Ameriprise Logs Strong Fourth Quarter 2013 Results At Advice, Wealth Management Unit

Eliane Chavagnon

6 February 2014

Ameriprise Financial has reported that pre-tax operating earnings at its advice and wealth management unit shot up 36 per cent year-on-year in the fourth quarter of 2013 to $162 million compared to $119 a year ago, which the firm attributed to revenue growth and expense controls.

The fourth quarter 2013 pre-tax operating margin was 14.4 per cent, compared to 11.8 per cent a year ago and 14.2 per cent sequentially.

The firm added that the Q4 2013 pre-tax operating margin included a year-over-year negative impact of approximately 100 basis points from continued low interest rates.

The full-year pre-tax operating margin was 13.9 per cent, up from 11.4 per cent for 2012. Operating net revenues grew 12 per cent to $1.1 billion, which Ameriprise said was driven by asset growth in fee-based accounts from client inflows and improved client activity, as well as market appreciation.

Operating expenses increased 9 per cent to $965 million due to higher distribution expenses, while general and administrative expenses declined 1 percent.

Total retail client assets grew 16 per cent to $409 billion, boosted by client net inflows, client acquisition and market appreciation.

“The combination of asset growth and strong client activity drove a 14 per cent increase in operating net revenue per advisor, excluding results from former banking operations,” Ameriprise said.