AMERIPRISE FINANCIAL INC Quarterly Report for Q1 Ended Mar 31, 2016

Summary

Ameriprise Financial, Inc. (AMP) reported net income attributable to Ameriprise Financial of $364 million for the first quarter of 2016, a decrease from $393 million in the same period of 2015. This decline was primarily driven by lower net investment income and a decrease in management and financial advice fees. The company's total revenues also saw a decline, primarily due to lower asset-based fees reflecting a decrease in average assets under management, impacted by market depreciation and net outflows. Despite the revenue pressures, the company managed its expenses effectively, leading to a decrease in total expenses. The Advice & Wealth Management segment remained a significant contributor to operating earnings. The company also continued its share repurchase program, demonstrating a commitment to returning capital to shareholders. However, investors should note the ongoing impact of the low interest rate environment on net investment income and potential spread compression.

Key Highlights

• 1Net income attributable to Ameriprise Financial decreased by 7% to $364 million in Q1 2016 compared to $393 million in Q1 2015.
• 2Total net revenues decreased by 9% to $2.765 billion in Q1 2016 compared to $3.053 billion in Q1 2015.
• 3Management and financial advice fees, a key revenue stream, decreased by 6% to $1.386 billion.
• 4Net investment income saw a significant decrease of 32% to $331 million, impacted by lower earnings from consolidated investment entities and hedging impacts.
• 5Total expenses decreased by 6% to $2.290 billion, driven by lower distribution expenses and interest credited to fixed accounts.
• 6The company repurchased 5.1 million shares of common stock for $451 million during the quarter, reflecting ongoing capital return initiatives.
• 7Total Assets Under Management and Administration (AUM/AUA) decreased by 5% to $772.7 billion.

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