AMP de-merger good news for financial services
AMP’s Australian Financial Services (AFS) division yesterday attempted to placate institutional investors in light of recent negative market sentiment surrounding its de-merger, which it claims has “dented” its brand.
AFS managing director Craig Dunn at a financial services conference yesterday defended AFS, saying that the division was demonstrating resilience and was positioned for long-term growth despite times being tough at present.
Dunn said that although outflows from AFS were up 10 per cent on 2002 figures, it should be considered in the context of an industry suffering from significant market downturn.
AMP’s poorly performing UK business has bled and impacted on the broader group’s performance causing it to recently propose a de-merger of the UK and Australian operations.
However, Dunn said that the slated split would provide a simpler, more transparent corporate structure and appeal to a broader group of investors, and most importantly protect and enhance its Australian brand.
Dunn revealed that planner numbers within the AFS division have remained largely stable, althoughAMP Financial Planningrecently had cause to announce a $5 million package to support its ‘hard-hit’ financial planners.
The package involved a 10 per cent reduction in the dealership fee charged to AMP planners, communication support for planners educating clients about the UK de-merger as well as performance-based reward payments.
The growth of the division will come as a result of distribution power, deals with new dealer groups for both organic and inorganic growth, and systemic growth, according to Dunn.
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