AMP Advice Remediation Update

AMP has announced the provision for an additional $200 million that it will direct towards advice remediation issues.

This announcement was made late last week as part of an update ahead of the full release of AMP’s results for the 2018 Financial Year.

In noting it expects to report an underlying profit of approximately $680 million and profit attributable to shareholders of about $30 million, the wealth manager outlined a number of factors it says have impacted the second half 2018 profit attributable to shareholders, including:

  1. Costs arising from the Royal Commission response
  2. Portfolio review
  3. Increased investment in risk, governance and controls
  4. Advice remediation

AMP stated the additional $200 million in advice remediation comprises:

  • Program running costs of $186 million
  • Customer lost earnings of $14 million for the six months to December 2018
AMP “…continues to prioritise its advice remediation program to ensure all customers are appropriately compensated…

The release also noted AMP “…continues to prioritise its advice remediation program to ensure all customers are appropriately compensated and will provide updates in future reporting periods.”

AMP is set to announce its 2018 Financial Year results on 14 February 2019, which it says will reflect the split between the businesses it will retain and the business it has sold to Resolution Life (see: AMP to Sell Life Insurance Business).