Ameriprise Financial(AMP) - 2024 Q2 - Quarterly Report

Financial Performance - For the six months ended June 30, 2024, adjusted operating earnings were $1.76 billion, representing a growth from$ 1.61 billion in the same period of 2023[284]. - The adjusted operating earnings per diluted share for the six months ended June 30, 2024, was $16.92, compared to$ 14.70 for the same period in 2023, reflecting a growth of 15%[284]. - Total revenues for the six months ended June 30, 2024, increased by $865 million, or 11%, to$ 8,717 million compared to $7,852 million in the prior year[323]. - Total revenues for the three months ended June 30, 2024, were$ 4,392 million, an increase of $385 million, or 10%, compared to$ 4,007 million in the prior year[294]. - Total revenues for the three months ended June 30, 2024, increased by $342 million, or 14%, to$ 2,816 million compared to $2,474 million in the prior year[302]. - Total revenues for the six months ended June 30, 2024, were$ 5,555 million, an increase of $713 million, or 15%, compared to the prior year period[333]. Assets Under Management - As of June 30, 2024, Ameriprise Financial has$ 1.4 trillion in assets under management and administration[281]. - Total Assets Under Management (AUM) increased by $100.7 billion, or 10%, to$ 1.1 trillion as of June 30, 2024, compared to $1.0 trillion a year earlier[292]. - Advice & Wealth Management AUM rose by$ 80.0 billion, or 18%, driven by equity market appreciation and net inflows into wrap accounts[292]. - Total Assets Under Administration (AUA) increased by $50.4 billion, or 20%, to$ 298.4 billion, primarily due to equity market appreciation and growth in third-party money market funds[292]. - Total managed assets increased by $25.3 billion, or 4%, to$ 641.9 billion as of June 30, 2024, compared to $616.6 billion in the prior year[335]. Shareholder Equity and Capital Adequacy - Total Ameriprise Financial, Inc. shareholders' equity as of June 30, 2024, was$ 4.50 billion, up from $3.94 billion as of June 30, 2023[286]. - Available Capital for Capital Adequacy as of June 30, 2024, was$ 5.25 billion, down from $5.42 billion as of December 31, 2023[287]. - The company maintained$ 7.5 billion in cash and cash equivalents as of June 30, 2024, excluding CIEs and other restricted cash[352]. - The estimated borrowing capacity from the Federal Reserve was $12.3 billion as of June 30, 2024, with no outstanding obligations[352]. Earnings and Expenses - Adjusted operating earnings for the Advice & Wealth Management segment increased to$ 1,584 million for the six months ended June 30, 2024, from $1,424 million in the prior year[330]. - Total expenses increased by$ 420 million, or 15%, to $3,169 million, driven by higher distribution expenses and interest credited to fixed accounts[294]. - Distribution expenses for the six months ended June 30, 2024, increased by$ 395 million, or 16%, primarily due to higher advisor compensation[327]. - General and administrative expenses decreased by $24 million, or 3%, for the six months ended June 30, 2024, reflecting operational efficiency initiatives[340]. - The effective tax rate for the six months ended June 30, 2024, was 19.9%, compared to 19.5% for the prior year period[328]. Investment Performance - Net investment income rose by$ 110 million, or 14%, primarily due to growth in customer deposits and rising interest rates[298]. - Net investment income for the six months ended June 30, 2024, increased by $313 million, or 21%, primarily due to growth in customer deposits and higher average balances[326]. - Net investment income increased by$ 77 million, or 16%, for the three months ended June 30, 2024, driven by higher average invested assets and increasing short-term interest rates[303]. - Net investment income for the three months ended June 30, 2024, decreased by $29 million, or 38%, primarily due to a$ 12 million benefit in affordable housing partnerships in the prior year[319]. Market Conditions and Strategic Focus - The company continues to focus on strategic objectives amidst macroeconomic uncertainties, including interest rate fluctuations and market volatility[281]. - The daily average of the S&P 500 index increased by 25% from 4,207 in June 30, 2023, to 5,253 in June 30, 2024[290]. - The average yield for investment purchases during the six months ended June 30, 2024, was approximately 5.7%[368]. Corporate Actions and Future Outlook - As of June 30, 2024, the company had $2.1 billion remaining under its share repurchase authorization of$ 3.5 billion, which is valid through September 30, 2025[357]. - The company intends to fund share repurchases through existing excess capital and future free cash flow generation[357]. - The company has not recorded any Pillar Two tax liabilities based on current estimates and continues to monitor the adoption of related rules[353]. - The Federal Reserve Board's new consolidated capital framework for savings and loan holding companies will take effect on January 1, 2024, with reporting beginning in 2025[355].