AMP looks to ‘more episodic advice’ to retake market share

When questioned about how AMP could provide quality advice “at a price consumers will pay” while also generating profits, Francesco De Ferrari acknowledged that the increasing complexity of regulation made that proposition difficult but that the company was working “very actively” on what he called “more episodic advice”.

“So not having a financial adviser throughout your whole investment life cycle, but only at specific points in your life journey, where effectively having good advice is absolutely pivotal to ensuring retirement outcomes. For example, when you decide to buy your first home, when you get married,” Mr De Ferrari said.

“There’s full scale advice, there’s episodic advice, and then there’s the part we still have some work to do with the government and regulators which is the provision of phone-based and digitally enabled advice and that’s the area that will effectively allow us to make advice not just affordable for all Australians, but also an investible proposition for shareholders.”

Mr De Ferrari said that “well run” advice practices were very profitable businesses, but that the licensing activity was “more challenging from a shareholder point of view”. AMP also shared more detail on its proposed demerger with AMP Capital, with Mr De Ferrari warning that the company had not yet committed to maintain a 20 per cent shareholding in the new private markets entity.

“Our current hypothesis from a board perspective is that we would retain 20 per cent to show support for the business demerged but there’s a lot of water to go under the bridge until the final determination and a final proposal will be put to shareholders for the demerger,” Mr De Ferrari said.

AMP narrowly avoided a second strike against its remuneration report at the AGM, with 76.82 per cent in favour and 23.18 per cent against.

Correction: This article originally used the phrase 'exotic' advice. Mr De Ferrari said 'episodic' advice.