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Retirement

Bank marks plans to offload part of its advice business

  • October 25 2018
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Retirement

Bank marks plans to offload part of its advice business

By Katarina Taurian
October 25 2018

A major financial services institution has today revealed its intention to offload its New Zealand wealth management and advice businesses via an IPO.

Business meeting

Bank marks plans to offload part of its advice business

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  • October 25 2018
  • Share

A major financial services institution has today revealed its intention to offload its New Zealand wealth management and advice businesses via an IPO.

Business meeting

In a trading update this morning, AMP announced its intention to seek divestment of its New Zealand wealth management and advice businesses via an IPO in 2019. AMP said the decision to proceed with an IPO and its timing remain subject to market conditions and regulatory approvals.

“These businesses have FY18 pro forma operating earnings of approximately $40 million on a standalone basis,” the group said. “The IPO would release capital to AMP and create a standalone New Zealand wealth management and advice business.”

AMP also announced the sale of its life insurance business to Resolution Life for total cash and non-cash consideration of $3.3 billion.

“The completion of our portfolio review marks a major step forward in reshaping AMP as a simpler, more focused group, that is well positioned to compete in our core markets,” AMP acting CEO Mike Wilkins said.

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“Delivering the right outcome for customers, shareholders and employees has been our focus throughout the portfolio review.

“For customers, there will be no change to their existing insurance policy terms or conditions. They will benefit from Resolution Life’s deep expertise in managing in-force insurance policies and its commitment to customer service.

“For shareholders, the agreement with Resolution Life and our exit from wealth protection and mature delivers important strategic benefits. It substantially simplifies our portfolio, delivers certainty and frees up capital.

“For employees, it provides certainty of outcome with a business that is culturally aligned with AMP. Our highly-experienced teams supporting insurance and mature customers are expected to largely transfer with the sold businesses, delivering continuity and stability for customers.

Mr Wilkins said AMP’s incoming CEO, Francesco De Ferrari, has a mandate to transform the group and today’s announcements will create “greater flexibility” as he sets the new strategy for AMP’s simplified business portfolio.

Bank marks plans to offload part of its advice business
Business meeting
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