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April 24, 2018updated 25 Apr 2018 4:43am

Ameriprise Financial wealth unit pre-tax adjusted operating earnings soar 27% in Q1

The advice & wealth management arm of Ameriprise Financial has posted pre-tax adjusted operating earnings of $316m for the first quarter of 2018, a surge of 27% compared to $248m in the previous year.

The company attributed the increase in pre-tax operating earnings to asset growth and higher earnings on cash balances.

The unit’s pretax adjusted operating margin increased to 21.1% in the first quarter from 18.8% in the year ago period.

The division’s net revenues increased 14% year-on-year to $1.5bn. Compared to the previous year, adjusted operating expenses dropped 10% to $1.2bn, mainly due to higher distribution expenses related to growth in client assets.

Total retail client assets increased 12% to $557bn from $499bn last year. The company said that the rise was due to client net inflows, client acquisition and market appreciation.

Wrap net inflows were $5.7bn, a 44% surge from $3.9bn a year earlier.

Asset Management

The pre-tax adjusted operating earnings in the asset management unit soared 30% to $195m from $150m last year.

The unit’s adjusted operating net revenue was $778m, up 7% from $725m in the previous year.

The division’s adjusted operating expenses rose 1% year-on-year to $583m, due to lower distribution-related expenses as well as well managed general and administrative expenses.

The unit’s AUM totalled $485bn at the end of March 2018, an increase of 4% from $467bn last year.

Ameriprise chairman and CEO Jim Cracchiolo said: “Ameriprise delivered a strong first quarter and a good start to the year. We are generating strong earnings across the firm, and our momentum in

Advice and Wealth Management continues with double-digit revenue growth, increased client activity and one of our strongest quarters of client net inflows.”

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