Craig Meller

AMP Limited (ASX: AMP; ADR: AMLYY) yesterday reported cashflows and assets under management (AUM) for the first quarter to 31 March 2017 and provided an update on its Australian wealth protection business.

• Q1 17 Australian wealth management inflows increased 11 per cent from Q1 16 to A$6.4 billion. This was offset by a 19 per cent increase in outflows resulting in net cash outflows of A$199 million.
• Outflows primarily driven by increased consolidation activity across the superannuation sector and as customers transitioned to MySuper.
• Net cashflows on AMP retail platforms were A$188 million in Q1 17. North continues to perform well, with net cashflows up 27 per cent from Q1 16.
• AMP Capital net external cashflows of A$228 million driven by strong cashflows from China Life AMP Asset Management.
• AMP Bank’s mortgage book grew by 5 per cent over the quarter.
• Positive Q1 17 Australian wealth protection claims and lapse experience, with the business performing in line with revised assumptions.
• Cashflows strong since beginning of Q2 with wealth management net cashflows now positive year to date.

AMP Chief Executive Craig Meller said: “Q1 17 cashflows reflect an extraordinarily high level of activity across Australia’s superannuation industry as customers transitioned to MySuper prior to 1 July 2017, consolidate their funds and allocate more investments to SMSFs, amid a changing regulatory environment. As a result, both Australian wealth management cash inflows and outflows were higher.

“Cashflows into North increased, reflecting our continued investment in the market leading platform. AMP’s SMSF business, SuperConcepts, also increased its assets under administration as it builds on its market-leading position.

“Wealth management cashflows have been strong since the beginning of Q2 as we near the 1 July 2017 effective date for superannuation contribution changes and from the transition of a large corporate super mandate to AMP. Final MySuper transitions were completed in April and net cashflows in wealth management are positive for the year to date.

“Q1 claims and lapse experience in Australian wealth protection indicate that the measures we’ve taken to stabilise the performance of the business are working.”

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