Shares in financial services giant AMP hit a new all-time low on Thursday after it reported more outflows in the March quarter from its shrinking wealth and asset management businesses.
AMP reported net cash outflows of $1.5 billion in its wealth management business and $1.3 billion in outflows from AMP Capital.
Investors went blargh and sold the shares down the new low of $1.105. They later struggled back to end at $1.125, down more than 3% on the day.
That takes the fall in the share price to around 28% so far this year.
While total assets in AMP’s wealth business increased by $1.6 billion to $125.7 billion during the quarter to reflect improved investment markets while AMP Capital’s total assets shrunk by 1.7% to $186.5 billion, mostly due to the outflows and asset sales.
This reflects net cash outflows from public markets, the sale of the Global Companies capability, and its share of listed NZ REIT Precinct Properties New Zealand Limited.
AMP Capital also recorded external net cash outflows of $1.3 billion. This was driven primarily by fixed income outflows, as well as planned divestments of assets in infrastructure equity closed-end funds.
AMP Bank also reported its total loan book increased by $200 million to $20.8 billion, driven by growth in owner-occupied loans.
AMP said $448 million of the wealth management outflows were regular pension payments to clients.
Outgoing CEO Francesco De Ferrari said in a statement that the (overall) outflows are showing “underlying signs of improvement”, as the number of pulled corporate mandates eased.
“We saw an encouraging performance in AMP Bank, performing solidly in a highly competitive market with sustained loan book growth. It’s also pleasing to see clients impacted by COVID-19 are getting back on their feet with all home loan pauses now lifted,” Mr De Ferrari said.
The quarterly update came three weeks after AMP announced Mr De Ferrari would resign and be replaced by ANZ’s deputy chief Alexis George following speculation over a leadership spill.
Mr De Ferrari will remain at the company in an advisory role to assist with the group’s transformational strategy to simplify the business. He said the company had “continued to make progress” on delivering the strategy through the first quarter.
“We are accelerating change within AMP, having made strong progress on addressing our legacy issues, including our client remediation program, which is close to 90 per cent complete. We remain focused on delivering critical priorities to progress our transformation over the next quarter and continue positioning the business for future growth.”
