10-KPeriod: FY2021

AMERIPRISE FINANCIAL INC Annual Report, Year Ended Dec 31, 2021

Filed February 25, 2022For Securities:AMP

Summary

Ameriprise Financial, Inc. (AMP) reported robust financial performance for the fiscal year ended December 31, 2021. The company experienced significant growth across its key segments, particularly in Advice & Wealth Management and Asset Management, driven by strong net inflows, market appreciation, and strategic acquisitions, including the notable purchase of BMO Global Asset Management (EMEA). Total assets under management and administration reached $1.4 trillion, a 29% increase year-over-year, reflecting successful growth initiatives and positive market conditions. Profitability saw a substantial increase, with net income rising 80% to $2.76 billion, translating to diluted earnings per share of $23.00. This performance was bolstered by a favorable $521 million impact from a block transfer reinsurance transaction and improved market-related assumptions. The company also demonstrated a strong commitment to shareholder returns through consistent dividend payments and a substantial share repurchase program. Looking ahead, Ameriprise is focused on its strategic shift towards lower capital, fee-based businesses and managing evolving regulatory landscapes.

Financial Highlights

36 data points
Beta

Revenue

$13.39B

Net Income

$3.42B

25.5% Net Margin

EPS (Diluted)

$28.48

Total Assets

$177.74B

Cash & Equivalents

$9.57B

Free Cash Flow

$3.33B

Financial Statements
Beta
Revenue$13.39B
Operating Expenses$9.19B
Net Income$3.42B
EPS (Basic)$29.13
EPS (Diluted)$28.48
Shares Outstanding (Basic)117.30M
Shares Outstanding (Diluted)120.00M

Key Highlights

  • 1Total Assets Under Management and Administration (AUM/AUA) grew by 29% to $1.4 trillion as of December 31, 2021.
  • 2Net income increased by 80% to $2.76 billion, with diluted EPS of $23.00.
  • 3Advice & Wealth Management segment adjusted operating earnings increased by 32% to $1.74 billion, driven by higher wrap account assets and net inflows.
  • 4Asset Management segment adjusted operating earnings surged by 57% to $1.10 billion, fueled by market appreciation, net inflows, and the acquisition of BMO Global Asset Management (EMEA).
  • 5Retirement & Protection Solutions segment adjusted operating earnings grew by 53% to $735 million, benefiting from shifts to lower-risk offerings and improved market assumptions.
  • 6The company repurchased $2.0 billion of common stock during 2021 and announced an additional $3.0 billion authorization.
  • 7Ameriprise Bank, FSB continued to grow, with $11.4 billion in cash sweep balances and $468 million in pledged asset lines of credit.

Frequently Asked Questions

Ameriprise Financial demonstrated strong financial performance in 2021, with net income increasing by 80% to $2.76 billion and diluted earnings per share reaching $23.00. This growth was driven by increases in assets under management and administration, favorable market conditions, successful strategic acquisitions, and improved operational performance across its key segments.

The acquisition of BMO Global Asset Management (EMEA) on November 8, 2021, was a significant strategic move that added $136 billion in assets under management and expanded Ameriprise's presence in EMEA. This acquisition contributed to a 38% increase in the Asset Management segment's total managed assets and a $59 million increase in revenue, bolstering the company's global capabilities and fee-based business growth.

Ameriprise is actively shifting its business mix towards lower capital and fee-based businesses with improved risk profiles. In line with this strategy, the company decided to discontinue new sales of substantially all variable annuities with living benefit guarantees at the end of 2021 and plans a full exit by mid-2022. This strategic pivot aims to reduce exposure to products with embedded guarantees and enhance overall profitability and capital efficiency.

Favorable market conditions in 2021, particularly higher average equity markets, positively impacted Ameriprise's results. The company's assets under management benefited from market appreciation, which in turn drove higher asset-based fees in its Advice & Wealth Management and Asset Management segments. However, the report also notes that volatility and changes in equity and interest markets, along with ongoing economic disruption from the COVID-19 pandemic, continue to present risks and uncertainties.