The company is aiming for above-system growth over the next few years
AMP chief Alexis George says the company will strengthen its bank and platforms businesses and look for partnerships to bolster its home lending and advice offerings in the coming years. George made the comments as the wealth manager continues the process of demerging its capital private markets business.
AMP said Tuesday that the demerger was progressing well and should be finalised by June of next year, according to a report by The Australian. AMP will retain its bank, wealth management and New Zealand businesses.
“We’re going to be a much smaller company,” George told shareholders Tuesday. “We have to think differently, act differently, make decisions differently, think about our committee structures differently … to make us a more streamlined organisation going forward.”
George said that two growth opportunities for AMP in the short to medium term were the bank and platforms, The Australian reported.
“I see real opportunities in the bank,” George said. “We’re a small bank. We don’t have branches, we have simple solutions, we have a good cost-to-income ratio, we have good return on equity, and we have a name that I think is well positioned.”
George said that AMP’s home loan book was small but well-managed. AMP currently holds just 1% market share, but George said she wanted to see the company grow well above system in the next few years, while cautioning on the outlook for the net interest margin, The Australian reported.
“I understand there’s pressures on [the net interest margin], but I don’t think they’re pressures that cannot continue to support both our ambitions financially and our ambitions from a customer perspective,” she said. “So I see some decline, but I certainly feel that we’re well positioned in that space.”
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George later told The Australian that she was confident about AMP’s home lending prospects even with the market expected to cool in 2022.
“We can grow at two times system because we’ve done the hard yards in terms of increasing our operational capacity, we’ve maintained service standards with the brokers, and I think people want alternative options – so we can be that alternative option,” she told the publication. “Given the size we are, it’s not a lot of volume to double market share. So I feel comfortable that regardless of what the market does, that we’re well positioned there.”
George told shareholders that AMP is targeting two to three times above-system growth in the next few years, and plans to achieve it in part by aligning with partners.
“We need to focus on our lending origination and make that more streamline, and we’re currently looking for partners to help us with that,” she said. “We don’t have to build everything ourselves. Partnering is a skill we must have, we must develop, and we need to move forward on.”
