Slide 1: AMP Full Year Financial Results announcement cover
For personal use only 14 February 2019 Manager Client and Market Services Team ASX Market Announcements NZX Limited Australian Securities Exchange Level 1, NZX Centre, 11 Cable Street Level 4, 20 Bridge Street PO Box 2959 Sydney NSW 2000 Wellington, New Zealand AMP Limited (ASX/NZX: AMP) Full Year F
Slide 2: 2018 full year results
amp ZS 2018 full year results Francesco De Ferrari, Chief Executive Officer Gordon Lefevre, Chief Financial Officer For personal use onl 14 February 2019
Slide 3: AMP – helping people own tomorrow
AMP – helping people own tomorrow For personal use only Notes 1. All data relates to FY 18 2
Slide 4: Agenda
Agenda 1. FY 18 results 2. FY 18 earnings rebase 3. AMP of tomorrow and 2019 priorities
Slide 5: FY results
For personal use only DRAFT NUMBERS; UNAUDITED; SUBJECT TO CHANGE
Slide 6: FY profit summary
FY 18 profit summary For personal use only A$m FY 18 FY 17 % Australian wealth management¹ 363 391 (7.2) AMP Capital2 167 156 7.1 AMP Bank 148 140 5.7 New Zealand wealth management¹ 53 54 (1.9) Retained business operating earnings 731 741 (1.3) Australian wealth protection (176) 110 n/a New Zealand
Slide 7: Australian wealth management
Australian wealth management For personal use only Cash outflows Key performance measures FY 18 FY 17 during challenging Investment-related revenue (A$m)1 1,213 1,263 period; earnings resilient Other revenue (A$m) 96 108 Operating earnings (A$m) 2 363 391 Controllable costs (A$m) (462) (490) Average
Slide 8: New Zealand wealth management
New Zealand wealth management For personal use only Stable New Zealand FY 18 FY 17 performance; strong earnings Operating earnings (A$m) 1 53 54 growth from the Controllable costs (A$m) (33) (32) advice channel Average AUM (A$b)2 11.1 10.5 Total net cashflows (A$m) 83 220 Operating earnings to AUM (
Slide 9: AMP Bank
AMP Bank For personal use only Solid performance Key performance measures FY 18 FY 17 in slower housing market Operating profit (A$m) 148 140 Controllable costs (A$m) (95) (80) Cost to income ratio 31.0% 28.6% Net interest margin 1.70% 1.70% Residential mortgage book (A$m) 19,460 18,870 90+ day mort
Slide 10: AMP Capital
AMP Capital For personal use only Strength in real Key performance measures FY 18 FY 17 assets; continued investment in Operating earnings (A$m)1 167 156 international Fee income (A$m) 708 659 growth Controllable costs (A$m) (453) (412) Cost to income ratio 62.3% 61.5% Total net cashflows (A$m) (2,7
Slide 11: Sold businesses – overview
Sold businesses1 – overview For personal use only Deterioration of Key performance measures FY 182 FY 17 wealth protection Notes 1. Businesses subject to a claims experience in Profit margins (A$m) 269 303 sale agreement with Resolution Life (“sold a challenging market Experience profits / (losses)
Slide 12: Controllable costs
Controllable costs For personal use only A$m – FY 18 controllable costs (ex AMP Capital) below guidance. Investment in – Stranded costs of approximately A$40m (after tax), A$57m (pre-tax) AMP Bank offset by cost reductions including: relating to sold businesses; costs to be removed by the end of the
Slide 13: Key financial items outside business unit results
Key financial items outside business unit results For personal use only A$m FY 18 FY 17 Underlying profit 680 1,040 Advice remediation and related costs (469) - Royal Commission (32) - Portfolio review and related costs (48) (24) Risk management, governance and controls (8) - Other items (74) (21) A
Slide 14: Capital adequacy, funding and liquidity
Capital adequacy, funding and liquidity For personal use only A$m FY 18 FY 17 Shareholder equity 6,683 7,276 Less: goodwill and other intangibles (3,560) (3,475) Less: other deductions (129) (173) Plus: subordinated bonds eligible as level 3 capital 83 83 Level 3 eligible capital 3,077 3,711 Minimum
Slide 15: Capital position
Capital position For personal use only A$m 154 680 2,338 (469) (155) (188) 1,651 (651) 1,534 (58) (117) – Active capital management continued; New Zealand reinsurance – FY 18 Level 3 capital in excess of MRR (A$1.5b post final dividend) is tranche executed in Q4 18 releasing A$154m in line with Boar
Slide 16: FY earnings rebase
FY 18 earnings rebase Section 2
Slide 17: FY earnings rebase
FY 18 earnings rebase For personal use only FY 18 Sold businesses Proforma Other FY 18 10 A$m reported earnings adjustments adjustments rebased Australian wealth management 363 (85) 2 (75)5,6 203 AMP Capital 167 167 AMP Bank 148 (10) 6 138 New Zealand wealth management 53 (12) 2 41 Retained business
Slide 18: 2019 priorities
ns i o = 0 6 = g 2019 priorities Sectio
Slide 19: Transforming AMP
Transforming AMP For personal use only Board renewal Executive change Consequence management – David Murray AO appointed Chairman – New CEO appointed – Clear remuneration consequences AMP Limited – New CEO Australian wealth management – Forfeiture of short and long-term incentives – Three highly-exp
Slide 20: Unique opportunity to redefine AMP
Unique opportunity to redefine AMP For personal use only Australian wealth New Zealand wealth AMP Bank AMP Capital management management Strengths – Largest financial advice – Strong advice network – Competitive core offering – Recognised as a leader network1 – Leading KiwiSaver provider – Low-cost
Slide 21: 2019 priorities
2019 priorities For personal use only Position to win across core Towards structural transformation operating businesses Separate Australia and New Zealand wealth protection and mature Transform Australian wealth management – Drive legal separation for end Q3 19 – Reshape advice network and improve
Slide 22: For personal use only
For personal use only
Slide 23: For personal use only
For personal use only
Slide 24: Guidance summary
Guidance summary For personal use only Australian wealth management Investments – Including the MySuper repricing, and subject to any further regulatory impacts and – Economic interest in mature business expected to deliver future earnings of management initiatives, underlying margin compression is
Slide 25: Resolution Life transaction: financial impacts and timing
Resolution Life transaction: financial impacts and timing For personal use only As announced on 25 October 2018, Resolution Life assumes the risks and profit impacts of the Australian and New Zealand wealth protection and mature businesses from 1 July 2018, subject to AMP’s share of risks and AMP’s
Slide 26: AMP's advice network – Australia
AMP’s advice network – Australia For personal use only Target Advisers Total AUM ($m)5 AUM per adviser ($m) Channel Analysis market Dec 18 Dec 17 Dec 18 Dec 17 Dec 18 Dec 17 AMP Advice1 Goals-based 233 226 13,788 15,302 59.2 67.7 AMP Financial Planning2 1,334 1,437 56,774 59,427 42.6 41.4 Core Chart
Slide 27: North AUM – five year summary
North AUM – five year summary For personal use only 24% compound annual growth rate in North platform AUM 37.9 34.9 27.1 20.9 16.0 FY14 FY15 FY16 FY17 FY18 AUM (A$b) 26 Section 4, AMP 2018 full year results
Slide 28: AMP Bank residential mortgage growth – five year summary
AMP Bank residential mortgage growth – five year summary For personal use only 9% compound annual growth rate in residential mortgages 19.5 18.9 16.5 14.0 14.6 FY14 FY15 FY16 FY17 FY18 Residential mortgages (A$b) 27 Section 4, AMP 2018 full year results
Slide 29: AMP Capital real assets external AUM – five year summary
AMP Capital real assets external AUM – five year summary For personal use only 20% compound annual growth rate in real assets external AUM 43.6 35.2 29.2 25.9 25.1 21.3 22.9 19.5 17.0 15.6 17.8 12.3 8.1 9.7 5.7 FY14 FY15 FY16 FY17 FY18 Infrastructure Real estate (A$b) 28 Section 4, AMP 2018 full yea
Slide 30: AMP Capital – international growth
AMP Capital – international growth For personal use only Global Partnerships China Life AMP Asset Management (CLAMP)¹ − AUM grew 10.1% (from FY 17) in local currency terms to RMB 201.7b (A$41.7b) − Launched 17 new products year-to-date including separately managed accounts, diversified, equity and b
Slide 31: AMP Group Leadership Team
AMP Group Leadership Team For personal use only New GLT structure effective 4 March 2019 30 Section 4, AMP 2018 full year results
Slide 32: Key Royal Commission recommendations relevant to AMP
Key Royal Commission recommendations relevant to AMP For personal use only – AMP has embraced the need for change and has already taken significant – AMP will work constructively with the government, regulators, advisers, action to improve culture, governance, accountability and processes across tru
Slide 33: Legislative and regulatory environment
Legislative and regulatory environment For personal use only Proposed reform AMP position Royal Commission into misconduct in the Banking, − AMP will work constructively with government and other stakeholders to ensure that, as the recommendations Superannuation and Financial Services industry move
Slide 34: Important disclaimer
Important disclaimer For personal use only Forward-looking statements in this presentation are based on AMP’s current views and assumptions and involve known and unknown risks and uncertainties, many of which are beyond AMP’s control and could cause actual results, performance or events to differ ma