AMP listing sharemarket catalyst

NZSE chairman Eion Edgar hopes the AMP listing will provide a fillup for direct share investing.

Tuesday, May 12th 1998, 12:00AM

Stock Exchange chairman Eion Edgar hopes the listing on AMP in June will be the catalyst that sparks renewed retail investment in shares.
Currently a only a very small proportion of the New Zealand sharemarket is owned by retail investors, while offshore countries like Australia and the United States have significant numbers of "mum and dad" investors.
Speaking at the launch of AMP’s annual review in Wellington on Monday night, Edgar said 270,000 New Zealand policyholders own AMP shares, giving it the largest shareholder base of any company in New Zealand.

The next biggest is Brierley Investments with a total of 110,000 shareholders.
Edgar hoped the listing would "increase the awareness of the sharemarket" as an investment option, and that it would "encourage them (policyholders) to make further direct investments" in shares.
One of the big questions is how many policyholders will hold onto their shares?
While past share giveaways in New Zealand, such as electricity companies, have had low retention rates there is a feeling a significant number of AMP policyholders will hold onto their shares.
One view being expressed is that 50 per cent shareholders will retain their shares.
Edgar described AMP’s demutualisation and listing as "one of the most important events in New Zealand’s corporate history".
AMP general manager Rodney Cook says the New Zealand business increased its profit from $162 million to $213 million in the year ending December 31.
That figure is based on the Australian margin on services formula, as there is no agreed method for calculating profits for life insurance business in New Zealand.
AMP’s consolidated investment income for 1997, including appreciation was $635 million, compared with $550 million the previous year.
Cook says the highlights of the results were AMP/Ergo passing the $1 billion mark in its mortgage writing business, and a 90 per cent increase in single premium sales.
He attributed the sound result to increased effort by the group’s adviser force and the strong performance from investment assets.

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