Ameriprise Financial advice and wealth management arm has reported a 56% year-on-year jump in Q2 2021 earnings, benefitting from strong client net flows, higher transactional activity, and disciplined cost control.
The unit’s pre-tax adjusted operating earnings in the three-month-period ended 30 June 2021 was $423m, versus $271m a year earlier.
Its pretax adjusted operating margin increased 380 bps to 21.4% while adjusted operating net revenues of $1.98bn were 29% higher than the previous year.
Total client assets at the end of June 2021 were $807bn, driven by total client flows of $9.5bn in the quarter. This marks a 28% surge from $630bn of client assets reported in the prior year.
Wrap net flows stood at $10bn, marking the third consecutive quarter at or above $9bn of net flows. This is a 78% jump from the year-ago figure of $5.6bn.
Ameriprise Financial: Asset Management
The unit posted pre-tax adjusted operating earnings soared 79% year-on-year to $253m. The firm attributed the surge to strong market appreciation as well as the cumulative benefit of net inflows.
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Adjusted operating revenues grew 32% to $879m from $668m, driven by higher equity markets. Adjusted operating expenses increased 19%.
The unit’s assets under management rose 25% to $593bn, with net inflows of $6.7bn.
Equity, fixed income as well as asset-allocation strategies recorded strong investment performance.
Ameriprise chairman and CEO Jim Cracchiolo said: “Ameriprise delivered a strong second quarter and a record first half in operating revenue, earnings and EPS, as we continue to build on our momentum. We are delivering an excellent client experience and deepening relationships, which is driving continued growth in the business.
“In the quarter, nearly 80 percent of revenue and pretax earnings were driven by our asset-light Advice and Wealth Management and Asset Management businesses.”
Ameriprise was recently in the news for signing an agreement to buy the EMEA asset management business of BMO Financial in an all-cash deal worth around $845m (£615m).