DOW JONES NEWSWIRES
Ameriprise Financial Inc.'s (AMP) second-quarter profit dropped
55%, as the provider of financial planning services posted lower
revenue and was weighed down by asset-based fees.
In May, six life insurers, including Ameriprise, received
preliminary approval for billions in federal aid under the Troubled
Asset Relief Program, but only two opted to participate. Ameriprise
was the first to reject the funds, saying it was confident it had
adequate funding.
Instead, last month Ameriprise announced plans to offer $900
million in common stock, to possibly fund future acquisitions. Two
areas the brokerage said it might look to augment are its
retail-distribution and asset-management capabilities.
On Thursday, Ameriprise reported a profit of $95 million, or 41
cents a share, down from $210 million, or 93 cents a share, a year
earlier.
Core operating earnings, which exclude losses from the
credit-market dislocation, fell to 58 cents a share from $1.03,
hurt by asset-based fees and the impact of maintaining high
liquidity levels.
Net revenue decreased 4.6% to $1.88 billion.
Analysts polled by Thomson Reuters expected earnings of 57 cents
a share on revenue of $1.77 billion.
"While the environment continued to impact our results, we're
beginning to see signs of improvement, with increased client
activity and solid asset flows across our platform," said Chairman
and Chief Executive Officer Jim Cracchiolo.
Ameriprise ended the quarter with more than $2 billion in excess
capital. The debt-to-capital ratio was 23.1%.
Shares were down 1% at $25.90 in after-hours trading. The stock
has more than doubled from its all-time low in November, but is
still off from its high of over $67 in 2007.
-By John Kell and Lauren Pollock, Dow Jones Newswires;
212-416-2480; john.kell@dowjones.com