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Significant changes to AMP Financial Services

AMP announces significant changes to AMP Financial Services New Zealand business

As a result of the completion of the portfolio review of its managed for value businesses, including Australian wealth protection, mature and New Zealand, AMP today announced its:

Sale of AMP Australian and New Zealand wealth protection and mature businesses to Resolution Life Group Holdings (Resolution Life); transaction subject to regulatory approvals and expected to complete in the second half of 2019; terms and conditions of existing life insurance policies will be retained.
Intention to seek divestment of AMP New Zealand wealth management and advice businesses via an IPO in 2019, subject to market conditions and regulatory approvals, unlocking further value.
Binding agreement with Swiss Re to reinsure New Zealand retail wealth protection, releasing additional capital of up to A$150 million to AMP prior to completion of sale; subject to regulatory approvals.

Blair Vernon, AMP New Zealand’s Managing Director says:

“AMP New Zealand is a highly efficient, well-run business which has been a consistent contributor to AMP. A strong team with a history of consistent delivery for all stakeholders has prepared AMP New Zealand for this significant change.

“Importantly, policyholders will retain all terms and conditions of existing policies, so there’s nothing they need to do. There are no changes for AMP New Zealand’s wealth management or general insurance clients, including members of the AMP KiwiSaver Scheme.

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“We are communicating with all customers in relation to today’s announcement. More information is also available on our website at amp.co.nz/changes.”

Intention to seek divestment of AMP New Zealand wealth management and advice businesses via an IPO*


Intention to seek divestment of AMP New Zealand wealth management and advice businesses (including distribution partnerships) via an IPO in 2019.
The decision to proceed with an IPO and its timing remains subject to market conditions and regulatory approvals.
The standalone business has FY18 pro forma operating earnings of approximately A$40 million.
The proposed IPO does not include AMP Capital Investors, which operates independently in New Zealand.

Sale of AMP Australian and New Zealand wealth protection and mature businesses


AMP New Zealand and Australian life insurance business being acquired by Resolution Life.
Resolution Life is an international insurance and reinsurance group whose management has a 15-year track record in providing quality service to in-force insurance customers.

AMP New Zealand wealth protection reinsurance


AMP has entered into a binding agreement with Swiss Re for the New Zealand retail wealth protection portfolio which is expected to release up to A$150 million of capital to AMP, subject to regulatory approval. The agreement is expected to be effective from 31 December 2018 and will cover approximately 65 per cent of the New Zealand retail wealth protection portfolio for new claims incurred from that date.
The reinsurance agreement is expected to reduce New Zealand profit margins by A$20 million on a full-year basis. The reinsurance outcomes are factored into the Resolution Life transaction.

-ENDS

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