10-KPeriod: FY2019

AMERIPRISE FINANCIAL INC Annual Report, Year Ended Dec 31, 2019

Filed February 26, 2020For Securities:AMP

Summary

Ameriprise Financial, Inc. reported solid financial performance for the year ended December 31, 2019. The company's diversified business model, primarily driven by its Advice & Wealth Management and Asset Management segments, contributed to a 1% increase in total net revenues to $13.0 billion. Net income saw a decrease of 10% to $1.9 billion, primarily impacted by a significant increase in the market impact on variable annuity guaranteed benefits. The company continued to execute its strategy of shifting towards lower capital, fee-based businesses, with Advice & Wealth Management now representing a majority of pretax adjusted operating earnings. Significant strategic moves during the year included the sale of its Auto & Home Insurance business and the conversion of its trust bank to a federal savings bank, Ameriprise Bank, FSB, signaling a focus on core growth areas and expanded banking capabilities. Ameriprise maintained a strong capital position, with total assets growing to $151.8 billion and shareholders' equity at $5.7 billion. The company returned value to shareholders through dividends and share repurchases, demonstrating a commitment to capital management. The report highlights the company's robust advisor network, with approximately 10,000 advisors, and a strong advisor retention rate, underscoring the value proposition offered to its financial professionals. Looking ahead, Ameriprise remains focused on capitalizing on demographic trends and market opportunities, while prudently managing risks associated with market fluctuations and regulatory changes.

Financial Statements
Beta
Revenue$13.10B
Operating Expenses$10.73B
Net Income$1.89B
EPS (Basic)$14.12
EPS (Diluted)$13.92
Shares Outstanding (Basic)134.10M
Shares Outstanding (Diluted)136.00M

Key Highlights

  • 1Total net revenues increased by 1% to $13.0 billion in 2019.
  • 2Net income decreased by 10% to $1.9 billion, influenced by market impacts on variable annuity guaranteed benefits.
  • 3Assets Under Management and Administration (AUM/AUA) grew by 18% to $973.4 billion, reflecting market appreciation and net inflows.
  • 4The Advice & Wealth Management segment showed strong growth with adjusted operating earnings up 9% to $1.5 billion, driven by wrap account growth and market appreciation.
  • 5The Asset Management segment's adjusted operating earnings decreased by 9% to $661 million due to net outflows, partially offset by higher average markets and increased performance fees.
  • 6The company returned $2.7 billion to shareholders through dividends and share repurchases in 2019.
  • 7Ameriprise completed the sale of its Auto & Home Insurance business and converted its trust bank to Ameriprise Bank, FSB, indicating strategic portfolio adjustments.

Frequently Asked Questions

Ameriprise Financial reported a net income of $1.9 billion for the year ended December 31, 2019.

The sale of the Auto & Home Insurance business, completed on October 1, 2019, resulted in net proceeds of $1.0 billion and a recognized gain on disposal of $213 million. This strategic divestiture aligns with the company's focus on its core growth areas of Advice & Wealth Management and Asset Management.

Ameriprise Financial's total Assets Under Management and Administration (AUM/AUA) increased by 18% to $973.4 billion as of December 31, 2019, compared to $822.7 billion as of December 31, 2018. This growth was driven by both market appreciation and net inflows across its segments.

The Advice & Wealth Management segment demonstrated strong performance, with adjusted operating earnings increasing by 9% to $1.5 billion for the year ended December 31, 2019. This growth was primarily attributed to net inflows in wrap accounts, market appreciation, and higher earnings on brokerage cash, partially offset by increased investments in business growth and higher advisor deferred compensation expenses.