Unlike the Commonwealth bank, the AMP showed considerable damage from its time being pulled apart by the Hayne Royal Commission.
The CBA only showed a small fall in profit – a large drop in its return on equity to a still very high 14.1% and a record dividend – and the share price continued its rally and is now up 11% or more since mid-June.
By comparison AMP’s first-half profit plunged 74% to $115 million after the company set aside $290 million to refund and compensate customers it overcharged for financial advice (which was announced last month).
Revenue for the six months to June 30 was down 6% to $7.17 billion.
AMP declared an interim dividend of 10 cents per security, franked at 50%, down from 14.5 cents for the first half of 2017.
AMP shares rose 3.8% to $3.48.
AMP’s result is the first since damaging revelations at the banking royal commission in April that the group charged customers for advice and misled the regulator.
The revelations claimed the jobs of former CEO Craig Meller and chairman Catherine Brenner along with several other directors. AMP’s underlying profit – excluding the compensation provisions – was $495 million, down a touch from $533 million in the first half of 2017.
AMP acting CEO Mike Wilkins said yesterday in a statement the results “demonstrated AMP’s resilience through a difficult period”.
"While there will be further challenges ahead, we have a strong foundation on which to reset the business and restore the confidence of our customers and the wider community," he said.
"The events around the royal commission into financial services have challenged our reputation, and while we continue to monitor the impacts, we have taken action to stabilise the business and move forward."
AMP’s wealth management division increased lifted earnings by nearly 6% in the half year from advice and self-managed superannuation services, despite lower fee margins and more customers switching to low-fee super products.
The company’s capital and banking divisions saw earnings rise 2.2% and 20.0% respectively, while the contribution from its financial services business in New Zealand was down just on 14% in the half.
Profit in insurance, or wealth protection, fell 98% to just $1 million, which Mr Wilkins blamed on higher-than-expected claims for total and permanent disability insurance, as well as the cost of additional re-insurance, the insurance insurers buy to protect themselves. Meanwhile AMP also revealed that it had recruited former head of Federal Treasury John Fraser as a new company director. It will be Fraser’s first board gig since announcing he was leaving the Federal Treasury six weeks ago.