and leadership renewal, accelerated client remediation and sharpened our focus on delivering better value to customers including reducing fees on our MySuper products.”
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