AMP increases focus on digital distribution
AMP Wealth Management is expected to generate less profit in the current financial year as it battles margin headwinds.
“Wealth management revenues in recent years have been impacted by margin compression following heightened market competition (particularly in KiwiSaver) and increasing regulatory focus on fees,” AMP said in an investor presentation last week.
The road to increased profits is limited as the business is already “operationally efficient business, with a high return on equity and low cost to income.”
“There is limited scope for further cost out with bottom line growth to be driven by improved investment performance and cash flows.”
It says it has continued to simplify it operations through automation and digital transformation" and has reduced its its customer services operations by 30%.
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