14 Feb 2019

Kiwisavers cash out of AMP as profit slashed by 97%

3:45 pm on 14 February 2019

Australian-owned insurance company AMP is selling less financial advice to New Zealanders, but wants that to change, according to its full year financial result.

AMP is an Australian financial services company. This is its office in Melbourne.

AMP underlying profit fell from Photo: 123rf

Underlying profit for the company's local arm fell 1.9 percent from $A54 million ($NZ56m) to $A53m ($NZ55m).

Cash flow in the New Zealand division fell by 62.3 percent.

That was primarily driven by Kiwisavers either cashing out for retirement or to buy a home, or switching providers, to the tune of $A527m.

However, in an investor report, AMP said KiwiSaver and retirement planning advice was a key focus to boost its growth.

The entire company's net profit for the financial year fell a dramatic 96.7 percent from $A848m in 2017 to $A28 million in 2018, after incuring costs and issuing refunds to customers, associated with the Australian Royal Commission into banking misconduct.

AMP's chairman and chief executive resigned last year at the height of the fees for no service scandal, where AMP was caught charging customers for services they never received, and then lying about it to regulators.