Ameriprise: Adviser Productivity Improves, Recruting Slows

Strong operating earnings growth in Ameriprise Financial Inc.'s (AMP) advice and wealth-management segment contributed to its strong second-quarter results, and adviser productivity was improved, the company said.

The Minneapolis-based financial-services planning company reported Wednesday that its overall net income increased to $259 million in the second quarter, up from just $95 million a year ago.

Strong operating earnings growth in the quarter reflected continued margin improvement in its advice and wealth-management and asset-management segments, the company said Wednesday. Overall operating earnings increased to $291 million in the quarter, up 172% from a year ago, and up 134% per diluted share, the company said.

Its advice and wealth-management business reported pre-tax income of $85 million in the second quarter, compared to a pre-tax loss of $3 million a year ago, and operating earnings of $88 million compared to $21 million a year ago, the company said. Operating expenses increased 14% to $880 million, primarily as a result of higher adviser compensation from higher business levels, it said.

"Client activity and advisor productivity continued to improve despite the on-going volatility in the markets," Jim Cracchiolo, Ameriprise chairman and chief executive, said in a statement.

Adviser productivity, measured as operating net revenue per adviser, increased 32% compared to a year ago, a record for the company, though it had fewer advisers. Growth was driven primarily by higher asset-based fees as a result of year-over-year market appreciation and net inflows, improved client activity and the company's focus on higher-producing advisers, it said.

Total advisers declined 7% from a year ago to 11,684, due primarily to the departure of low-producing advisers, the company said. Franchise adviser retention rates remain strong, it said. "The company continued to recruit experienced advisers, although at a slower rate than in 2009," it said.

-By Daisy Maxey, Dow Jones Newswires; 212-416-2237; daisy.maxey@dowjones.com

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