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AMP's New Zealand financial services business has notched up a 20 per cent increase in profit and spoken of both challenges and opportunities from government changes to the industry.
Operating earnings rose 20 per cent to $32.1 million in the six months to June 30 from the same period last year. In Australian dollar terms the profit was up 13 per cent.
The increase was put down to cost control, better claims management and improved margins in the life insurance business. Life insurance premium income increased 12.5 per cent.
AMP experienced a 294 per cent increase in cashflow at a time when the industry was experiencing negative cashflows.
It attributed the strong cashflow to good market shares, especially in workplaces. AMP's 85,000 KiwiSaver members represent 12 per cent of the KiwiSaver market by number and 15 per cent of the total market by funds under management.
"AMP Financial Services New Zealand is being affected by an unprecedented wave of regulatory, tax and saving changes as well as dynamic market and competitor activity," the company said.
It said its priority was to build the quality, productivity and number of its advisers.
The company also has business transformation programme under way that aims to grow the business by driving cost efficiencies and improving service delivery, in order to take account of opportunities arising from unprecedented change in the industry, AMP Financial Services managing director Jack Regan said.
AMP said its KiwiSaver and New Zealand Retirement Trust (NZRT) schemes were proving to be a "compelling value proposition" in the workplace.
Regan said operating costs had been carefully managed during a period of change in the business.
AMP's adviser numbers remain steady at around 400, including 32 Roost mortgage and insurance advisers.
In the Australian dollar accounts for AFS New Zealand presented by the parent the profit margin was down 15 per cent, controllable costs were up 14 per cent, and lapse rates were up 0.8 percentage points.
The return on equity fell 2.5 percentage points from the same period last year.
- NZPA
