Embattled AMP slumps 3pc on more fund outflows

AMP shares have tumbled more than 3 per cent after it posted net outflows of $1.5bn in the March quarter.

AMP CEO Francesco De Ferrari says the wealth manager’s business performance has been resilient. Picture: Britta Campion

AMP shares have tumbled more than 3 per cent after the under-pressure wealth manager revealed it suffered more outflows in the March quarter.

Over the three-month period, its wealth management assets under management increased by $1.6bn to $125.7bn on the back of rising investment markets.

But net outflows hit $1.5bn, down only slightly on the $1.7bn in outflows it suffered over the same period last year.

AMP Capital, meanwhile, bled $2.9bn in net outflows, dragging its assets under management down to $186.5bn.

AMP shares tumbled 3.4 per cent to end at $1.12, its lowest point since the stockmarket meltdown a year ago.

Despite billions flowing out of the wealth manager, outgoing CEO Francesco De Ferrari attempted to paint a positive picture on its outlook, saying cashflows were showing underlying signs of improvement.

“Business performance remained resilient during the first quarter as we continued to make progress on delivery of our transformation strategy to become a simpler, client-led business,” he said in the quarterly update.

“The increase to our assets under management in our wealth management business reflects continued improvement in investment markets in the first quarter.”

Of the $1.5bn in net outflows in its wealth management division, a third was due to pension payments.

“We are accelerating change within AMP, having made strong progress on addressing our legacy issues, including our client remediation program, which is close to 90 per cent complete,” Mr De Ferrari said.

“We remain focused on delivering critical priorities to progress our transformation over the next quarter and continue positioning the business for future growth.”

But no mention was made of the protracted takeover talks with Ares Management, which will likely frustrate shareholders anxious for some movement in the stop-start discussions.

As revealed by The Australian this month, the US suitor is understood to be forging ahead with a cash offer for all of AMP’s $59bn private markets unit, despite the under-pressure wealth group’s preference for a joint venture.

The Ares deal team is believed to be interested in the division in its entirety and may lob an offer ahead of AMP’s annual general meeting on April 30.

Ares abandoned a $6bn-plus whole-of-company bid for AMP in February before proposing to acquire 60 per cent of the division in a joint venture that would see it take management control while AMP holds on to the remaining 40 per cent.

An AMP spokesman declined to comment on the progress of the discussions.

Over the quarter, external net outflows at AMP Capital were driven by fixed income outflows as well as planned divestment of assets in infrastructure equity closed-end funds, the wealth manager said.