AMP provided an update on the demerger on Tuesday, saying a “clear perimeter” had been set with the agreed sale of the global equities and fixed income business and transfer of the multi-asset group to AMP Limited.
Preparation for the demerger accelerated earlier this month when AMP completed its exit from its former life insurance and mature business, AMP Life.
AMP chief executive Alexis George said the demerger will assist both businesses in increasing focus on their respective markets and provide more opportunities for growth.
“AMP has been rapidly transformed over the past three years. We are no longer a life insurer,” Ms George said.
“In wealth management, we have shifted from a vertically integrated proposition to a contemporary, customer-led service provider. We have invested in our bank to be able to grow in a deep and competitive market.
“We see a significant gap in the market in retirement and have strong capability within our business to better serve this market. We also believe we can further scale our business by taking our products direct to clients.
“Immediate priorities are to get the demerger done, meet our commitments on costs, drive forward on growth opportunities in bank and platforms, and set up AMP for a strong future.”
Last week, AMP announced that it is expecting additional impairment charges of $325 million in its financial year 2021 results following the demerger.
The charges are expected to come from partial impairment of deferred tax assets ($100 million post-tax), write-down of tangibles ($95 million post-tax), onerous lease contracts ($75 million post-tax) and other impairments and adjustments ($55 million post-tax).
“As we have developed our strategies for the post-demerger businesses of AMP and private markets, we have reviewed our balance sheet to ensure that assets recorded are in line with the future strategic direction,” Ms George said.
