The advice & wealth management arm of the Ameriprise Financial has posted pre-tax operating earnings of $219m for the third quarter of 2015, an increase of 7% compared to $205m a year earlier.
For the quarter ended 30 September 2015, the division’s pretax operating margin reached a record high of 17.6% compared to 16.9% a year ago.
Operating net revenues at the unit were $1.24bn, a 3% increase compared to $1.21bn for the previous year period driven by growth in fee-based accounts from client net inflows partially offset by the negative impact of $20bn of lower asset levels from market declines during the quarter.
The division’s operating expenses rose 2% to $1bn. General and administrative expenses declined 1% compared to a year ago.
During the quarter, total retail client assets remained flat at $433bn compared to the prior year as client net inflows and client acquisition were offset by year-over-year market depreciation. Wrap net inflows stood at $3bn with wrap balances increasing 3% to $174bn.
The pre-tax operating earnings at the asset management unit for the third quarter of 2015 fell 13% to $180m from $208m a year ago driven by volatile market conditions globally, net outflows and the negative impact of foreign exchange.
The unit’s operating net revenues dropped 7% to $782m as asset levels were impacted by slowing market appreciation, as well as net outflows and the negative impact of foreign exchange.
Total segment assets under management decreased 7% to $471bn from $505bn a year ago. AuM dropped $34bn of which $10bn was due to an unfavorable foreign exchange impact, and net outflows.
Overall, the Ameriprise Financial group reported second quarter 2015 net income of $415m, or $2.23 per diluted share, up 11% compared to $374m a year ago.
Asset Management unit’s operating expenses fell 5% to $602m reflecting well-controlled general and administrative expenses and lower distribution expenses.
Overall, Ameriprise Financial group reported third quarter 2015 net income of $397m, or $2.17 per diluted share, down 5% compared to $420m a year ago.
Ameriprise chairman and CEO Jim Cracchiolo said: "In Advice and Wealth Management, we’re serving more clients and delivered another strong quarter for experienced advisor recruiting, both of which contributed to good client flows and helped balance market-related impacts in our other businesses.
"We continue to differentiate Ameriprise with our capital strength. Return on equity reached 24 percent at quarter end – one of the best in the industry. With the pull back in our valuation, we increased our share repurchases, and with dividends, returned more than $570 million to shareholders in the quarter."