AMP’s 2016 full-year loss was $344 million, a stark turnaround from 2015’s $972 million profit.
The main reason for the loss was a goodwill impairment of $668 million, which reflects a “decline in the potential recoverable amount for the Australian wealth protection business”.
The problems with AMP’s life insurance business were flagged in October 2016, along with a reinsurance deal with Munich Re to make the division less “capital intensive”.
AMP’s wealth protection division lost $415 million in 2016, compared with a $185 million profit in the previous year.
Wealth management posted a profit of $401 million, with smaller profits for AMP Capital ($144 million), AMP Bank ($120 million), New Zealand financial services ($126 million) and Australian mature ($151 million).
AMP also announced a $500 million share buyback that will see $500 million returned to shareholders to begin in the first quarter of 2017.
Commenting on the result, AMP chief executive Craig Meller pointed to action taken in late 2016 to “reset and stablise our business”.
“Our strategy is focused on directing capital to areas of our portfolio that will deliver the strongest growth, including Australian Wealth Management, AMP Capital and AMP Bank,” Mr Meller said.
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