Both AMP’s wealth management arm and AMP Capital’s net profit after tax (NPAT) were down during the first half of the 2021 financial year compared to 1H 20.
In its half-yearly results announced to the Australia Securities Exchange (ASX), AMP Australia posted an NPAT of $48 million during 1H 21, down 17.2% from the previous corresponding period. Similarly, AMP Capital’s NPAT decreased 18.7% to $61 million during the same period.
The firm also confirmed the board had decided not to declare an interim 2021 dividend, and that the capital management strategy and payment of dividents would be reviewed after the completion of the demerger with AMP Capital.
On AMP Australia, the wealth management arm, AMP said its NPAT was down due to the impact of pricing, legislative changes and advice practice impairments, but partially offset by lower variable and controllable costs form cost reduction initiatives.
its assets under management (AUM) increased 6% to $131.2 billion as it was driven by strong investment markets though earnings were impacted by pricing and legislative changes.
Its North platform AUM was up 10% to $57 billion from $51.6 billion during FY 20 following a reduction in fees and ongoing expansion of managed portfolio offers.
On the AMP Capital side, its NPAT decrease was primarily from the absence of performance and transaction fees which it said varied period to period.
The announcement noted its total cost of its client remediation program for those under the inappropriate advice program would cost a total of $823 million, with $596 million representing payments to customers. This was up from the original estimate of $778 million.
It said to date, $35 million had been paid to customers, with a further $5 million offered but not yet paid. Customers had so far received $175 million in remediation under the fee-for-no-service program.