AMP profit slashed 96 per cent

By Business News Australia

25 January 2019

Things continue to get worse for AMP (ASX: AMP) in the ongoing wake of the banking royal commission.

The company has announced that its full year profit will fall by 96 per cent after confirming it will set aside another $200 million to cover the cost of customer remediation issues arising from the royal commission.

The financial management business says it expects net profit attributable to shareholders for the 12 months to December 31, 2018 of about $30 million. That is a significant dive from its profit of $848 million at the end of 2017.

The company expects to report an underlying profit of around $680 million.

As such, the company will slash its final dividend from 14.5 cents to 4 cents.

Shareholders were already quite upset at AMP last year, delivering a first strike on remuneration at a shareholder meeting. This latest hit probably won't score the AMP board any new fans.

The company now faces the prospect of a board spill at May's annual general meeting.

AMP, which lost its chief executive and chairman following the disastrous royal commission for issues including lying to regulators and charging dead clients for advice, reports its full-year results on February 14.

Shares in AMP are down 7.48 per cent to $2.35 per share at 10.40am AEDT.