Ameriprise is adding new banking services for its clients as its traditional Advice and Wealth Management segment continues to grow, but the financial-services company saw fourth-quarter net earnings decline in part because of hedges placed on variable annuities.
Accounting for a one-time charge related to the annuities and others, adjusted operating earnings per share rose 11%.
"Ameriprise delivered another strong quarter, completing a year of significant progress. We served more clients in our affluent target market, earned strong asset flows and deepened the personal, advice-based relationships our advisers have with clients," said Ameriprise CEO James Cracchiolo in a release.
For the fourth quarter, the Minneapolis-based company's profits dropped 14% to $463 million, or $3.53 cents a share, from the fourth quarter last year. Adjusted earnings, though, increased 1% to $551 million. Adjusted earnings per share were $4.20, an 11% increase over last year but missed Wall Street estimates of $4.27 per share. Adjustments to net GAAP earnings included the market effect of variable annuity hedges and other adjustments.
Cracchiolo categorized the fourth-quarter performance of Advice and Wealth Management as "excellent." Ameriprise's largest segment saw an 8% increase in net revenue for the quarter to $1.7 billion and its pretax adjusted operating earnings increased 5% to $387 million and total client assets grew 19%.
The asset-managment segment of Ameriprise had a good quarter with assets under management of $494 billion, up 15% from the fourth quarter last year. Good markets and performance helped, but results also included net inflows of $3.3 billion.
Ameriprise added banking services last year and Cracciolo said they plan to add additional banking products including mortgages in 2020.
Ameriprise shares closed at $170.51, up 2.7%. Shares traded between $173.75 and $121.55 over the last 52 weeks.
