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AMP SMSF arm delivers revenue growth

AMP’s financial advice and SMSF arms have delivered on projected revenue growth even as its wealth management division took a hit due to MySuper.

In its full-year results for 2017 announced today, the financial services giant said its other revenue had grown by 10 per cent in 2017 as its advice and SMSF strategies delivered additional revenue growth.

Other revenue includes SuperConcepts revenue and product fees, platform fees, and advice fees received by licensees on Australian wealth protection products.

The results also showed AMP’s advice and SMSF businesses were on track to deliver additional revenue equivalent to 2 per cent of assets under management (AUM) fees in the 2018 financial year.

In the SMSF/SuperConcepts space, this would be through continued organic and inorganic growth of the SMSF administration business, incremental revenue growth from management of software accounts, and through the Connected Services online product marketplace launched in November last year, which the company said was delivering increasing annuity income stream growth over time.

SuperConcepts’ AUM stood at $23.2 billion at the fourth quarter of 2017, up from $22.47 billion on the previous quarter.

However, AMP’s wealth management division’s operating earnings dropped by 2.5 per cent to $391 million. It attributed this to final transitions to MySuper.
Wealth management AUM increased by 8 per cent during the 2017 financial year to $130 billion.

“Australian wealth management delivered a resilient performance during a period of high margin compression due to final transitions to MySuper,” AMP chief executive Craig Meller said.

“Operating earnings were 2.5 per cent lower at $391 million. However, strong growth in net cash flows and 10 per cent growth in other revenue from advice and SMSF demonstrates the underlying growth trajectory of the business.”

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