Company Announcements

Ameriprise Financial Reports Second Quarter 2021 Results

MINNEAPOLIS--(BUSINESS WIRE)--Jul. 26, 2021-- Ameriprise Financial, Inc. (NYSE: AMP):

 

Earnings Per Diluted Share

 

Return on Equity, ex AOCI (1)

 

Q2 2021

Q2 2021

GAAP

$4.88

 

GAAP

19.5%

Adjusted Operating

$5.27

 

Adjusted Operating

37.5%

 
  • Second quarter adjusted operating earnings per diluted share was $5.27. Adjusted operating EPS increased 39 percent from the prior year excluding a negative prior year period tax impact of $1.14 per diluted share, reflecting strong business growth.

 

Perspective from Jim Cracchiolo, Chairman and Chief Executive Officer

 

 

“Ameriprise delivered a strong second quarter and a record first half in operating revenue, earnings and EPS, as we continue to build on our momentum. We are delivering an excellent client experience and deepening relationships, which is driving continued growth in the business.

 

“In the quarter, nearly 80 percent of revenue and pretax earnings were driven by our asset-light Advice and Wealth Management and Asset Management businesses.

 

“We also announced a number of important strategic actions, including the acquisition of BMO’s EMEA asset management business and a significant reinsurance transaction. Together, these moves complement our organic growth while also adding key capabilities and generating shareholder value.”

  • Second quarter GAAP net income per diluted share was $4.88, which was impacted by market changes that affected the valuation of derivatives. In the prior year period, results were impacted by changes in the company’s credit spread and the valuation of derivatives used to hedge the company’s variable annuity living benefit guarantees.

 

  • Adjusted operating net revenue was $3.4 billion, a 22 percent increase from strong organic growth.

 

  • General and administrative expenses were well managed in light of business growth, up 6 percent.

 

  • Assets under management and administration were up 28 percent to $1.2 trillion, a record high from strong client flows in Wealth and Asset Management, as well as market appreciation.

 

  • The company continues to generate strong organic growth, with over $16 billion of client net inflows from Advice & Wealth Management and Asset Management.

 

  • Investment performance at Columbia Threadneedle Investments remains excellent with 110 funds with 4- and 5-star Morningstar ratings.

 

  • The company returned $585 million of capital to shareholders in the quarter, which was 92 percent of adjusted operating earnings.

 

  • During the quarter, the company made substantial progress in expanding its growth businesses and reducing its risk profile.

 

  • On June 29, 2021, Ameriprise announced that its insurance subsidiaries entered into an agreement to reinsure approximately $8.0 billion of fixed annuities, which will free up approximately $700 million of capital. In July, the RiverSource Life Insurance Company transaction closed.

 

 

  • Ameriprise is on track to close its acquisition of BMO’s EMEA Asset Management business in the fourth quarter of 2021. The acquisition expands key capabilities in attractive and growing market segments where BMO EMEA Asset Management has leading positions.

 

 

(1) Return on equity excluding AOCI is calculated on a trailing 12-month basis.

As indicated, the severe market dislocation and steep interest rate reduction in the first quarter of 2020 related to COVID-19 distorted the company’s prior year GAAP and operating results. This included a tax benefit from a projected net operating loss (NOL) in the first quarter of 2020 that was reversed in the second quarter of 2020.

 

Ameriprise Financial, Inc.

Second Quarter Summary

 

Quarter Ended
June 30,

% Over/
(Under)

 

Year-to-date
June 30,

% Over/
(Under)

(in millions, except per share amounts, unaudited)

2021

2020

 

2021

2020

GAAP net income

$

591

 

 

$

(539)

 

 

NM

 

$

1,028

 

$

1,497

 

(31)%

Adjusted operating earnings (see reconciliation on p. 25 and p. 26)

$

639

 

 

$

333

 

 

92%

 

$

1,302

 

$

1,027

 

27%

Adjusted operating earnings excluding Net Operating Loss (NOL) tax impacts (see reconciliation on p. 25 and p. 26)

$

639

 

 

$

477

 

 

34%

 

$

1,302

 

$

1,027

 

27%

 

 

 

 

 

 

 

 

 

 

GAAP net income per diluted share

$

4.88

 

 

$

(4.31)

 

 

NM

 

$

8.45

 

$

11.77

 

(28)%

Adjusted operating earnings per diluted share (see reconciliation on p. 25 and p. 26)

$

5.27

 

 

$

2.64

 

 

100%

 

$

10.70

 

$

8.07

 

33%

Adjusted operating earnings per diluted share excluding Net Operating Loss (NOL) tax impacts (see reconciliation on p. 25 and p. 26)

$

5.27

 

 

$

3.78

 

 

39%

 

$

10.70

 

$

8.07

 

33%

 

 

 

 

 

 

 

 

 

 

GAAP Return on Equity, ex. AOCI

19.5

 

%

41.7

 

%

 

 

 

 

 

Adjusted Operating Return on Equity, ex. AOCI

37.5

 

%

35.6

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

118.4

 

125.0

 

 

 

 

 

 

Diluted

121.2

 

126.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NM Not Meaningful - variance equal to or greater than 100%

 

 

 

 

 

Ameriprise Financial, Inc.

Advice & Wealth Management Segment Adjusted Operating Results

 

Quarter Ended
June 30,

% Over/
(Under)

(in millions, unaudited)

2021

2020

Net revenues

$

1,980

 

 

$

1,537

 

 

29%

Distribution expenses

1,194

 

 

913

 

 

(31)%

G&A / other expense

363

 

 

353

 

 

(3)%

Pretax adjusted operating earnings

$

423

 

 

$

271

 

 

56%

 

 

 

 

 

 

Pretax adjusted operating margin

21.4

 

%

17.6

 

%

380 bps

 

 

 

 

 

 

 

 

 

Quarter Ended
June 30,

% Over/
(Under)

(in billions, unless otherwise noted)

2021

 

2020

Total client assets

$

807

 

 

$

630

 

28%

Total client net flows (1)

$

9.5

 

 

$

6.2

 

54%

Wrap net flows (1)

$

10.0

 

 

$

5.6

 

78%

AWM cash balance

$

39.2

 

 

$

38.6

 

2%

Average gross yield on cash balances (in bps)

63

 

 

79

 

 

Adjusted operating net revenue per advisor (TTM in thousands)

$

731

 

 

$

669

 

9%

Adjusted for interest rates (2)

$

731

 

 

$

641

 

14%

 

 

 

 

 

(1) See definition on page 12.

(2) Adjusted for impact from interest rates. See reconciliation on page 28.

Advice & Wealth Management pretax adjusted operating earnings were $423 million, up 56 percent driven by continued robust client net flows, higher transactional activity, market appreciation and disciplined expense management. Pretax adjusted operating margin increased 380 basis points. On a sequential basis, pretax operating earnings increased 9 percent and pretax adjusted operating margin expanded 70 basis points.

Adjusted operating net revenues grew 29 percent to $2.0 billion, reflecting strong client net flows and market appreciation. On a sequential basis, revenues increased 5 percent.

Total expenses were $1.6 billion, reflecting higher distribution expense related to strong organic growth. General and administrative expense was well managed and increased 3 percent, reflecting the cost associated with increased activity and performance-based compensation expense.

Total client assets grew 28 percent to $807 billion, with continued robust total client flows of $9.5 billion in the quarter. The company’s ability to meet client needs efficiently and effectively is translating into excellent organic growth. Advisor productivity remains high with a 78 percent increase in flows in the investment advisory business and a 29 percent increase in transactional activity. Wrap net flows were $10.0 billion, representing the third consecutive quarter at or above $9.0 billion of net flows. Cash balances remain elevated at $39.2 billion with an opportunity for clients to put cash back to work in the future.

Adjusted operating net revenue per advisor on a trailing 12-month basis was $731,000. Excluding the decline in short-term interest rates, adjusted net revenue per advisor increased 14 percent. Total advisors were 10,047, up 2 percent, from a combination of high advisor retention and the addition of 42 experienced advisors in the quarter.

 

Ameriprise Financial, Inc.

Asset Management Segment Adjusted Operating Results

 

Quarter Ended
June 30,

% Over/
(Under)

(in millions, unaudited)

2021

2020

Net revenues

$

879

 

 

$

668

 

 

32%

Distribution expenses

282

 

 

220

 

 

(28)%

G&A / other expenses

344

 

 

307

 

 

(12)%

Pretax adjusted operating earnings

$

253

 

 

$

141

 

 

79%

 

 

 

 

 

 

Net pretax adjusted operating margin (1)

45.4

 

%

34.5

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended
June 30,

% Over/
(Under)

(in billions)

2021

2020

Total segment AUM

$

593

 

 

$

476

 

 

25%

 

 

 

 

 

 

Net Flows

 

 

 

 

 

Global Retail net flows

$

4.2

 

 

$

3.1

 

 

38%

Global Institutional net flows, ex. legacy insurance partners flows

3.9

 

 

0.8

 

 

NM

Legacy insurance partners flows

(1.4)

 

 

(1.3)

 

 

(7)%

Total segment net flows

$

6.7

 

 

$

2.6

 

 

NM

 

 

 

 

 

 

Model delivery AUA Flows (2)

$

0.9

 

 

$

0.3

 

 

NM

 

 

 

 

 

 

(1) See reconciliation on page 13.

 

 

 

 

 

(2) Estimated based on the period to period change in assets less calculated performance based on strategy returns on a one-quarter lag.

NM Not Meaningful - variance equal to or greater than 100%

Asset Management pretax adjusted operating earnings were $253 million, up 79 percent, reflecting strong market appreciation and the cumulative benefit of net inflows. The net pretax adjusted operating margin was 45.4 percent. On a sequential basis, pretax operating earnings increased 11 percent and pretax adjusted operating margin expanded 150 basis points.

Adjusted operating revenues increased 32 percent to $879 million from the cumulative benefit of inflows and higher equity markets. The overall fee rate remained strong at 52 basis points. On a sequential basis, revenues increased 6 percent.

Adjusted operating expenses increased 19 percent. General and administrative expenses grew 12 percent driven primarily from strong business performance that drove higher compensation expense and foreign exchange translation, as well as the costs associated with increased activity levels.

Total assets under management increased 25 percent to $593 billion reflecting equity market appreciation and net inflows. Investment performance remained strong across equity, fixed income and asset-allocation strategies.

In the quarter, net inflows were $6.7 billion, an improvement of $4.1 billion from a year ago. Net inflows were $8.1 billion excluding legacy insurance partners outflows, reflecting a continuation of positive flow trends across multiple distribution channels and strategies:

  • Retail net inflows were $4.2 billion. Net inflows in North America were $5.1 billion with notable inflows in the broker-dealer channel, which were partially offset by outflows in EMEA.
  • Global institutional net inflows were $3.9 billion, with gross sales across multiple strategies.

     

 

Ameriprise Financial, Inc.

Retirement & Protection Solutions Segment (1) Adjusted Operating Results

 

Quarter Ended
June 30,

% Over/
(Under)

(in millions, unaudited)

2021

 

2020

Net revenues

$

808

 

 

$

755

 

7%

Expenses

626

 

 

533

 

(17)%

Pretax adjusted operating earnings

$

182

 

 

$

222

 

(18)%

 

 

 

 

 

 

Retirement & Protection Solutions pretax adjusted operating earnings were $182 million. Results in the prior year period benefited from lower surrenders and withdrawals that reduced the amortization of deferred acquisition costs. Results in the current quarter reflect higher distribution expenses associated with improved sales trends, compared to a year ago when sales were depressed from the environment. Overall claims remain within expected ranges.

Retirement sales increased 88 percent year-over-year to $1.6 billion. Retirement sales reflect the ongoing shift to lower risk products. Variable annuity sales without living benefit guarantees represented 66 percent of variable annuity sales in the quarter. This shift is improving the risk profile of our inforce block, with account values with living benefit riders down over 2 percentage points year-over-year to 62 percent. Annuity net amount at risk as a percent of account values was de minimis at 0.3 percent for living benefits and 0.1 percent for death benefits.

Sales of protection products nearly doubled from a year ago with a product mix shift that is consistent with our focused approach. Sales of higher-margin accumulation VUL products increased substantially while sales shifted away from indexed UL products as expected given pricing changes that reflect the low interest rate environment.

(1) Retirement & Protection Solutions segment includes Retirement Solutions (Variable Annuities and Payout Annuities) and Protection Solutions (Life and Disability Insurance). Fixed Annuities moved to the Corporate & Other segment in Q3 2020 as a closed block. Prior periods have been restated.

 

Ameriprise Financial, Inc.

Corporate & Other Segment (1) Adjusted Operating Results

 

Quarter Ended
June 30,

% Over/
(Under)

(in millions, unaudited)

2021

 

2020

Corporate & Other, excluding Closed Blocks

$

(74)

 

 

$

(77)

 

4%

Closed Blocks (2)

(3)

 

 

20

 

NM

Pretax adjusted operating earnings

$

(77)

 

 

$

(57)

 

(35)%

 

 

 

 

 

Long Term Care

$

3

 

 

$

17

 

(82)%

Fixed Annuities

(6)

 

 

3

 

NM

Closed Blocks pretax adjusted operating earnings

$

(3)

 

 

$

20

 

NM

 

 

 

 

 

(1) Fixed Annuities was moved into the Corporate & Other segment as a closed block. Prior periods have been restated.

(2) Long Term Care and Fixed Annuities.

NM Not Meaningful - variance equal to or greater than 100%

Total Corporate & Other pretax adjusted operating loss was $77 million.

Corporate & Other, excluding Closed Blocks, pretax adjusted operating loss was $74 million. Results in the quarter included $7 million of affordable housing impairments.

Long Term Care pretax adjusted operating earnings were $3 million, down from last year as mortality and terminations activity returned to pre-COVID levels in the quarter.

Fixed Annuities pretax adjusted operating loss was $6 million from narrowed spreads from low interest rates.

Taxes

The operating effective tax rate was 18.2 percent for the second quarter. The full year operating effective tax rate is expected to be approximately 17 percent.

About Ameriprise Financial

At Ameriprise Financial, we have been helping people feel confident about their financial future for more than 125 years. With extensive advisory, asset management and insurance capabilities and a nationwide network of over 10,000 financial advisors, we have the strength and expertise to serve the full range of individual and institutional investors' financial needs. For more information, or to find an Ameriprise financial advisor, visit ameriprise.com.

Ameriprise Financial Services, LLC offers financial planning services, investments, insurance and annuity products. Columbia Funds are distributed by Columbia Management Investment Distributors, Inc., member FINRA and managed by Columbia Management Investment Advisers, LLC. Threadneedle International Limited is an SEC- and FCA-registered investment adviser affiliate of Columbia Management Investment Advisers, LLC based in the U.K. RiverSource insurance and annuity products are issued by RiverSource Life Insurance Company, and in New York only by RiverSource Life Insurance Co. of New York, Albany, New York. Only RiverSource Life Insurance Co. of New York is authorized to sell insurance and annuity products in the state of New York. These companies are all part of Ameriprise Financial, Inc. CA License #0684538. RiverSource Distributors, Inc. (Distributor), Member FINRA.

Non-GAAP Financial Measures

The company believes the presentation of adjusted operating earnings and other non-GAAP financial measures, and the corresponding ratios, best represents the underlying performance of our core operations and facilitates a more meaningful trend analysis without the distortion of various adjustment items. Management uses non-GAAP financial measures to evaluate our financial performance on a basis comparable to that used by some securities analysts and investors and to provide a valuable perspective for investors. These non-GAAP financial measures are taken into consideration, to varying degrees, for purposes of business planning and analysis and for certain compensation-related matters. Non-GAAP financial measures are intended to supplement investors’ understanding of our performance and should not be considered alternatives for financial measures presented in accordance with GAAP. These measures are discussed in more detail below and may not be comparable to other companies’ similarly titled non-GAAP financial measures. Non-GAAP financial measure reconciliations can be found on the subsequent pages.

Forward-Looking Statements

This news release contains forward-looking statements that reflect management’s plans, estimates and beliefs. Actual results could differ materially from those described in these forward-looking statements. Examples of such forward-looking statements include:

  • statements of the company’s plans, intentions, positioning, expectations, objectives or goals, including those relating to asset flows, mass affluent and affluent client acquisition strategy, client retention and growth of our client base, financial advisor productivity, retention, recruiting and enrollments, the introduction, cessation, terms or pricing of new or existing products and services, acquisition integration, general and administrative costs, consolidated tax rate, return of capital to shareholders, and excess capital position and financial flexibility to capture additional growth opportunities;
  • statements about the expected trend in the shift of the retirement product sales business to lower risk products over time, such as products without living benefit guarantees;
  • statements about the announced acquisition of BMO’s European-based asset management business, including the expected timing to close the transaction and the expected AUM of the acquired business;
  • statements about the announced reinsurance transaction, including the occurrence of any event, change or circumstance that could give rise to changes in the amount of freed up capital (including that a regulator may prohibit, delay or refuse to grant approval for the consummation of the remaining part of the proposed transaction that reduces the expected capital release);
  • other statements about future economic performance, the performance of equity markets and interest rate variations and the economic performance of the United States and of global markets; and
  • statements estimating the expected full year operating effective tax rate;
  • statements of assumptions underlying such statements.

The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely,” “forecast,” “on track,” “project,” ”continue,” “able to remain”, “resume,” “deliver,” “develop,” “evolve,” “drive,” ”enable,” “flexibility,” “scenario, “case,” “appear,” “expands” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from such statements.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. Management cautions readers to carefully consider the risks described in the “Risk Factors” discussion under Part 1, Item 1A of and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2020 available at ir.ameriprise.com. Management undertakes no obligation to update publicly or revise any forward-looking statements.

The financial results discussed in this news release represent past performance only, which may not be used to predict or project future results. The financial results and values presented in this news release are based upon asset valuations that represent estimates as of the date of this news release and may be revised in the company’s Form 10-Q for the quarter ended June 30, 2021.

Ameriprise Financial announces financial and other information to investors through the company’s investor relations website at ir.ameriprise.com, as well as SEC filings, press releases, public conference calls and webcasts. Investors and others interested in the company are encouraged to visit the investor relations website from time to time, as information is updated and new information is posted. The website also allows users to sign up for automatic notifications in the event new materials are posted. The information found on the website is not incorporated by reference into this release or in any other report or document the company furnishes or files with the SEC.

 

Ameriprise Financial, Inc.

Consolidated GAAP Results

(in millions, except per share amounts, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

Revenues

 

 

 

 

 

 

Management and financial advice fees

$

2,251

 

 

$

1,702

 

32%

$

2,102

 

7%

Distribution fees

452

 

 

375

 

21%

458

 

(1)%

Net investment income

278

 

 

305

 

(9)%

377

 

(26)%

Premiums, policy and contract charges

364

 

 

272

 

34%

347

 

5%

Other revenues

75

 

 

76

 

(1)%

71

 

6%

Total revenues

3,420

 

 

2,730

 

25%

3,355

 

2%

Banking and deposit interest expense

2

 

 

18

 

89%

5

 

60%

Total net revenues

3,418

 

 

2,712

 

26%

3,350

 

2%

Expenses

 

 

 

 

 

 

Distribution expenses

1,233

 

 

940

 

(31)%

1,175

 

(5)%

Interest credited to fixed accounts

124

 

 

262

 

53%

159

 

22%

Benefits, claims, losses and settlement expenses

404

 

 

1,467

 

72%

653

 

38%

Amortization of deferred acquisition costs

63

 

 

(248)

 

NM

5

 

NM

Interest and debt expense

43

 

 

41

 

(5)%

42

 

(2)%

General and administrative expense

830

 

 

776

 

(7)%

823

 

(1)%

Total expenses

2,697

 

 

3,238

 

17%

2,857

 

6%

Pretax income

721

 

 

(526)

 

NM

493

 

46%

Income tax provision

130

 

 

13

 

NM

56

 

NM

Net income

$

591

 

 

$

(539)

 

NM

$

437

 

35%

 

 

 

 

 

 

 

Earnings per share

 

 

 

 

 

 

Basic earnings per share

$

4.99

 

 

$

(4.31)

 

 

$

3.65

 

 

Earnings per diluted share

$

4.88

 

 

$

(4.31)

 

 

$

3.58

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

 

 

 

 

Basic

118.4

 

 

125.0

 

 

119.8

 

 

Diluted

121.2

 

 

126.2

 

 

122.2

 

 

 

 

 

 

 

 

 

NM Not Meaningful - variance equal to or greater than 100%

 

Ameriprise Financial, Inc.

Consolidated Highlights and Capital Summary

(in millions unless otherwise noted, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Assets Under Management and Administration

 

 

 

 

 

Advice & Wealth Management AUM

$

426,500

 

 

$

314,820

 

35%

$

396,533

 

8%

Asset Management AUM

593,366

 

 

476,121

 

25%

564,131

 

5%

Corporate AUM

100

 

 

71

 

41%

97

 

3%

Eliminations

(42,025)

 

 

(31,928)

 

(32)%

(39,655)

 

(6)%

Total Assets Under Management

977,941

 

 

759,084

 

29%

921,106

 

6%

Total Assets Under Administration

233,334

 

 

187,696

 

24%

222,887

 

5%

Total AUM and AUA

$

1,211,275

 

 

$

946,780

 

28%

$

1,143,993

 

6%

 

 

 

 

 

 

 

S&P 500

 

 

 

 

 

 

Daily average

4,182

 

 

2,927

 

43%

3,861

 

8%

Period end

4,298

 

 

3,100

 

39%

3,973

 

8%

 

 

 

 

 

 

 

Weighted Equity Index (WEI) (1)

 

 

 

 

 

 

Daily average

2,858

 

 

1,975

 

45%

2,662

 

7%

Period end

2,921

 

 

2,099

 

39%

2,725

 

7%

 

 

 

 

 

 

 

Common shares

 

 

 

 

 

 

Beginning balance

116.0

 

 

122.3

 

(5)%

116.8

 

(1)%

Repurchases

(1.7)

 

 

(1.7)

 

-

(1.7)

 

-

Issuances

0.2

 

 

 

-

1.8

 

(89)%

Other

(0.2)

 

 

 

-

(0.9)

 

78%

Total common shares outstanding

114.3

 

 

120.6

 

(5)%

116.0

 

(1)%

Restricted stock units

3.1

 

 

3.2

 

(3)%

3.0

 

3%

Total basic common shares outstanding

117.4

 

 

123.8

 

(5)%

119.0

 

(1)%

Total potentially dilutive shares

2.7

 

 

1.8

 

50%

2.5

 

8%

Total diluted shares

120.1

 

 

125.6

 

(4)%

121.5

 

(1)%

 

 

 

 

 

 

 

Capital Returned to Shareholders

 

 

 

 

 

 

Dividends paid

$

135

 

 

$

131

 

3%

$

128

 

5%

Common stock share repurchases

450

 

 

251

 

79%

363

 

24%

Total Capital Returned to Shareholders

$

585

 

 

$

382

 

53%

$

491

 

19%

 

 

 

 

 

 

 

(1) Weighted Equity Index is an Ameriprise calculated proxy for equity market movements calculated using a weighted average of the S&P 500, Russell 2000, Russell Midcap and MSCI EAFE indices based on North America distributed equity assets.

 

 

Ameriprise Financial, Inc.

Advice & Wealth Management Segment Adjusted Operating Results

(in millions, unaudited)

2 Qtr 2021

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Management and financial advice fees:

 

 

 

 

 

 

 

 

Advisory fees

$

1,113

 

 

$

797

 

 

40%

$

1,028

 

 

8%

Financial planning fees

93

 

 

86

 

 

8%

88

 

 

6%

Transaction and other fees

93

 

 

86

 

 

8%

89

 

 

4%

Total management and financial advice fees

1,299

 

 

969

 

 

34%

1,205

 

 

8%

Distribution fees:

 

 

 

 

 

 

 

 

Mutual funds

212

 

 

170

 

 

25%

207

 

 

2%

Insurance and annuity

252

 

 

196

 

 

29%

240

 

 

5%

Other products

98

 

 

87

 

 

13%

112

 

 

(13)%

Total distribution fees

562

 

 

453

 

 

24%

559

 

 

1%

Net investment income

63

 

 

77

 

 

(18)%

64

 

 

(2)%

Other revenues

58

 

 

56

 

 

4%

56

 

 

4%

Total revenues

1,982

 

 

1,555

 

 

27%

1,884

 

 

5%

Banking and deposit interest expense

2

 

 

18

 

 

89%

5

 

 

60%

Adjusted operating total net revenues

1,980

 

 

1,537

 

 

29%

1,879

 

 

5%

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

Distribution expenses

1,194

 

 

913

 

 

(31)%

1,135

 

 

(5)%

Interest and debt expense

2

 

 

3

 

 

33%

3

 

 

33%

General and administrative expense

361

 

 

350

 

 

(3)%

352

 

 

(3)%

Adjusted operating expenses

1,557

 

 

1,266

 

 

(23)%

1,490

 

 

(4)%

Pretax adjusted operating earnings

$

423

 

 

$

271

 

 

56%

$

389

 

 

9%

 

 

 

 

 

 

 

 

 

Pretax adjusted operating margin

21.4

 

%

17.6

 

%

 

20.7

 

%

 

 

 

 

 

 

 

 

 

 

Pretax adjusted operating earnings by product

 

 

 

 

 

 

 

 

Certificates and Banking - Combined

$

18

 

 

$

18

 

 

-

$

19

 

 

(5)%

Wealth Management & Distribution

405

 

 

253

 

 

60%

370

 

 

9%

Pretax adjusted operating earnings

$

423

 

 

$

271

 

 

56%

$

389

 

 

9%

 

 

 

 

 

 

 

 

 

 

Ameriprise Financial, Inc.

Advice & Wealth Management Segment Operating Metrics

(in millions unless otherwise noted, unaudited)

2 Qtr 2021

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

 

 

AWM Total Client Assets

$

807,335

 

 

$

630,202

 

 

28%

$

761,566

 

 

6%

 

 

 

 

 

 

 

 

 

Total Client Flows (1)

$

9,530

 

 

$

6,182

 

 

54%

$

9,305

 

 

2%

 

 

 

 

 

 

 

 

 

Total Wrap Accounts

 

 

 

 

 

 

 

 

Beginning assets

$

399,817

 

 

$

275,505

 

 

45%

$

380,013

 

 

5%

Net flows (2)

10,024

 

 

5,623

 

 

78%

10,413

 

 

(4)%

Market appreciation (depreciation) and other (2)

20,162

 

 

36,487

 

 

(45)%

9,391

 

 

NM

Total wrap ending assets

$

430,003

 

 

$

317,615

 

 

35%

$

399,817

 

 

8%

 

 

 

 

 

 

 

 

 

Advisory wrap account assets ending balance (3)

$

425,200

 

 

$

313,898

 

 

35%

$

395,299

 

 

8%

 

 

 

 

 

 

 

 

 

Brokerage Cash & Certificates Balances

 

 

 

 

 

 

 

 

On-balance sheet (Net Investment Income)

 

 

 

 

 

 

 

 

On-balance sheet - broker dealer

$

3,383

 

 

$

3,332

 

 

2%

$

3,385

 

 

-

On-balance sheet - bank

8,671

 

 

5,298

 

 

64%

7,985

 

 

9%

On-balance sheet - certificate

5,749

 

 

7,451

 

 

(23)%

6,258

 

 

(8)%

Total on-balance sheet

$

17,803

 

 

$

16,081

 

 

11%

$

17,628

 

 

1%

Off-balance sheet (Distribution Fees)

 

 

 

 

 

 

 

 

Off-balance sheet - broker dealer

$

21,391

 

 

$

22,498

 

 

(5)%

$

22,733

 

 

(6)%

Total brokerage cash & certificates balances

$

39,194

 

 

$

38,579

 

 

2%

$

40,361

 

 

(3)%

 

 

 

 

 

 

 

 

 

Gross Fee Yield

 

 

 

 

 

 

 

 

On-balance sheet - broker dealer

0.05

 

%

0.10

 

%

 

0.10

 

%

 

On-balance sheet - bank

1.32

 

%

1.65

 

%

 

1.37

 

%

 

On-balance sheet - certificates

1.13

 

%

1.83

 

%

 

1.22

 

%

 

Off-balance sheet - broker dealer

0.27

 

%

0.27

 

%

 

0.28

 

%

 

 

 

 

 

 

 

 

 

 

Weighted Average Gross Fee Yield

0.63

 

%

0.79

 

%

 

0.65

 

%

 

 

 

 

 

 

 

 

 

 

Financial Advisors

 

 

 

 

 

 

 

 

Employee advisors

2,104

 

2,116

 

(1)%

2,107

 

-

Franchisee advisors

7,943

 

7,778

 

2%

7,924

 

-

Total financial advisors

10,047

 

9,894

 

2%

10,031

 

-

 

 

 

 

 

 

 

 

 

Advisor Retention

 

 

 

 

 

 

 

 

Employee

91.4

 

%

90.9

 

%

 

92.0

 

%

 

Franchisee

94.1

 

%

93.4

 

%

 

94.4

 

%

 

 

 

 

 

 

 

 

 

 

(1) Total client flows represent inflows of client cash and securities less client outfows. Inflows include dividends and interest; outflows include fees. Excludes short-term and long-term capital gain distributions.

(2) Beginning in Q1 2021, wrap net flows is calculated including dividends and interest less fees, which were previously recorded in market appreciation (depreciation) and other. Net flows excludes short-term and long-term capital gain distributions. Prior periods have been restated.

(3) Advisory wrap account assets represent those assets for which clients receive advisory services and are the primary driver of revenue earned on wrap accounts. Clients may hold non-advisory investments in their wrap accounts that do not incur an advisory fee.

NM Not Meaningful - variance equal to or greater than 100%

 

Ameriprise Financial, Inc.

Asset Management Segment Adjusted Operating Results

(in millions, unaudited)

2 Qtr 2021

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Management and financial advice fees:

 

 

 

 

 

 

 

 

Asset management fees:

 

 

 

 

 

 

 

 

Retail

$

567

 

 

$

417

 

 

36%

$

531

 

 

7%

Institutional

131

 

 

101

 

 

30%

123

 

 

7%

Transaction and other fees

56

 

 

45

 

 

24%

52

 

 

8%

Revenue from other sources (1)

4

 

 

7

 

 

(43)%

7

 

 

(43)%

Total management and financial advice fees

758

 

 

570

 

 

33%

713

 

 

6%

Distribution fees:

 

 

 

 

 

 

 

 

Mutual funds

69

 

 

55

 

 

25%

67

 

 

3%

Insurance and annuity

49

 

 

41

 

 

20%

47

 

 

4%

Total distribution fees

118

 

 

96

 

 

23%

114

 

 

4%

Net investment income

2

 

 

1

 

 

NM

1

 

 

NM

Other revenues

1

 

 

1

 

 

-

 

 

-

Total revenues

879

 

 

668

 

 

32%

828

 

 

6%

Banking and deposit interest expense

 

 

 

 

-

 

 

-

Adjusted operating total net revenues

879

 

 

668

 

 

32%

828

 

 

6%

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

Distribution expenses

282

 

 

220

 

 

(28)%

268

 

 

(5)%

Amortization of deferred acquisition costs

3

 

 

3

 

 

-

3

 

 

-

Interest and debt expense

1

 

 

1

 

 

-

1

 

 

-

General and administrative expense

340

 

 

303

 

 

(12)%

328

 

 

(4)%

Adjusted operating expenses

626

 

 

527

 

 

(19)%

600

 

 

(4)%

Pretax adjusted operating earnings

$

253

 

 

$

141

 

 

79%

$

228

 

 

11%

 

 

 

 

 

 

 

 

 

Net Pretax Adjusted Operating Margin Reconciliation

 

 

 

 

 

 

 

Adjusted operating total net revenues

$

879

 

 

$

668

 

 

32%

$

828

 

 

6%

Distribution pass thru revenues

(225)

 

 

(177)

 

 

(27)%

(217)

 

 

(4)%

Subadvisory and other pass thru revenues

(94)

 

 

(76)

 

 

(24)%

(87)

 

 

(8)%

Net adjusted operating revenues

$

560

 

 

$

415

 

 

35%

$

524

 

 

7%

 

 

 

 

 

 

 

 

 

Pretax adjusted operating earnings

$

253

 

 

$

141

 

 

79%

$

228

 

 

11%

Adjusted operating net investment income

(2)

 

 

(1)

 

 

NM

(1)

 

 

NM

Amortization of intangibles

3

 

 

3

 

 

-

3

 

 

-

Net adjusted operating earnings

$

254

 

 

$

143

 

 

78%

$

230

 

 

10%

 

 

 

 

 

 

 

 

 

Pretax adjusted operating margin

28.8

 

%

21.1

 

%

 

27.5

 

%

 

Net pretax adjusted operating margin (2)

45.4

 

%

34.5

 

%

 

43.9

 

%

 

 

 

 

 

 

 

 

 

 

Performance fees (3)

 

 

 

 

 

 

 

 

Performance fees

$

3

 

 

$

1

 

 

NM

$

1

 

 

NM

Performance fee related to general and administrative expense

 

 

 

 

-

 

 

-

Net performance fees

$

3

 

 

$

1

 

 

NM

$

1

 

 

NM

 

 

 

 

 

 

 

 

 

(1) Includes revenue from separate accounts that qualify as investment contracts under insurance accounting standards.

(2) Calculated as net adjusted operating earnings as a percentage of net adjusted operating revenues.

(3) Performance fees do not include CLO incentive fees.

NM Not Meaningful - variance equal to or greater than 100%.

 

Ameriprise Financial, Inc.

Asset Management Segment Operating Metrics

(in millions, unaudited)

2 Qtr 2021

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

 

 

Total Managed Assets by Type

 

 

 

 

 

 

 

 

Equity

$

339,032

 

 

$

251,362

 

 

35%

$

319,446

 

 

6%

Fixed income

203,101

 

 

183,061

 

 

11%

195,020

 

 

4%

Money market

5,484

 

 

4,997

 

 

10%

5,766

 

 

(5)%

Alternative

3,839

 

 

3,148

 

 

22%

3,841

 

 

-

Hybrid and other

41,910

 

 

33,553

 

 

25%

40,058

 

 

5%

Total managed assets by type

$

593,366

 

 

$

476,121

 

 

25%

$

564,131

 

 

5%

 

 

 

 

 

 

 

 

 

Average Managed Assets by Type (1)

 

 

 

 

 

 

 

 

Equity

$

330,801

 

 

$

235,797

 

 

40%

$

308,816

 

 

7%

Fixed income

200,246

 

 

178,986

 

 

12%

195,823

 

 

2%

Money market

5,823

 

 

5,121

 

 

14%

5,921

 

 

(2)%

Alternative

3,812

 

 

2,956

 

 

29%

3,775

 

 

1%

Hybrid and other

41,148

 

 

33,457

 

 

23%

39,212

 

 

5%

Total average managed assets by type

$

581,830

 

 

$

456,317

 

 

28%

$

553,547

 

 

5%

 

 

 

 

 

 

 

 

 

Managed Assets Rollforward

 

 

 

 

 

 

 

 

Global Retail Funds

 

 

 

 

 

 

 

 

Beginning assets

$

340,270

 

 

$

239,038

 

 

42%

$

323,483

 

 

5%

Inflows

19,371

 

 

15,925

 

 

22%

22,549

 

 

(14)%

Outflows

(17,075)

 

 

(14,231)

 

 

(20)%

(17,637)

 

 

3%

Net VP/VIT fund flows

(967)

 

 

(625)

 

 

(55)%

(1,019)

 

 

5%

Net new flows

1,329

 

 

1,069

 

 

24%

3,893

 

 

(66)%

Reinvested dividends

2,874

 

 

1,983

 

 

45%

717

 

 

NM

Net flows

4,203

 

 

3,052

 

 

38%

4,610

 

 

(9)%

Distributions

(3,375)

 

 

(2,266)

 

 

(49)%

(858)

 

 

NM

Market appreciation (depreciation) and other

18,113

 

 

34,278

 

 

(47)%

13,187

 

 

37%

Foreign currency translation (2)

265

 

 

34

 

 

NM

(152)

 

 

NM

Total ending assets

359,476

 

 

274,136

 

 

31%

340,270

 

 

6%

% of total retail assets sub-advised

15.9

 

%

19.2

 

%

 

16.4

 

%

 

 

 

 

 

 

 

 

 

 

Global Institutional

 

 

 

 

 

 

 

 

Beginning assets

223,861

 

 

187,125

 

 

20%

223,130

 

 

-

Inflows (3)

9,320

 

 

6,437

 

 

45%

7,741

 

 

20%

Outflows (3)

(6,853)

 

 

(6,892)

 

 

1%

(7,462)

 

 

8%

Net flows

2,467

 

 

(455)

 

 

NM

279

 

 

NM

Market appreciation (depreciation) and other (4)

7,125

 

 

15,745

 

 

(55)%

176

 

 

NM

Foreign currency translation (2)

437

 

 

(430)

 

 

NM

276

 

 

58%

Total ending assets

233,890

 

 

201,985

 

 

16%

223,861

 

 

4%

 

 

 

 

 

 

 

 

 

Total managed assets

$

593,366

 

 

$

476,121

 

 

25%

$

564,131

 

 

5%

 

 

 

 

 

 

 

 

 

Total net flows

$

6,670

 

 

$

2,597

 

 

NM

$

4,889

 

 

36%

 

 

 

 

 

 

 

 

 

Legacy insurance partners flows

$

(1,353)

 

 

$

(1,270)

 

 

(7)%

$

(1,262)

 

 

(7)%

 

 

 

 

 

 

 

 

 

Total Assets Under Advisement (5)

$

18,036

 

 

$

10,454

 

 

73%

$

16,036

 

 

12%

Model delivery AUA flows (6)

$

912

 

 

$

315

 

 

NM

$

294

 

 

NM

 

 

 

 

 

 

 

 

 

(1) Average ending balances are calculated using the average of the prior period’s ending balance and all months in the current period.

(2) Amounts represent local currency to US dollar translation for reporting purposes.

(3) Global Institutional inflows and outflows include net flows from our RiverSource Structured Annuity product beginning in Q1 2020 and Ameriprise Bank, FSB beginning in Q1 2021.

(4) Included in Market appreciation (depreciation) and other for Global Institutional is the change in affiliated general account balance excluding net flows related to our Structured Annuity product beginning in Q1 2020 and Ameriprise Bank, FSB beginning in Q1 2021.

(5) Assets are presented on a one-quarter lag.

(6) Estimated flows based on the period to period change in assets less calculated performance based on strategy returns on a one-quarter lag.

NM Not Meaningful - variance equal to or greater than 100%.

 

Ameriprise Financial, Inc.

Asset Management Segment Performance Metrics

 

2 Qtr 2021

 

 

 

 

 

Retail Fund Rankings in Top 2 Quartiles or Above Index Benchmark - Asset Weighted

1 year

3 year

5 year

10 year

Equity

61%

87%

87%

88%

Fixed Income

87%

73%

91%

90%

Asset Allocation

39%

88%

95%

89%

 

 

 

 

 

4- or 5-star Morningstar rated funds

Overall

3 year

5 year

10 year

Number of Rated Funds

110

100

98

88

Percent of Rated Assets

71%

64%

63%

73%

 

 

 

 

 

Retail Fund performance rankings for each fund is measured on a consistent basis against the most appropriate peer group or index. Peer Groupings are defined by either Lipper, IA, or Morningstar and based primarily on the Institutional Share Class, Net of Fees. Comparisons to Index are measured Gross of Fees.

 

 

 

 

 

To calculate asset weighted performance, the sum of the total assets of the funds with above median ranking are divided by total assets of all funds. Funds with more assets will receive a greater share of the total percentage above or below median.

 

 

 

 

 

Aggregated Asset Allocation Funds may include funds that invest in other Columbia or Threadneedle branded mutual funds included in both equity and fixed income.

 

 

 

 

 

Morningstar as of 06/30/21. Columbia funds are available for purchase by U.S. customers. Out of 90 Columbia funds (Inst. shares) rated, 18 received a 5-star Overall Rating and 37 received a 4-star Overall Rating. Out of 94 Threadneedle funds (highest rated share class) rated, 20 received a 5-star Overall Rating and 35 received a 4-star Overall Rating. The Overall Morningstar Rating is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics. Not all funds are available in all jurisdictions, to all investors or through all firms.

 

© 2021 Morningstar. All rights reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

 

 

 

 

 

 

Ameriprise Financial, Inc.

Retirement & Protection Solutions Segment (1) Adjusted Operating Results

(in millions, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

Management and financial advice fees

$

234

 

 

$

200

 

17%

$

222

 

5%

Distribution fees

122

 

 

106

 

15%

116

 

5%

Net investment income

127

 

 

129

 

(2)%

126

 

1%

Premiums, policy and contract charges

325

 

 

320

 

2%

323

 

1%

Other revenues

 

 

 

-

 

-

Total revenues

808

 

 

755

 

7%

787

 

3%

Banking and deposit interest expense

 

 

 

-

 

-

Adjusted operating total net revenues

808

 

 

755

 

7%

787

 

3%

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

Distribution expenses

134

 

 

111

 

(21)%

129

 

(4)%

Interest credited to fixed accounts

98

 

 

97

 

(1)%

96

 

(2)%

Benefits, claims, losses and settlement expenses

241

 

 

212

 

(14)%

234

 

(3)%

Amortization of deferred acquisition costs

70

 

 

30

 

NM

63

 

(11)%

Interest and debt expense

9

 

 

11

 

18%

10

 

10%

General and administrative expense

74

 

 

72

 

(3)%

72

 

(3)%

Adjusted operating expenses

626

 

 

533

 

(17)%

604

 

(4)%

Pretax adjusted operating earnings

$

182

 

 

$

222

 

(18)%

$

183

 

(1)%

 

 

 

 

 

 

 

(1) Retirement & Protection Solutions segment includes Retirement Solutions (Variable Annuities and Payout Annuities) and Protection Solutions (Life and Disability Insurance). Fixed Annuities moved to the Corporate & Other segment in Q3 2020 as a closed block. Prior periods have been restated.

NM Not Meaningful - variance equal to or greater than 100%

Ameriprise Financial, Inc.

Retirement & Protection Solutions Segment Operating Metrics

(in millions, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Variable Annuities Rollforwards

 

 

 

 

 

 

Beginning balance

$

86,964

 

 

$

69,959

 

24%

$

85,774

 

1%

Deposit

1,597

 

 

850

 

88%

1,428

 

12%

Withdrawals and terminations

(1,946)

 

 

(1,320)

 

(47)%

(1,984)

 

2%

Net flows

(349)

 

 

(470)

 

26%

(556)

 

37%

Investment performance and interest credited

3,879

 

 

7,992

 

(51)%

1,746

 

NM

Other

 

 

 

-

 

-

Total ending balance - contract accumulation values

$

90,494

 

 

$

77,481

 

17%

$

86,964

 

4%

 

 

 

 

 

 

 

Variable annuities fixed sub-accounts

$

5,052

 

 

$

5,103

 

(1)%

$

5,075

 

-

 

 

 

 

 

 

 

Payout Annuities Reserve Balance

$

1,870

 

 

$

2,008

 

(7)%

$

1,908

 

(2)%

 

 

 

 

 

 

 

Life Insurance In Force

$

196,794

 

 

$

194,980

 

1%

$

196,164

 

-

 

 

 

 

 

 

 

Net Amount at Risk (Life)

$

37,465

 

 

$

38,950

 

(4)%

$

37,636

 

-

 

 

 

 

 

 

 

Net Policyholder Reserves

 

 

 

 

 

 

VUL/UL

$

14,593

 

 

$

12,387

 

18%

$

14,106

 

3%

Term and whole life

171

 

 

178

 

(4)%

172

 

(1)%

Disability insurance

494

 

 

505

 

(2)%

503

 

(2)%

Other insurance

629

 

 

661

 

(5)%

637

 

(1)%

Total net policyholder reserves

$

15,887

 

 

$

13,731

 

16%

$

15,418

 

3%

 

 

 

 

 

 

 

DAC Ending Balances

 

 

 

 

 

 

Variable Annuities DAC

$

1,799

 

 

$

1,614

 

11%

$

1,792

 

-

Life and Health DAC

$

799

 

 

$

836

 

(4)%

$

839

 

(5)%

 

 

 

 

 

 

 

NM Not Meaningful - variance equal to or greater than 100%

Ameriprise Financial, Inc.

Corporate Segment Adjusted Operating Results and Metrics

(in millions, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Corporate Excluding Long Term Care and Fixed Annuities Adjusted Operating Income Statements

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

Management and financial advice fees

$

 

 

$

 

-

$

 

-

Distribution fees

 

 

 

-

 

-

Net investment income

(20)

 

 

(22)

 

9%

(1)

 

NM

Premiums, policy and contract charges

1

 

 

 

-

 

-

Other revenues

3

 

 

4

 

(25)%

1

 

NM

Total revenues

(16)

 

 

(18)

 

11%

 

-

Banking and deposit interest expense

1

 

 

1

 

-

 

-

Adjusted operating total net revenues

(17)

 

 

(19)

 

11%

 

-

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

Distribution expenses

 

 

 

-

 

-

Interest credited to fixed accounts

 

 

 

-

 

-

Benefits, claims, losses and settlement expenses

 

 

 

-

 

-

Amortization of deferred acquisition costs

 

 

 

-

 

-

Interest and debt expense

9

 

 

9

 

-

7

 

(29)%

General and administrative expense

48

 

 

49

 

2%

56

 

14%

Adjusted operating expenses

57

 

 

58

 

2%

63

 

10%

Pretax adjusted operating earnings (loss)

$

(74)

 

 

$

(77)

 

4%

$

(63)

 

(17)%

 

 

 

 

 

 

 

NM Not Meaningful - variance equal to or greater than 100%

 

 

 

 

 

 

 

Ameriprise Financial, Inc.

Corporate Segment Adjusted Operating Results and Metrics

(in millions, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Long Term Care Adjusted Operating Income Statements

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

Management and financial advice fees

$

 

 

$

 

-

$

 

-

Distribution fees

 

 

 

-

 

-

Net investment income

38

 

 

40

 

(5)%

38

 

-

Premiums, policy and contract charges

24

 

 

25

 

(4)%

24

 

-

Other revenues

 

 

 

-

 

-

Total revenues

62

 

 

65

 

(5)%

62

 

-

Banking and deposit interest expense

 

 

 

-

 

-

Adjusted operating total net revenues

62

 

 

65

 

(5)%

62

 

-

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

Distribution expenses

(3)

 

 

(3)

 

-

(3)

 

-

Interest credited to fixed accounts

 

 

 

-

 

-

Benefits, claims, losses and settlement expenses

52

 

 

42

 

(24)%

11

 

NM

Amortization of deferred acquisition costs

 

 

 

-

 

-

Interest and debt expense

2

 

 

2

 

-

3

 

33%

General and administrative expense

8

 

 

7

 

(14)%

5

 

(60)%

Adjusted operating expenses

59

 

 

48

 

(23)%

16

 

NM

Pretax adjusted operating earnings (loss)

$

3

 

 

$

17

 

(82)%

$

46

 

(93)%

 

 

 

 

 

 

 

Long Term Care Policyholder Reserves, net of reinsurance (1)

 

 

 

 

 

 

Active Life Reserves

$

2,514

 

 

$

2,249

 

12%

$

2,431

 

3%

Disabled Life Reserves

548

 

 

569

 

(4)%

540

 

1%

Total long term care policyholder reserves, net of reinsurance

$

3,062

 

 

$

2,818

 

9%

$

2,971

 

3%

 

 

 

 

 

 

 

(1) SFAS 115 requires GAAP reserves to include all unrealized gains on available for sale securities in the portfolio to be reported as if they were realized on the last day of the accounting period with all financial impacts flowing through other comprehensive income.

NM Not Meaningful - variance equal to or greater than 100%

 

Ameriprise Financial, Inc.

Corporate Segment (1) Adjusted Operating Results and Metrics

(in millions, unaudited)

2 Qtr 2021

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

 

 

Fixed Annuities Adjusted Operating Income Statements

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Management and financial advice fees

$

 

 

$

 

 

-

$

 

 

-

Distribution fees

 

 

 

 

-

 

 

-

Net investment income

61

 

 

70

 

 

(13)%

63

 

 

(3)%

Premiums, policy and contract charges

 

 

 

 

-

 

 

-

Other revenues

13

 

 

15

 

 

(13)%

14

 

 

(7)%

Total revenues

74

 

 

85

 

 

(13)%

77

 

 

(4)%

Banking and deposit interest expense

 

 

 

 

-

 

 

-

Adjusted operating total net revenues

74

 

 

85

 

 

(13)%

77

 

 

(4)%

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

Distribution expenses

1

 

 

1

 

 

-

1

 

 

-

Interest credited to fixed accounts

62

 

 

64

 

 

3%

61

 

 

(2)%

Benefits, claims, losses and settlement expenses

2

 

 

 

 

-

2

 

 

-

Amortization of deferred acquisition costs

2

 

 

3

 

 

33%

4

 

 

50%

Interest and debt expense

6

 

 

5

 

 

(20)%

5

 

 

(20)%

General and administrative expense

7

 

 

9

 

 

22%

8

 

 

13%

Adjusted operating expenses

80

 

 

82

 

 

2%

81

 

 

1%

Pretax adjusted operating earnings (loss)

$

(6)

 

 

$

3

 

 

NM

$

(4)

 

 

(50)%

 

 

 

 

 

 

 

 

 

Fixed Deferred Annuities - ending balance - contract accumulation values

$

7,771

 

 

$

8,116

 

 

(4)%

$

7,850

 

 

(1)%

 

 

 

 

 

 

 

 

 

Tax Equivalent Spread - Fixed Deferred Annuities (2)

 

 

 

 

 

 

 

 

Gross rate of return of invested assets

2.8

 

%

3.6

 

%

 

3.1

 

%

 

Crediting rate excluding capitalized interest

(3.3)

 

%

(3.3)

 

%

 

(3.3)

 

%

 

Tax equivalent margin spread

(0.5)

 

%

0.3

 

%

 

(0.2)

 

%

 

 

 

 

 

 

 

 

 

 

Fixed Deferred Annuities DAC Ending Balance

$

46

 

 

$

44

 

 

5%

$

48

 

 

(4)%

 

 

 

 

 

 

 

 

 

(1) Fixed annuities was moved into the Corporate & Other segment as a closed block. Prior periods have been restated.

(2) Attributable to interest sensitive products only, which has been approximately 99% of the total ending fixed deferred annuities accumulation values in the periods reported. The asset earnings rate is a calculated yield based on specifically assigned assets.

NM Not Meaningful - variance equal to or greater than 100%

 

Ameriprise Financial, Inc.

Eliminations (1) Adjusted Operating Results

(in millions, unaudited)

2 Qtr 2021

 

2 Qtr 2020

% Over/
(Under)

1 Qtr 2021

% Over/
(Under)

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

Management and financial advice fees

$

(38)

 

 

$

(35)

 

(9)%

$

(36)

 

(6)%

Distribution fees

(350)

 

 

(280)

 

(25)%

(331)

 

(6)%

Net investment income

(5)

 

 

(4)

 

(25)%

(4)

 

(25)%

Premiums, policy and contract charges

(7)

 

 

(8)

 

13%

(8)

 

13%

Other revenues

 

 

 

-

 

-

Total revenues

(400)

 

 

(327)

 

(22)%

(379)

 

(6)%

Banking and deposit interest expense

(1)

 

 

(1)

 

-

 

-

Adjusted operating total net revenues

(399)

 

 

(326)

 

(22)%

(379)

 

(5)%

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

Distribution expenses

(375)

 

 

(302)

 

24%

(355)

 

6%

Interest credited to fixed accounts

 

 

 

-

 

-

Benefits, claims, losses and settlement expenses

(5)

 

 

(3)

 

67%

(4)

 

25%

Amortization of deferred acquisition costs

 

 

 

-

 

-

Interest and debt expense

(3)

 

 

(5)

 

(40)%

(3)

 

-

General and administrative expense

(16)

 

 

(16)

 

-

(17)

 

(6)%

Adjusted operating expenses

(399)

 

 

(326)

 

22%

(379)

 

5%

Pretax adjusted operating earnings (loss)

$

 

 

$

 

-

$

 

-

 

 

 

 

 

 

 

(1) The majority of the amounts represent the impact of inter-segment transfer pricing for both revenues and expenses.

 

 

Ameriprise Financial, Inc.

 

Capital Information

 

(in millions, unaudited)

June 30,
2021

June 30,
2020

March 31,
2021

 

 

 

 

 

 

 

Long-term Debt Summary

 

 

 

 

 

 

Senior notes

$

2,800

 

 

$

2,800

 

 

$

2,800

 

 

Finance lease liabilities

44

 

 

51

 

 

46

 

 

 

Fair value of hedges, unamortized discount and debt issuance costs

(11)

 

 

(16)

 

 

(12)

 

 

Total Ameriprise Financial long-term debt

2,833

 

 

2,835

 

 

2,834

 

 

Non-recourse debt of consolidated investment entities

2,558

 

 

1,489

 

 

2,671

 

 

Total long-term debt

$

5,391

 

 

$

4,324

 

 

$

5,505

 

 

 

 

 

 

 

 

 

Total Ameriprise Financial long-term debt

$

2,833

 

 

$

2,835

 

 

$

2,834

 

 

 

Fair value of hedges, unamortized discount and debt issuance costs

11

 

 

16

 

 

12

 

 

Finance lease liabilities

(44)

 

 

(51)

 

 

(46)

 

 

Total Ameriprise Financial long-term debt excluding fair value of hedges, unamortized discount, debt issuance costs and finance lease liabilities

$

2,800

 

 

$

2,800

 

 

$

2,800

 

 

 

 

 

 

 

 

 

Total equity (1)

$

5,686

 

 

$

6,500

 

 

$

5,502

 

 

Equity of consolidated investment entities

(6)

 

 

(5)

 

 

(1)

 

 

Total equity excluding CIEs

$

5,680

 

 

$

6,495

 

 

$

5,501

 

 

 

 

 

 

 

 

 

Total Ameriprise Financial capital

$

8,519

 

 

$

9,335

 

 

$

8,336

 

 

Total Ameriprise Financial capital excluding fair value of hedges, unamortized discount, debt issuance costs, finance lease liabilities and equity of CIEs

$

8,480

 

 

$

9,295

 

 

$

8,301

 

 

 

 

 

 

 

 

 

Debt to capital

 

 

 

 

 

 

Total Ameriprise Financial long-term debt to total Ameriprise Financial capital

33.3

 

%

30.4

 

%

34.0

 

%

Total Ameriprise Financial long-term debt to total Ameriprise Financial capital excluding fair value of hedges, unamortized discount, best issuance costs, finance lease liabilities and equity of CIEs (1)

33.0

 

%

30.1

 

%

33.7

 

%

 

 

 

 

 

 

 

(1) Includes accumulated other comprehensive income, net of tax.

 

 

 

Ameriprise Financial, Inc.

Consolidated Balance Sheets

(in millions, unaudited)

June 30,
2021

 

December 31,
2020

 

 

 

 

 

 

Assets

 

 

 

 

Cash and cash equivalents

$

7,121

 

 

$

6,751

 

 

Cash of consolidated investment entities

95

 

 

94

 

 

Investments

40,745

 

 

41,031

 

 

Investments of consolidated investment entities

2,611

 

 

1,918

 

 

Separate account assets

96,854

 

 

92,611

 

 

Receivables

8,030

 

 

7,819

 

 

Receivables of consolidated investment entities

48

 

 

16

 

 

Deferred acquisition costs

2,650

 

 

2,532

 

 

Restricted and segregated cash and investments

2,382

 

 

2,558

 

 

Other assets

11,165

 

 

10,551

 

 

Other assets of consolidated investment entities

2

 

 

2

 

 

Total Assets

$

171,703

 

 

$

165,883

 

 

 

 

 

 

 

Liabilities

 

 

 

 

Policyholder account balances, future policy benefits and claims

$

34,222

 

 

$

33,992

 

 

Separate account liabilities

96,854

 

 

92,611

 

 

Customer deposits

17,796

 

 

17,641

 

 

Short-term borrowings

200

 

 

200

 

 

Long-term debt

2,833

 

 

2,831

 

 

Debt of consolidated investment entities

2,558

 

 

1,913

 

 

Accounts payable and accrued expenses

2,034

 

 

1,998

 

 

Other liabilities

9,381

 

 

8,761

 

 

Other liabilities of consolidated investment entities

139

 

 

69

 

 

Total Liabilities

166,017

 

 

160,016

 

 

 

 

 

 

 

Equity

 

 

 

 

Ameriprise Financial

 

 

 

 

Common shares ($.01 par)

3

 

 

3

 

 

Additional paid-in capital

9,049

 

 

8,822

 

 

Retained earnings

16,057

 

 

15,292

 

 

Treasury stock

(19,883)

 

 

(18,879)

 

 

Accumulated other comprehensive income, net of tax

460

 

 

629

 

 

Total Equity

5,686

 

 

5,867

 

 

Total Liabilities and Equity

$

171,703

 

 

$

165,883

 

 

 

 

 

 

 

 

Ameriprise Financial, Inc.

Disclosed Items - Included in Adjusted Operating Earnings

(in millions, unaudited)

 

2 Qtr 2021

 

 

 

 

 

Corporate

 

 

Affordable Housing
Investment
Adjustment (1)

Revenues

 

 

Management and financial advice fees

 

$

 

Distribution fees

 

 

Net investment income

 

(7)

 

Premiums, policy and contract charges

 

 

Other revenues

 

 

Total revenues

 

(7)

 

Banking and deposit interest expense

 

 

Adjusted operating total net revenues

 

(7)

 

 

 

 

Expenses

 

 

Distribution expenses

 

 

Interest credited to fixed accounts

 

 

Benefits, claims, losses and settlement expenses

 

 

Amortization of deferred acquisition costs

 

 

Interest and debt expense

 

 

General and administrative expense

 

 

Adjusted operating expenses

 

 

Pretax adjusted operating earnings (loss)

 

$

(7)

 

 

 

 

(1) Adjustment for an affordable housing investment to align it with the remaining tax benefit cash flows

 

 

Ameriprise Financial, Inc.

Reconciliation Table: Earnings

 

Quarter Ended
June 30,

 

Per Diluted Share
Quarter Ended
June 30,

 

% Over/
(Under)

(in millions, except per share amounts, unaudited)

2021

 

2020

 

2021

 

2020

 

Net income

$

591

 

 

$

(539)

 

 

$

4.88

 

 

$

(4.31)

 

(3)

NM

Add: Basic to diluted share conversion

 

 

 

 

 

 

0.04

 

(4)

 

Less: Net realized investment gains (losses) (1)

11

 

 

(2)

 

 

0.09

 

 

(0.02)

 

 

 

Add: Market impact on non-traditional long-duration products (1)

87

 

 

1,113

 

 

0.71

 

 

8.82

 

 

 

Add: Mean reversion-related impacts (1)

(42)

 

 

(14)

 

 

(0.35)

 

 

(0.12)

 

 

 

Add: Market impact of hedges on investments (1)

17

 

 

 

 

0.14

 

 

 

 

 

Add: Integration/restructuring charges (1)

7

 

 

2

 

 

0.06

 

 

0.02

 

 

 

Less: Net income (loss) attributable to consolidated investment entities

(2)

 

 

 

 

(0.02)

 

 

 

 

 

Add: Tax effect of adjustments (2)

(12)

 

 

(231)

 

 

(0.10)

 

 

(1.83)

 

 

 

Adjusted operating earnings

$

639

 

 

$

333

 

 

$

5.27

 

 

$

2.64

 

 

100%

Less: NOL tax impacts

 

 

(144)

 

 

 

 

(1.14)

 

 

 

Adjusted operating earnings excluding NOL tax impacts

$

639

 

 

$

477

 

 

$

5.27

 

 

$

3.78

 

 

39%

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

118.4

 

 

125.0

 

 

 

 

 

 

 

Diluted

121.2

 

 

126.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Pretax adjusted operating adjustment.

 

 

 

 

 

 

 

 

 

(2) Calculated using the statutory tax rate of 21%.

(3) Diluted shares used in this calculation represent basic shares due to the net loss. Using actual diluted shares would result in antidilution.

(4) Represents the difference of the per share amount for net loss using basic shares compared to the per share amount for net loss using diluted shares.

Ameriprise Financial, Inc.

Reconciliation Table: Earnings

 

Year-to-date
June 30,

 

Per Diluted Share
Year-to-date
June 30,

 

% Over/
(Under)

(in millions, except per share amounts, unaudited)

2021

 

2020

 

2021

 

2020

 

Net income

$

1,028

 

 

$

1,497

 

 

$

8.45

 

 

$

11.77

 

 

(28)%

Add: Basic to diluted share conversion

 

 

 

 

 

 

 

 

 

Less: Net realized investment gains (losses) (1)

66

 

 

(22)

 

 

0.54

 

 

(0.17)

 

 

 

Add: Market impact on non-traditional long-duration products (1)

483

 

 

(670)

 

 

3.97

 

 

(5.27)

 

 

 

Add: Mean reversion-related impacts (1)

(98)

 

 

47

 

 

(0.81)

 

 

0.37

 

 

 

Add: Market impact of hedges on investments (1)

17

 

 

 

 

0.14

 

 

 

 

 

Add: Integration/restructuring charges (1)

7

 

 

3

 

 

0.06

 

 

0.02

 

 

 

Less: Net income (loss) attributable to consolidated investment entities

(3)

 

 

(2)

 

 

(0.02)

 

 

(0.02)

 

 

 

Add: Tax effect of adjustments (2)

(72)

 

 

126

 

 

(0.59)

 

 

0.99

 

 

 

Adjusted operating earnings

$

1,302

 

 

$

1,027

 

 

$

10.70

 

 

$

8.07

 

 

33%

Less: NOL tax impacts

 

 

 

 

 

 

 

 

 

Adjusted operating earnings excluding NOL tax impacts

$

1,302

 

 

$

1,027

 

 

$

10.70

 

 

$

8.07

 

 

33%

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

119.1

 

 

125.7

 

 

 

 

 

 

 

Diluted

121.7

 

 

127.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Pretax adjusted operating adjustment.

 

 

 

 

 

 

 

 

 

(2) Calculated using the statutory tax rate of 21%.

 

Ameriprise Financial, Inc.

Reconciliation Table: Pretax Adjusted Operating Earnings and Pretax Adjusted Operating Margin

 

Quarter Ended
June 30,

 

(in millions, unaudited)

2021

 

2020

 

Total net revenues

$

3,418

 

 

$

2,712

 

 

Less: Net realized investment gains (losses)

10

 

 

(3)

 

 

Less: Market impact on non-traditional long-duration products

21

 

 

(66)

 

 

Less: Mean Reversion related impacts

1

 

 

1

 

 

Less: Market impact of hedges on investments

(17)

 

 

 

 

Less: Integration/restructuring charges

 

 

 

 

Less: CIEs revenue

16

 

 

15

 

 

Adjusted operating total net revenues

$

3,387

 

 

$

2,765

 

 

 

 

 

 

 

Total expenses

$

2,697

 

 

$

3,238

 

 

Less: CIEs expenses

18

 

 

15

 

 

Less: Integration/restructuring charges

7

 

 

2

 

 

Less: Market impact on non-traditional long-duration products

108

 

 

1,047

 

 

Less: Mean reversion-related impacts

(41)

 

 

(13)

 

 

Less: DAC/DSIC offset to net realized investment gains (losses)

(1)

 

 

(1)

 

 

Adjusted operating expenses

$

2,606

 

 

$

2,188

 

 

 

 

 

 

 

Pretax income

$

721

 

 

$

(526)

 

 

Pretax adjusted operating earnings

$

781

 

 

$

577

 

 

 

 

 

 

 

Pretax income margin

21.1

 

%

(19.4)

 

%

Pretax adjusted operating margin

23.1

 

%

20.9

 

%

 

 

 

 

 

 

Ameriprise Financial, Inc.

Reconciliation Table: General and Administrative Expense

 

Quarter Ended
June 30,

% Over/
(Under)

(in millions, unaudited)

2021

 

2020

General and administrative expense

$

830

 

 

$

776

 

(7)%

Less: CIEs expenses

1

 

 

 

 

Less: Integration/restructuring charges

7

 

 

2

 

 

Adjusted operating general and administrative expense

$

822

 

 

$

774

 

(6)%

 

 

 

 

 

 

Ameriprise Financial, Inc.

Reconciliation Table: Effective Tax Rate

 

Quarter Ended
June 30, 2020

 

(in millions, unaudited)

GAAP

 

Adjusted
Operating

Pretax income

$

(526)

 

 

$

577

 

 

Income tax provision

$

13

 

 

$

244

 

 

 

 

 

 

 

Effective tax rate

(2.4)

 

%

42.3

 

%

 

 

 

 

 

 

Ameriprise Financial, Inc.

Reconciliation Table: Effective Tax Rate

 

Quarter Ended
June 30, 2021

 

(in millions, unaudited)

GAAP

 

Adjusted
Operating

Pretax income

$

721

 

 

$

781

 

 

Income tax provision

$

130

 

 

$

142

 

 

 

 

 

 

 

Effective tax rate

18.1

 

%

18.2

 

%

 

 

 

 

 

 

Ameriprise Financial, Inc.

Reconciliation Table: Advice & Wealth Management Adjusted Revenue Per Advisor

(unaudited)

3Q
2019

4Q
2019

1Q
2020

2Q
2020

3Q
2020

4Q
2020

1Q
2021

2Q
2021

% Over/
(Under)

Total Net Revenue ($ in M)

$

1,682

 

$

1,710

 

$

1,695

 

$

1,537

 

$

1,667

 

$

1,776

 

$

1,879

 

$

1,980

 

 

Interest Revenue ($ in M)

$

(116)

 

$

(92)

 

$

(78)

 

$

 

$

 

$

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

 

Advisor Count

9,930

9,871

9,878

9,894

9,905

9,922

10,031

10,047

 

 

 

 

 

 

 

 

 

 

 

Revenue Per Advisor ($ in K)

$

169

 

$

173

 

$

172

 

$

155

 

$

168

 

$

179

 

$

187

 

$

197

 

27%

Revenue Per Advisor excluding short-term interest rate impact ($ in K)

$

158

 

$

164

 

$

164

 

$

155

 

$

168

 

$

179

 

$

187

 

$

197

 

27%

 

 

 

 

 

 

 

 

 

 

Revenue Per Advisor TTM ($ in K)

 

 

 

$

669

 

 

 

 

$

731

 

9%

Revenue Per Advisor excluding short-term interest rate impact TTM ($ in K)

 

 

 

$

641

 

 

 

 

$

731

 

14%

 

 

 

 

 

 

 

 

 

 

 

Ameriprise Financial, Inc.

Reconciliation Table: Adjusted Operating Total Net Revenues Mix Shift

 

Quarter Ended
June 30,

 

(in millions, unaudited)

2021

 

2020

 

 

Advice & Wealth Management

$

1,980

 

 

$

1,537

 

 

Asset Management

879

 

 

668

 

 

RPS

808

 

 

755

 

 

Subtotal adjusted operating total net revenues

3,667

 

 

2,960

 

 

Corporate

119

 

 

131

 

 

Eliminations

(399)

 

 

(326)

 

 

Adjusted operating total net revenues

$

3,387

 

 

$

2,765

 

 

 

 

 

 

 

Advice & Wealth Management

54

 

%

52

 

%

Asset Management

24

 

%

22

 

%

RPS

22

 

%

26

 

%