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AMP HY profit slips 15pct to $445m

Simone Ziaziaris  |  10 Aug 2017Text size  Decrease  Increase  |  

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SYDNEY - [AAP] Financial services giant AMP Limited's (ASX: AMP) first-half statutory profit has slipped 15 per cent to $445 million, on the back of volatile market movements.

But, underlying profit for the six months to June 30 was up 4 per cent on its previous first half, at $533 million, driven by strong operating earnings, while ordinary activities revenue grew 25 per cent to $7.6 billion.

In February, the wealth manager booked a full-year loss of $344 million--its worst result in 13 years--on the back of a restructure in its wealth protection arm.

On Thursday however, AMP said actions undertaken to stabilise and reset its wealth protection business had delivered an 11 per cent boost in the unit's operating earnings.

The company also announced a series of reinsurance agreements for its wealth-protection business, which it expects will release about $500 million in capital from AMP Life, subject to regulatory approval.

It comes following a deal with Germany's Munich Re last October to stabilise the struggling unit, chief executive Craig Meller said on Thursday.

The new agreements are set to start in November and, combined with the first tranche of reinsurance completed in 2016, will mean 65 per cent of AMP's retail life insurance portfolio will be reinsured for claims, the company said.

Mr Meller said the move would reduce earnings volatility.

The financial service giant declared a partially franked interim dividend of 14.5 cents.

AMP'S INTERIM PROFIT SLIP:

* Net profit down 15pct to $445 million

* Underlying profit up 4pct to $533 million

* Revenue up 25pct to $7.6 billion

* Interim dividend of 14.5 cents, partially franked

 

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