What was the primary driver of revenue growth in the third quarter of 2006?

Revenue growth was primarily driven by increases in management, financial advice, and service fees, which rose by 5% to $720 million. This was largely due to strong performance in the Asset Accumulation and Income (AA&I) segment, benefiting from growth in wrap assets and annuity variable account assets.

How did the launch of Ameriprise Bank impact the company's financial position?

The launch of Ameriprise Bank in September 2006 marked a strategic expansion. In the third quarter, it acquired $963 million in customer deposits and $12 million in customer loans from American Express Bank, FSB, receiving $951 million in cash. This initiative is expected to enhance the company's banking service offerings to clients.

What is the company's outlook regarding share repurchases?

Ameriprise Financial has an active share repurchase program. As of September 30, 2006, the company had repurchased 9.7 million shares for $422 million in the first nine months of the year and had $414 million remaining under its March 2006 authorization, indicating a continued commitment to returning capital to shareholders.

How did the separation from American Express continue to affect financial results?

While the separation was substantially completed in late 2005, the company continued to incur non-recurring separation costs, totaling $87 million in the third quarter of 2006. These costs are related to rebranding, technology infrastructure, and other separation activities. The company expects to incur approximately $875 million in total pretax separation costs.

AMP 10-Q Quarterly Report Q3 FY2006 — Revenue, Net Income, EPS

Summary

Ameriprise Financial, Inc. reported solid top-line growth in the third quarter of 2006, with total revenues increasing by 6% to $1.98 billion compared to the prior year period. This growth was driven primarily by increases in management, financial advice, and service fees, reflecting strong performance in the Asset Accumulation and Income (AA&I) segment, particularly in wrap accounts and variable annuities. The company also saw a significant rebound in net investment income due to a reduction in realized investment losses. While net income saw a substantial increase of 39% to $174 million, this was compared against a lower base in the prior year, which included discontinued operations. Excluding these items, the underlying operational performance remained robust, with income before discontinued operations up 41%. The company also highlighted progress in key strategic initiatives, including the launch of Ameriprise Bank and continued execution on its share repurchase program, demonstrating a commitment to enhancing shareholder value.

Key Highlights

1Total revenues increased by 6% to $1.98 billion for the third quarter of 2006, driven by higher management, financial advice, and service fees.
2Net income significantly increased by 39% to $174 million for the third quarter, reflecting improved operational performance and a comparison against a weaker prior year period.
3The Asset Accumulation and Income (AA&I) segment showed strong revenue growth, benefiting from increased wrap account balances and annuity variable account assets.
4Ameriprise Financial launched Ameriprise Bank, FSB in September 2006, acquiring significant customer deposits and loans, marking a strategic expansion of its banking services.
5The company continued its share repurchase program, buying back 9.7 million shares for $422 million during the first nine months of 2006, signaling confidence and a commitment to returning capital to shareholders.
6Owned, managed, and administered assets grew by 5% to $440 billion year-over-year, indicating continued client asset growth despite some asset outflows in fixed products.
7The company's effective tax rate improved to 19.8% for the quarter, aided by tax benefits related to prior year returns.

AMERIPRISE FINANCIAL INC Quarterly Report for Q3 Ended Sep 30, 2006

Summary

Key Highlights

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