Summary
Ameriprise Financial, Inc. reported its financial results for the third quarter and the first nine months of 2012. For the third quarter, net income attributable to Ameriprise Financial was $173 million, or $0.79 per diluted share, a decrease from $324 million, or $1.34 per diluted share, in the same period of 2011. The nine-month period saw net income attributable to Ameriprise Financial of $640 million, or $2.84 per diluted share, down from $880 million, or $3.52 per diluted share, in the prior year. This decline was primarily attributed to unfavorable impacts from "unlocking" (changes in actuarial assumptions), the market impact on variable annuity guarantees, net realized losses on securities linked to the Ameriprise Bank transition, and the persistent low interest rate environment. Despite these challenges, the company saw growth in its Advice & Wealth Management segment, with increased net revenues driven by higher asset-based fees from growth in wrap account assets, and an increase in operating earnings.
Financial Highlights
32 data points| Revenue | $2.48B |
| Operating Expenses | $2.27B |
| Operating Income | $643.00M |
| Net Income | $173.00M |
| EPS (Basic) | $0.80 |
| EPS (Diluted) | $0.79 |
| Shares Outstanding (Basic) | 215.00M |
| Shares Outstanding (Diluted) | 219.10M |
Key Highlights
- 1Net income attributable to Ameriprise Financial decreased significantly in both the third quarter and the first nine months of 2012 compared to 2011.
- 2The decrease in net income was primarily driven by "unlocking" impacts, market fluctuations affecting variable annuity guarantees, net realized losses on securities, and the prolonged low interest rate environment.
- 3The Advice & Wealth Management segment showed resilience, with increased net revenues and operating earnings driven by higher asset-based fees and growth in wrap account assets.
- 4The Asset Management segment experienced a 30% increase in operating earnings for the third quarter, driven by market appreciation, performance fees, and expense management, despite net outflows.
- 5The Annuities segment saw a significant decline in operating earnings due to lower net investment income and unfavorable "unlocking" impacts.
- 6The company announced its intention to transition its federal savings bank subsidiary, Ameriprise Bank, FSB, to a limited powers national trust bank, which is expected to release capital for share repurchases.
- 7Ameriprise Financial continued its share repurchase program, with an additional $2.0 billion authorized for repurchases through 2014.